Transcript Unit 8 Pricing

Unit 8 Pricing
Contents
1. Warm up
2. Term Study
3. Outline of The Texts
4. Discussion
5. More Information
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1. Warm up
An Introduction:
Most other perishable products—milk,
trendy sweaters—get cheaper the closer
they are to being “expired”. Airline seats
get more valuable the closer they get to
being “expired”. The most valuable seat is
the one that somebody must have an hour
before take-off and is willing to pay
almost any price for. How do you explain
this?
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1. Warm up
Warm-up questions
Text A
Text B
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1. Warm up
Text A

There are two passengers on the same plane,
sitting across the aisle from each other, one
of whom paid $290 to fly from New York to
Miami, one of whom paid $1290. Why?

Do you know what products get more expensive
the closer they are to being expired?
Text A
terms
Text B
warm-up
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1. Warm up
Text B

Suppose you have designed a new product and
you want to push it to the market. Then in
what way will you price your product?

Have you ever heard of “scientific pricing”?
Pwin (R)=<sum>NfN x P(R)N. Do you understand
this equation?
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2. Term Study
Terms
Text A
Text B
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2. Term Study (A)
Microeconomics
Microeconomics a branch of economics that studies
how households and firms make decisions to allocate
limited resources, typically in markets where goods
or services are being bought and sold.
Microeconomics examines how these decisions and
behaviors affect the supply and demand for goods
and services, which determines prices; and how
prices, in turn, determine the supply and demand of
goods and services.
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2. Term Study (A)
Microeconomics
微观经济学 又称个体经济学、小经济学，是宏观经济学
的对称。微观经济学主要以单个经济单位(单个的生产者、
单个的消费者、单个市场的经济活动)作为研究对象，分
析单个生产者如何将有限的资源分配在各种商品的生产上
以取得最大的利润；单个消费者如何将有限的收入分配在
各种商品的消费上以获得最大的满足。同时，微观经济学
还分析单个生产者的产量、成本、使用的生产要素数量和
利润如何确定；生产要素供应者的收入如何决定；单个商
品的效用、供给量、需求量和价格如何确定等等。微观经
济学是研究社会中单个经济单位的经济行为，以及相应的
经济变量的单项数值如何决定的经济学说。
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2. Term Study (A)
Microeconomics
微观经济学 的主要内容：
第一，均衡价格理论，也称价格理论；
第二，消费者行为理论；
第三，生产理论，即生产者行为理论；
第四，厂商均衡理论，或称市场结构理论；
第五，分配理论；
第六，一般均衡理论与福利经济学；
第七，市场失灵与微观经济政策。
Attention：微观经济学研究的是单个经济单位的经济行
为；解决的问题是资源配置；其中心理论是价格理论。
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2. Term Study (A)
Macroeconomics
Macroeconomics is a branch of economics that deals
with the performance, structure, and behavior of a
national or regional economy as a whole. It is the
study of the behavior and decision-making of entire
economies. Macroeconomists study aggregated
indicators such as GDP, unemployment rates, and price
indices to understand how the whole economy
functions. They develop models that explain the
relationship between such factors as national income,
output, consumption, unemployment, inflation, savings,
investment, international trade and international
finance.
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2. Term Study (A)
Macroeconomics
宏观经济学是以国民经济总过程的活动为研究对象，因
为主要考察就业总水平、国民总收入等经济总量，因此，
宏观经济学也被称作就业理论或收入理论。
宏观经济学和微观经济学并不分开，“宏观”就是在
“微观”的基本思维基础上发展的。但“宏观”又区别
于“微观”。“微观”研究的是某个组织、部门或个人
在经济社会上怎么样作出决策，以及这些决策会对经济
社会有什么影响。而“宏观”则是研究整个的经济社会
如何运作，并找出办法，让经济社会运行得更加稳定、
发展得更快。
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2. Term Study (A)
Macroeconomics
宏观经济学的内容：
1）宏观经济理论：国民收入决定理论、消费函数理
论、投资理论、货币理论、失业与通货膨胀理论、经济周
期理论、经济增长理论、开发经济理论。
2）宏观经济政策：经济政策目标、经济政策工具、
经济政策机制（即经济政策工具如何达到既定的目标）、
经济政策效应与运用。
3）宏观经济计量模型：根据各派理论所建立的不同
模型。这些模型可用于理论验证、经济预测、政策制定，
以及政策效应检验。
Text A
outline
Text B
terms
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2. Term Study (B)
Yield Management
Yield management, also known as revenue
management, is the process of understanding,
anticipating and influencing consumer behavior in
order to maximize revenue or profits from a fixed,
perishable resource (such as airline seats or hotel
room reservations). This process was first
discovered by Dr. Matt H. Keller. The challenge is
to sell the right resources to the right customer at
the right time for the right price. Yield
management is a large revenue generator for
several major industries.
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2. Term Study (B)
Yield Management
收益管理，20世纪80年代发展起来的一种现代科学营运管
理方法。其核心是通过制定一套灵活的且符合市场竞争规
律的价格体系，再结合现代化的微观市场预测及价格优化
手段对公司资源进行动态调控，使得公司在实现长期目标
的同时，又在每一具体营运时刻充分利用市场出现的机遇
来获取最大受益。概括而言，收益管理目标是使公司产品
能在最佳的时刻，以最好的价格，通过最优渠道，出售给
最合适的顾客。收益管理的基本原理就是通过对市场的细
分，对不同目的的顾客在不同时刻的需求进行定量预测，
然后通过优化方法来确定动态的控制，最终使得总收益达
到最大化，并保持公司的持续增长。
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3. Outline of the Texts
Outline
Text A
Text B
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3. Outline of the Texts
Text A
Outline
Paras. 1-4
Introduction: the mystery of pricing
Paras. 5-13
There are various factors confounding accepted
wisdom about pricing
Paras. 14-24
An example: the oddities of airline pricing
Text A
discussion
Text B
outline
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3. Outline of the Texts
Text B
Outline
Part 1
Paras. 1-8
The smart way to lower prices: discount
less but sooner
Part 2
Paras. 9-24
The new science of pricing: test and test
again
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4. Discussion
TEXT
Discussion questions
TEXT
Text A
TEXT
TEXT
Text B
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4. Discussion
Text A

