In response to Duracell's introduction of the Duracell Ultra battery, Energizer introduced an Advanced Formula battery. But unlike Duracell, Energizer priced its battery at a low initial price to attract the mass market. Was Energizer's pricing strategy to take market share from Duracell a success?
A)No, because consumers are price-insensitive when it comes to batteries.
B)Yes, because of the positive association with the "Energizer Bunny" marketing campaign.
C)No, because consumers were unable to perceive the improved quality due to the low price.
D)Yes, because consumers typically respond positively to cost-plus pricing.
E)Yes, because the demand for batteries has unitary elasticity.

Question

Quizplus · Accepted Answer

Energizer's low pricing strategy may have led consumers to perceive the product as lower quality, which could have hindered its success in taking market share from Duracell.

In Response to Duracell's Introduction of the Duracell Ultra Battery