Paper info: One Decision But Many Practices: a Practice-Based Approach to Price Decision-Making
One Decision But Many Practices: a Practice-Based Approach to Price Decision-Making
Sof Thrane, Martin Jarmatz, Michael Fetahi Laursen, Katrine Fabritius Kornmaaler and Troels Troelsen
Place of Publication
The paper was published at the 32nd IMP-conference in Cape Town in 2016.
Pricing greatly impacts the profitability of firms and is considered a strategically and operationally important process. Though, price decision-making is very complex and thus, also challenging. This is due to the fact that firms often experience high customer pressure to lower prices, pricing information asymmetry across the organization and coordination issues. Research has only to a limited extent dealt with this complexity. To shed further light on this, this paper employs a practice approach to pricing decision-making by studying two case companies. We suggest that the price decision-making process consists of a set of four practices, namely information-processing, communicating, interacting with pricing system and delegating pricing authority. The practices, and its inherent activities, are interrelated and carried out by various actors in the process in order to deal with the complexity of pricing, eventually leading them to pricing decisions. This practice-based study thereby contributes to the literature on pricing practices, behavioral pricing, delegation of pricing authority and sales-as-practice research