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Unit 4 Business Environment - Investigate the behaviour of organisations and the market environment

Behaviour and strategies adopted by firms

What competitive strategies can organisations use to improve market performance?

Pricing Strategies

These are strategies used by firms to improve market performance, the only factor relating to the product which is changed is price.

Price Wars


Destruction Pricing

Expansion Pricing

Penetration Pricing

Non-Pricing Strategies

Pricing is just one way to improve market performance, non pricing strategies involve other techniques to improve market performance. Also take a look at the Marketing unit.

Is price important?

The Italians produce Fiat cars, which was one of the cheapest new cars in the UK. However the most popular new cars are Fords!

What are non-pricing strategies?

When consumers go shopping, they do not base their buying decisions just on price, they consider other factors.

Non-Pricing strategies are used by companies to increase sales, expand market share, retain existing and attract new customers. . .

Non-Pricing strategies are methods and techniques used by firms that don't involve a change in the price of the product.

Promotion is important. . .

Promotions and offers are also important to consumers when choosing products.

They will be "tempted" by:

Advertising is important. . .

Advertising through the media, can make products more attractive and persuade people to purchase them.

Advertising can create in peoples' minds an image for a product. . .

Branding is important. . .

Branding is a valuable marketing tool. Branding is the creation of an identity for a company or product.

Branding allows companies to maintain their current market status and enter or create new markets. . .

Non-Pricing Strategies can be found in all of the four types of markets: monopolistic, oligopolistic, competitive and even non-competitive markets.

However Non-Pricing Strategies will be found most strongly in oligopolistic markets and will be a feature of competitive markets


A good example of Non-Pricing Strategies are those employed by the computer firm Apple in trying to sell their Powerbook at the end of the 1990s

It was used in the film Mission Impossible and was then promoted in a range of TV adverts using clips from the film. . .

This website will self-destruct in five seconds.....

Sony did something very similar with the James Bond film, Casino Royale, they used the film to promote many of their products.

Shaken not stirred...


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Book Recommendation

HNC/HND Business Core Unit 4: Organizations, Competition and Environment: Study Text (2000) - Buy it
Part of the HNC/HND business series, this text on organizations, competition and environment features a blend of topic coverage and practice opportunities with BTEC guidelines, key definitions, timed activities and assignments, and topics for class discussion. It is suitable for both classroom and individual study. Buy it from

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