Human Behavior
                            and Its Impact
                         on Business Practices
                 ...
Structure


                     • Story - Chapter Hybrids
                     • Classical - Behavioral Seamlessness
    ...
Methodology
                     • Primary Information
                         • Personal Observations
                  ...
How do marketeers work around
                          Diminishing Marginal Returns?




                     • What is D...
• Plate System - Chunks
                       of Utility
                     • Experienced & Expected
                  ...
How do economic concepts explain
                           Chache Di Hatti Closing Early?



                     • Histo...
• How?
                      •      Price Ceiling

                     • Why?
                         •   Wider Demograp...
HP/Gillette Marketing Strategy of
                             Lowering/Eliminating Prices

                     • Click-W...
• Gillette - MACH III Confidence Challenge
                     • HP - Very Low Pricing
                     • Things In Co...
• How Does it Work?
                         •   Click/Whirr Triggers
                             •   Reciprocity

      ...
How are Pricing Models for Windows 7
                              Profit Maximizing?



                     • Consumer’s ...
!
Saturday 24 April 2010
• Upgrade Editions
                     • OEM Editions


Saturday 24 April 2010
What is common to BITSAA
                  International, Cypress University Alliance,
                         and UPSC C...
• Click/Whirr In Action
                         • Commitment/Consistency
                         • Social Proof
        ...
What can PVR Cinemas Learn from Air
                         Deccan & Investment Banks?

                     • What Did A...
• Why with Cinema Halls?
                         • High Fixed Costs, Low Variable Costs
                         • Simila...
• Cinema Hall Issue - Sell A Show
                         •   Hall Owner and Prospective Customers Negotiate a Price for ...
Object Oriented Management (Intro)




                     • Computer Programming & Management
                         •...
• Abstraction
                         •   Breaking down Big Problems into Mutually Exclusive-Collectively
               ...
• Encapsulation
                         •   Hiding specific details of functions from the function which sends
           ...
Why do all good things come to an end?




                     • Diminishing Marginal Returns



Saturday 24 April 2010
Thank You!


                     • Questions?



Saturday 24 April 2010
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Behavioral Economics & Impact on Business Practices

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Behavioral Economics & Impact on Business Practices

  1. 1. Human Behavior and Its Impact on Business Practices Akhil Mehta 2006B3A8645G Saturday 24 April 2010
  2. 2. Structure • Story - Chapter Hybrids • Classical - Behavioral Seamlessness • Natural Language Saturday 24 April 2010
  3. 3. Methodology • Primary Information • Personal Observations • Interview • Secondary Information • Books • Courses • Newspapers • WWW Saturday 24 April 2010
  4. 4. How do marketeers work around Diminishing Marginal Returns? • What is DMR? • Why Not Constant? • When to Stop? Saturday 24 April 2010
  5. 5. • Plate System - Chunks of Utility • Experienced & Expected Utility OR • Buyer’s Quantity, Money) (Need, Remorse Saturday 24 April 2010
  6. 6. How do economic concepts explain Chache Di Hatti Closing Early? • History • A Typical Day • Customer Cross- Section Saturday 24 April 2010
  7. 7. • How? • Price Ceiling • Why? • Wider Demographic • Scarcity - Queues & Brand • Time Gain Saturday 24 April 2010
  8. 8. HP/Gillette Marketing Strategy of Lowering/Eliminating Prices • Click-Whirr Responses • Too Much/Too Less Information • Non Intuitive Information • Uncertainity • Examples • Scarcity • Reciprocity • Commitment/Consistancy • Social Proof Saturday 24 April 2010
  9. 9. • Gillette - MACH III Confidence Challenge • HP - Very Low Pricing • Things In Common • Refillable Commodities • Proprietary Refill Technology • Refill Costs Significantly Higher than Competition Saturday 24 April 2010
  10. 10. • How Does it Work? • Click/Whirr Triggers • Reciprocity • Commitment/Consistancy • Increase in Number of Printers/Razors in Target Demographic’s Hands • Rightward Shift in Complementary Good’s Demand Curve Saturday 24 April 2010
  11. 11. How are Pricing Models for Windows 7 Profit Maximizing? • Consumer’s Surplus • Producer’s Surplus • Differential Pricing • Examples (Water,Vegetables, Extortion Money) Saturday 24 April 2010
  12. 12. ! Saturday 24 April 2010
  13. 13. • Upgrade Editions • OEM Editions Saturday 24 April 2010
  14. 14. What is common to BITSAA International, Cypress University Alliance, and UPSC Chaat Bhandar? Saturday 24 April 2010
  15. 15. • Click/Whirr In Action • Commitment/Consistency • Social Proof • Reciprocity • Amplified By • Too Much Information • Uncertainty • How It All Connects Saturday 24 April 2010
  16. 16. What can PVR Cinemas Learn from Air Deccan & Investment Banks? • What Did Air Deccan Do? Saturday 24 April 2010
  17. 17. • Why with Cinema Halls? • High Fixed Costs, Low Variable Costs • Similar Target Demographic • Differential Pricing already exists, Profits Leaking • Recommendation • Use Model A/B Depending on Situation • Make Tickets Non-Transferrable • Implications • Comparatively Greater Profits, Hit or Flop! (Tickets & More) Saturday 24 April 2010
  18. 18. • Cinema Hall Issue - Sell A Show • Hall Owner and Prospective Customers Negotiate a Price for the show • Issue Purchaser decides Price, Uses Ticket Window + Own Network for Distribution & Mitigates Risk for Hall Owner • Extra Revenues are his/her to keep • Has Precedent In Airlines Industry Saturday 24 April 2010
  19. 19. Object Oriented Management (Intro) • Computer Programming & Management • Solution Development Approaches • Similar Paradigms may work in both • Translating selective concepts from OOP and finding managerial equivalents Saturday 24 April 2010
  20. 20. • Abstraction • Breaking down Big Problems into Mutually Exclusive-Collectively Exhaustive Sub-Problems • eg. Arranging a Guest Party has Making Tea as a Sub-Task • Making Tea too has sub-tasks, and Arranging a Guest Party may be part of an even bigger piece of work • In Programming, Implemented Using Functions - eg. Multiplication Table Program uses * function Saturday 24 April 2010
  21. 21. • Encapsulation • Hiding specific details of functions from the function which sends messages to it • Especially Useful in Delegation and Outsourcing • Frees up Resources, both Human (in Management) and Computer • eg. Household Help who makes Tea In the Guest Party Saturday 24 April 2010
  22. 22. Why do all good things come to an end? • Diminishing Marginal Returns Saturday 24 April 2010
  23. 23. Thank You! • Questions? Saturday 24 April 2010

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