Have you got an idea whether your prices
should be kept a secret? In a company, should
all staff be informed of the pricing strategy
or should the pricing strategy be held a secret
by high-level managers?

In today’s information age, is it still possible to
keep your pricing strategy a secret from your
competitors or your consumers?
More
information
Text B
discussion
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4. Discussion
Text B

Will our society be overwhelmed by markdowns
or such “slogans” as “跳楼价”, “赔本甩卖”,
etc.? Do you feel excited at it or not very
comfortable?

OPEC, CNBC and even money are all actually
“devoted” to the topic of “price”. Have you had
a further understanding of the role played by
pricing in our society?
More
information
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5. More Information
Pricing Strategy
One of the four major elements of the marketing mix
is price. Pricing is an important strategic issue because
it is related to product positioning. Furthermore,
pricing affects other marketing mix elements such as
product features, channel decisions, and promotion.
Before the product is developed, the marketing
strategy is formulated, including target market
selection and product positioning. There usually is a
tradeoff between product quality and price, so price is
an important variable in positioning.
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5. More Information
Pricing Strategy
A general sequence of steps for developing
the pricing of a new product:



Develop marketing strategy—perform
marketing analysis, segmentation, targeting, and
positioning.
Make marketing mix decisions—define the
product, distribution, and promotional tactics.
Estimate the demand curve—understand how
quantity demanded varies with price.
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5. More Information
Pricing Strategy




Calculate cost—include fixed and variable costs
associated with the product.
Understand environmental factors—evaluate likely
competitor actions, understand legal constraints, etc.
Set pricing objectives—for example, profit
maximization, revenue maximization, or price
stabilization (status quo).
Determine pricing—using information collected in
the above steps, select a pricing method, develop
the pricing structure, and define discounts.
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5. More Information
The supply and demand model
The supply and demand model
describes how prices vary as a
result of a balance between
product availability at each
price (supply) and the desires
of those with purchasing
power at each price (demand).
The graph depicts a rightshift in demand from D1 to D2
along with the consequent
increase in price and quantity
required to reach a new
market-clearing equilibrium
point on the supply curve (S).
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5. More Information
Circulation in macroeconomics
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