By Josep Francesc Valls Giménez
years. yet over the top efforts by way of many businesses to carry costs down may possibly sound the dying knell for terribly low costs, as they are going to easily turn into unsustainable in lots of sectors, with expenses forcing them up. evidently there will
always be shoppers who wish reduce costs and someone must meet the call for, yet emphasis on promoting on the lowest rate attainable could turn into very costly.
Clients are continuously challenging reduce costs on the time of every buy and corporations can purely react through lowering bills. This quantity exhibits that the single technique to do that, is to reinvent the company version. New shoppers, new pricing, new manufacturers, new strategies.
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Extra resources for Beyond the Low Cost Business: Rethinking the Business Model
5% respectively). 7%, respectively). 24(a), (b), (c), (d) and (e)). 25, factors like innovation, reliability, tradition, specialisation, pleasure and differentiation are identified with name brands; the factor of accessibility is fairly similar across the different brands; and the The Birth of the Low-Cost Phenomenon 33 product-checking factor leans towards the own brands. Looking at this, it seems own brands are simultaneously associated with low prices, reasonable prices, choice, fitting the budget and pricing for value.
3 Four groups of buyers While SCS’s traditional, rigid linear scheme is disappearing (under which quality – involvement, innovativeness and brand loyalty – lay at one extreme and price at the other), the problem is to identify price sensitivity under the new scenario and pin down the resulting consumer types arising from the price–value relationship. For this purpose, we have taken both the internal and external factors identified earlier and compared these with the four consumer types put forward by De Jaime Eslava (De Jaime Eslava, 2007).
We drew up a questionnaire that took into account the factors affecting the new scenario (detailed in the previous section), namely the need to be satisfied, the value structure, income, the economy, competitors’ rivalry, price presentation and the sales channel. The sample was formed by 418 individuals in the Barcelona Metropolitan Area, stratified by gender, age (18 or over), education level and income. A closed questionnaire was administered over the Internet and complemented with telephone interviews in June 2011.