Question: The external consultancy also wants Kelly to consider some additional scenarios. They think that one of their assumptions may not hold true. This assumption states
The external consultancy also wants Kelly to consider some additional scenarios. They think that one of their assumptions may not hold true. This assumption states that:
The consumers reservation price for a health&beauty version of the product is the higher of the reservation prices they have for the health version and the beauty version, ie reservation price health&beauty max reservation price health reservation price beauty After all, if the nail brightening cream has a very focused positioning on beauty versus a diffused positioning on health&beauty, consumers who are looking for a beauty benefit may pay more for the beautyspecific version. The same may also hold for consumers wanting a health benefit and a health version being offered versus a health&beauty version On the other hand, some consumers may prefer a general product to a specific product.
What is the best price for Kelly to charge if she has:
only one health&beauty version of the product
two versions of the product: a healthspecific version and a beautyspecific version
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