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Kimberly-Clark and Weber Grills vs. Ailawadi and Farris: Stupid or Smart Pricing?

August 2013 Pricing 1 Comment

Kimberly-Clark Corp. (KMB) is “desheeting” its products to improve profitability. Weber Stephen Products LLC avoids price promotions and markdowns on their grills, and yet maintains a dominant market position. These are two rather disjointed activities but they both appear to fall afoul of the suggestions given in a recent Wall Street Journal article by Professor Ailawadi of Tuck and Professor Farris of Darden. Are Ailawad and Farris wrong, are the companies wrong, or can both pairs be right?

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Which of the following is most critical for a successful entrepreneur to have? -An Idea –Money –Employees -Customers Which one? Customers you goof.

  1. Who do you serve?
  2. What do they need?
  3. Why are you the best person to serve them?
  4. How will they learn this?
  5. “The difference between an idea and a profit-making business is the difference between an amoeba and a human being.”  -James T. Berger
  6. Ideas, money, and employees are results and inputs into a strategy.  Customers are the purpose.