PROFIT MAXIMIZATION THROUGH A DIFFERENTIAL PRICING STRATEGY

Vasile Deac, Cosmin Dobrin, Adriana DIMA (girneata) and Laura Violeta Voicu
Authors registered in the RePEc Author Service: Adriana Dima (Girneata)

Proceedings of the INTERNATIONAL MANAGEMENT CONFERENCE, 2016, vol. 10, issue 1, 234-244

Abstract: The practical approach of strategy formulation, given the company's mission, is based on the key strategic objective that is to be achieved through the respective strategy. The strategic objective is different from one company to another, even in the case of competing companies, and different from one period to another, even within the same company.Companies can have very different strategic objectives, such as sales-oriented objectives (achieving a certain volume of sales, achieving a certain market share), objectives such as survival of the company (especially in a context of crisis and fierce competition) market dominance through product quality and others. But whatever the fundamental objective in the medium or short term, one cannot omit the objective of profit, or maximization of profit, which is the ultimate goal of any economic organization. At the same time, whatever the targeted strategic objective, price has a decisive role in achieving it and, in general, in the success of the overall strategy of the company. There are numerous situations in which a wrong price strategy compromised the overall strategy of the company. Within this paper, we intend to highlight how a differential pricing strategy can contribute to maximizing profit.

Keywords: profit; strategic objectives; market segmentation; differential pricing; potential margin. (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:rom:mancon:v:10:y:2016:i:1:p:234-244

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