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Is the right price a fair price?

Prices are often set to satisfy demand or to reflect the premium that consumers are willing to pay for a product or service. Some critics shudder, however, at the thought of $2 bottles of water, $150 running shoes, and $500 concert tickets.

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Solution Summary

This solution explains marketing offering examples in terms of the two concepts 'right price' vs. 'fair price,' and also drawing in the ethical implications of a capitalistic society.

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Please refer to file response attached, which is also presented below. I hope this helps and take care.

RESPONSE:

1. Is the right price a fair price? Prices are often set to satisfy demand or to reflect the premium that consumers are willing to pay for a product or service. Some critics shudder, however, at the thought of $2 bottles of water, $150 running shoes, and $500 concert tickets.

This is an equity issue, one of fairness. I guess this depends on which side of the fence you sit when trying to determine what is fair and what is not fair. Most, if not all, companies are company-profit driven entities, with prices often set to satisfy demand or to reflect the premium that consumers are willing to pay for a product or service (i.e. other factors are involved also).

In fact, marketing of products and services, often under the guise of customer sensitivity, is aimed at increasing the demand or the products and services offered, and thus, the profits for the company. Thus, marketing is profit-driven to make more money.

Take one marketing strategy for example, that of price sensitivity. Price sensitivity is an understanding, monitoring, and controlling for the factors affecting the demand for their products and services. The demand for a particular good or service depends on a variety of factors. Key influences include the tastes of consumers, the levels of consumer ...

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