MARKETING: Pricing Concepts and Strategies (Short Essay Discussion) - 73777

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 Short Essay Discussion:  

Identify an industry prone to price wars. Describe the reason(s) for that price war, and the factors that make price wars more likely in that industry rather than in other industry. Use the cellular phone Industry, as the industry is prone to price wars

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We select the cellular phone industry as the industry, which is sensitive to pricing. In general, price wars take place because of the following. 

  1. An oligopolistic market can generate price wars. Here, although the few major players keep prices at more or less the same value, an overzealous CEO can go in for reduced prices for bringing in higher volume. Such action however shows almost immediate retaliation