As most companies have taken the traditional path, in the past, to increase profits and revenues, Amazon is trying its’ own approach. Amazon is attempting to decrease the price of ebooks from $14.99 to $9.99 for consumers so that the writers, editors, and Amazon, it-self, can make more money.

This intrigued me because at first it seemed like the exact opposite of what a company should do, however, by applying economic, managerial, and marketing strategies I was able to decode this step taken by Amazon.

The concept of opportunity costs plays into accordance with this plan set forth by Amazon. By decreasing the opportunity cost of ebooks for the buyer, the buyer will then be more inclined to buy more ebooks because it would make them physiologically happier. This is due to Amazon dropping the prices of most ebooks from the current price of $14.99 to $9.99.

Managerial wise, increasing the demand for ebooks is the best option because it reduces almost every cost to $0.00. This occurs due to there no longer being shipping, printing, storing, manufacturing, ext. costs that are associated with printed books; thus maximizing profits.

After taking all of these factors into consideration, it clearly contrasts the traditional view that a higher price is better. Sometimes, like in this case, by decreasing prices you can increase the demand, and thus make a greater profit.

If you are intrigued about this move by Amazon click “here” to read the entire article.

-Gurinder Mahal

Works Cited:

In a growing, environmentally friendly, population, businesses are scrutinized based on the decisions their chair-holders make. These, said chair-holders, must then first analyze their steps and then all of the for-coming results prior to taking any actions. Therefore, business leaders are now compelled to use Business Ethics to make environmentally conscious, yet finically beneficial, decisions.

Business Ethics are ethical, or moral, decisions that one makes, or the entire company makes jointly. Here is an example of how a company used their business ethics to remodel an $11.4 billion dollar bottled water industry. One globally renowned company that has used these said business ethics to boost sales is Coca-Cola.

Coca-Cola is an enormous corporation with many daughter companies, one of which being Dasani. In 2009, Coca-Cola revolutionized the water bottle industry by releasing their new PlantBottle for their water brand Dasani.

The new PlantBottle uses 30% PET resin from sugarcanes, thus making it environmentally friendlier than the standard plastic bottle. The release of this new bottle boosted sales by a staggering 20%. The environmentally friendly bottle allowed for consumer product interest to rise, thus directly increasing revenue for the company. This bottle also created an elegant design, which caught my eye when I viewed it at the supermarket.

Business ethics are employed everyday in every case where a decision is made in a business. Depending on the scenario these ethics can either be harmful, or, as in this case, beneficial for the company. Personally, this marketing strategy expanded me insight on how business ethics are used in corporations and business.

If you are interested in learning more about Coca-Cola’s impacts on the water bottle industry here is an helpful link that I used.

http://www.forbes.com/sites/greatspeculations/2014/01/30/beverage-companies-go-green-in-hope-to-sell-more-water/

References:

“Beverage Companies Go Green In Hope To Sell More Water.” Forbes. Ed. Trefis Team. Forbes Magazine, 30 Jan. 2014. Web. 11 Sept. 2014.

-Gurinder Mahal