Archived posting to the Leica Users Group, 2005/06/02
[Author Prev] [Author Next] [Thread Prev] [Thread Next] [Author Index] [Topic Index] [Home] [Search]<<I guess that's why they're having another price increase this month. -------- << Do the Germans reject micro-economic theory?>> ============ RAISING prices in the face of bad business news is a time honored strategy in the marketing of prestige items. If a company is in danger of going out of business or of taking a valued product off the market, would be buyers will be encouraged to pay higher prices to secure the remaining items. One of my wife's friends is an art dealer who runs a high priced art gallery in New York. If a painting doesn't sell, she INCREASES the price. Art shoppers who look at the painting say "It was only $5000 last week, this week it is $6000. I'd better buy it before the price goes any higher." She has been is business for many years and makes a lot of money from this marketing strategy. Economists call this "Negative price elasticity." The higher the price, the more valued the item. See your nearest cosmetics counter for an everyday example of this approach. Leicas cost more but you are worth it. Larry Z