Flanking in a Price War
The article “Flanking in a Price War” discusses a pricing experiment that was conducted in the Quebec grocery industry. The experiment was initiated by a grocery chain in Quebec that was concerned about a possible price war between the major players in the market. Given in the article is a background of the Quebec grocery industry and its typical pricing strategies and marketing theory. It also discusses the different ways to look at pricing tactics other than the traditional “price slashing” that had happened before. The experiment looks at other ways to categorize products that may react differently to pricing changes. The Bayesian theory of using the knowledge of prior events to predict future events in implemented in executing the results of the experiment The article first focuses on the Steinberg grocery chain. In the late ‘80’s Steinberg needed to increase their market share. It was expected that they would lower their prices and start a price war like they have in the past. IGA- Boni, one of the four major players in the Quebec grocery industry, was concerned over this possibility as they would need to react to any price changes to keep their market share, but doing so would cause large profit los
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Some common words found in the essay are:
Design Previous, Market Quebec, Strategies Steinberg, Price War, Possibly Running, Learned IGA, Experiment Results, Weaknesses Strengths, IGA- Boni, market share, price war, Canada United, quebec grocery, decrease market, margin decrease, margin decrease market, decrease market share, grocery industry, quebec grocery industry, price caused, pricing experiment, 5% margin, 5% margin decrease, pricing strategies, increase market share,
Approximate Word count = 1581
Approximate Pages = 6 (250 words per page double spaced)
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