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Pricing Issues on the Internet

One of the easiest places to see the impact of the Internet on marketing is by looking at its effect on pricing decisions and consumer's perceptions of prices. Since its inception, the World Wide Web (WWW) has developed the reputation as being the place to shop to get the lowest prices.

- Why has this reputation developed?
- Why might it be possible to charge lower prices online?
- Are products really cheaper?

To answer this last question, choose two products and find them for sale online (books, CD's, and software work very well). Calculate the total price that would be charged to your credit card, then go to a "brick and mortar" retailer and find prices for the same product there. Make your comparisons.

- Where is the cheapest place to buy the products that you have selected?
- What costs go into determining which place you buy your product?
- Are there any non-financial costs to shopping online? To off-line shopping?

Solution Preview

For the purposes of assisting you with getting started on this assignment, I will share my perspective and personal experiences with internet shopping and buying decisions. Please use this information to further your thought process on the topic at hand.

The inception of the internet has made a tremendous difference on the way some people shop. While some consumers may use the internet to compare prices before heading out to brick and mortar establishments, others utilize this technology to make purchases without stepping foot into a store. A few stores now offer an online shopping option with the option to pick up the items purchased in the store, which saves the consumer time searching for items in the store and saves on shipping costs in some cases. However, most online stores offering to ship items directly to your door. The internet has also changed gift giving, making it possible to send gifts to loved ones around the world without leaving home to shop for the gift or visiting the post office to ship the gift as items can be ...

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