If a manager designs the shoe department in a manner that one of its private-label pairs of shoes,priced at $39.99,is positioned next to a well-known national brand of shoes priced at $69.99,what strategy is the manager attempting to accomplish?
A) Everyday low price
B) Odd-even pricing
C) Prestige pricing
D) Special-event pricing
E) Reference pricing

Question

Quizplus · Accepted Answer

The manager is attempting to influence customer perception and behavior through reference pricing, where the private-label pair of shoes, priced at $39.99, is positioned next to a well-known national brand of shoes priced at $69.99. By positioning the two products close to each other, customers are likely to view the private-label pair as relatively inexpensive or a better value for money in comparison to the well-known brand. This is an example of reference pricing, as the customers use the price of the well-known brand as a reference for evaluating the private-label pair.

If a Manager Designs the Shoe Department in a Manner