question archive Should Procter & Gamble use reward or loyalty programs to influence demand and price elasticity for its products? How would these programs influence current and future demand? Why would the price elasticity of demand for an individual firm's product be greater than the elasticity of the overall product market?
Should Procter & Gamble use reward or loyalty programs to influence demand and price elasticity for its products? How would these programs influence current and future demand? Why would the price elasticity of demand for an individual firm's product be greater than the elasticity of the overall product market?
Subject:EconomicsPrice:2.88 Bought3
Should Procter & Gamble use reward or loyalty programs to influence demand and price elasticity for its products? How would these programs influence current and future demand? Why would the price elasticity of demand for an individual firm's product be greater than the elasticity of the overall product market?
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Yes, these types of loyalty programs would increase demand for P&G's products through discounts and coupons as well as make demand less elastic since customers will be less likely to seek substitute products from competitors. The price elasticity of demand is greater for an individual product over the overall market because the market typically contains many substitutable products. When there are substitutes present, the price change of one product is likely to lead consumers to seek substitutes from a competitor rather than not buy that product at all.
