Explain the pricing strategy being implemented when a retail store places the store's generic brand items next to the national brand items when the national brand items have a slightly higher price than the generic brand item

Why would a retailer do this?


The store is relying on the assimilation effect. A retailer may do this in an attempt to show the consumer that the products are very similar, and then consumers will feel as if they are saving money by purchasing the generic versus the national brand item. Sales of the generic items will likely increase because of their positive association with the brand items and their somewhat lower prices.

Business

You might also like to view...

Negotiations may reach impasse due to value differences, which vary from minor differences in preferences to major differences in ideology, lifestyle, or what is considered sacred and critical.

Answer the following statement true (T) or false (F)

Business

Andrew is a mediator with a dispute resolution firm. He has been selected to mediate a dispute between two corporations. Which of the following statements is true of his powers?

A) Andrew can reach a judgment that will be binding on both parties. B) Andrew can make a final decision that will be used as evidence by a court. C) Andrew can help the disputants draft an agreement that will be binding. D) Andrew can deliver a binding judgment only if the parties do not reach an agreement.

Business

A fundamental principle in the law of agency is that the principal–agent relationship

creates _____ duties between the parties. Fill in the blanks with correct word

Business

According to the American Marketing Association's definition of marketing, which of the following statements is true?

A. The focus of production-driven companies is on developing and sustaining relationships with their customers. B. Though marketing plays an important role in developing relationships with customers, it does not help in maintaining them. C. By definition, a marketing transaction has to involve the exchange of money. D. Successful companies recognize that creating and delivering value to their customers is extremely important. E. Most marketers are seeking a one-time exchange or transaction with their customers.

Business