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Price adjustments

Step 1: Identify an example of a recent price adjustment. This can be a new sale price, a price increase or a special offer.

Step 2: Research the history of the price for this product, including competitive influences.
• Consider what led the company to make the price adjustment. Was it proactive or reactive?
• What was the influence of competitors before the price adjustment?
• What are the actions taken by competitors after the price adjustment?

Step 3: Draw conclusions from your research.

Solution Preview

Step 1:
In this step, you need to identify a product that has experienced a recent price decrease. An example of such a product would be the iPhone 4 and iPhone 4s from Apple. Starting approximately six months ago, Apple began dropping prices on all iPhone 4 and 4s models. The price decrease continues, and many cell phone companies are using the iPhone 4 and 4s as the standard phone that they give free to customers for entering into a cell phone contract. Previous to this, only the standard, non-smartphone models were used as free phones or phones that only cost pennies.

If you look at AT&T's website (www.att.com), you will see several smartphones from Apple (The older models) for free and for ...

Solution Summary

This solution helps the student work through each of the three steps in the price adjustments question listed. Examples of recent price adjustments, including what - how - and why the adjustment was made are discussed, and the conclusions regarding the adjustment are also discussed.