When Starbucks runs a buy one get one free promotion, they effectively lower the price of a drink by 50%. The company sells more drinks, but at a lower price. Elasticity determines whether or not this promotion will be profitable. How? Explain in your own words.

When Starbucks runs a buy one get one free promotion, they effectively lower the price of a drink by 50%. The company sells more drinks, but at a lower price. Elasticity determines whether or not this promotion will be profitable. How? Explain in your own words.

Principles Of Marketing

17th Edition

ISBN:9780134492513

Author:Kotler, Philip, Armstrong, Gary (gary M.)

Publisher:Kotler, Philip, Armstrong, Gary (gary M.)

Chapter1: Marketing: Creating Customer Value And Engagement

Section: Chapter Questions

Problem 1.1DQ

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Concept explainers

Introduction to Business Messages

Business messaging refers to a variety of channels via which businesses and customers can interact. SMS or text messaging is the most popular method of communication. Shipment reminders, promotional incentives, marketing offers, and scheduled appointments are all things we have dealt with. These are the types of messages we usually identify with business communication. Business messaging can take place on any digital platform where your consumers already spend some time, with the expectation that communication will be two-way. Business messaging brings comfort and simplicity to customers. Customers expect comfort from pre-sales and post-sales engagements with businesses as they do with friends and family. In addition, messaging is the favored method of contacting a firm for 66% of buyers. Here are a few examples of popular business messaging situations.

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NOV 13-17, 2-5PM
Buy one holiday drink, get one free to share
When Starbucks runs a buy one get one free promotion, they effectively lower
the price of a drink by 50%. The company sells more drinks, but at a lower price.
Elasticity determines whether or not this promotion will be profitable. How?
Explain in your own words.

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