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Elasty mobile phone cover1/2/2024 ![]() “If my product is highly elastic, it is being perceived as a commodity by consumers.” It tells you how effective you are at marketing your products to consumers. Price elasticity is a way for us to measure how we’re doing in that regard,” she explains. “Our job is to create products and services that have unique and sustainable value for customers compared with other options available to them in the marketplace. This is one of the key metrics for marketing managers, says Avery. Marketers should know where their products fall on this spectrum, but “the actual number is less important than knowing which zone your product falls within and what will happen to consumer demand if you change your price,” she says. Even if I change my price, you still have to buy from me,” explains Avery. “We tend to see this only in cases where a firm has a monopoly on the demand. Products in this category are things consumers absolutely need and there are no other options from which to obtain them. Perfectly inelastic where the quantity demanded does not change when the price changes.Also, “products with stronger brands tend to be more inelastic, which makes building brand equity a good investment,” says Avery. ![]() Gasoline is a good example here because most people need it, so even when prices go up, demand doesn’t change greatly. Relatively inelastic where large changes in price cause small changes in demand (the number is less than 1).Unit elastic where any change in price is matched by an equal change in quantity (where the number is equal to 1).Beef, as discussed above, is an example of a product that is relatively elastic. Relatively elastic where small changes in price cause large changes in quantity demanded (the result of the formula is greater than 1).“There’s no brand, no product differentiation, and customers have no meaningful attachment to the product.” ![]() Products that fall in this category are mostly “pure commodities,” says Avery.
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