MKTG 317 Study Guide - Final Guide: Market Power, Demand Curve, Longrun
17 Oct 2016
School
Department
Course
Professor
Document Summary
These goals are deri(cid:448)ed fro(cid:373) the fir(cid:373)"s o(cid:448)erall o(cid:271)jecti(cid:448)es. Understanding of the marketplace and the consumer tell whether a goal is realistic. Considerations in establishing pricing goals: demand, costs, profits. Profit maximization - setting prices so that total revenue is as large as possible relative to total costs. Both price and profits depend on the type of competitive environment. May sound impressive to shareholders, but it is not good enough for planning. When attempting to maximize profits, managers: attempt to expand revenue by increasing customer satisfaction attempt to reduce costs by operating more efficiently attempt both. Striving to enhance customer satisfaction leads to greater profitability than following a cost-reduction strategy or attempting to do both. Level of profits consistent with the level of risk an organization faces. (higher risk, higher profit required) Often connected to corporate social responsibility (companies may forgo a blind pursuit of profits to focus on the environment, a safe work environment, and other csr initiatives).
