An investigation of the pricing attitudes and practices of Korean business
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While Korea is recognized as one of the most rapidly industrializing countries, marketing and marketing research have not been fully developed, and, furthermore, there has been little research on pricing. Therefore, this study reports on a survey with 303 Korean business people about their pricing attitudes and practices in order to obtain information about Korean businesses and help them improve their pricing strategies by suggesting ideas based on price theory and previous price research.
The basic results of the survey indicate that although pricing has been generally recognized as an important area in marketing by Korean business people, it has not been examined as a way to influence demand in advanced market environments. While it is revealed that Korean consumers are price sensitive and Korean business situations are competitive, Korean businesses seem to have offered similar products with a relatively rigid pricing approach based on production costs. Their pricing strategies appear not to be related to the other elements of the marketing mix. However, promotional pricing, mainly as discounts, was regarded to be important to gain a competitive edge. In terms of actual price setting in industry and firms, many Korean businesses assume the characteristics of a price taker rather than price maker. Their primary short run pricing objective was to meet existing competition. However, the major basis of their pricing policies was either competitive situation or pricing what the market will bear.
This study provides a general view on the type of issues that should be considered in pricing, and evaluates the pricing practices of Korean businesses in comparison to those of more advanced countries. The study is also of value to Korean business people because it offers them information on how prices are set in various industries, and the attitudes and opinions of business people about the pricing function.
- Masters Theses