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Firms with market power can raise price without losing all customers to competitors” (Brickley, J. A., Smith, C. W., & Zimmerman, J. L., 2016).  In the video "How to Raise Prices without Losing Customers" Bob Prosen outlines four concepts to justify raising prices (1) provide advance warning, (2) demonstrate increase value to customers, (3) track the quality of their product, and (4) maintain relationships.  I believe the four concepts complement each other and the company would have a hard time (even with strong market power) to raise the prices and maintain their profit margins if they are not practicing these four concepts.  Companies that provide superb customer service will have that customer for life.  And if they have that customer for life, the customer is ok with a price increase as long as the quality of the product remains the same or increases.  And typically, a company with good consumer relations will provide an advance warning they are going to raise their prices.  Customers can also expect to see an increase in the product’s value with the price increase. 

            When I think of a company that embodies all four of the concepts Prosen outlines, Walt Disney World Corporation comes to mind.  Disney World has always provides their customers with an advanced warning when the ticket prices are going to go up.  Customers can see the value in the Disney World “product”.  The parks are continually updating, and the company is constantly adding new attractions that fall in line with their current feature films.  Disney World IS customer service, and they go above and beyond to “Make every customer feel important.  Disney employees are trained to be “Assertively Friendly.”  Disney team members are encouraged to actively seek contact with guests” (Gallo, 2011).  And for Disney World to continue to do what they do, they have to track and review the quality of their product continually.  In my opinion, Disney World’s strongest asset is the ability to reach out and provide their services to such a broad range of customers.  They have something for people of all ages.  The price of single day admission to Magic Kingdom theme park has gone from $3.50 in1971 to $130 in 2017 and the Magic Kingdom had over 20 million visitors in 2015 (Pedicini, 2016).  This just goes to show, people love something that crazy mouse is doing and they are willing to pay for it. 

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Bob Prosen’s advice to increase prices is dependable, simple and manageable. He understands that customers are the focus so he tailors his business practices to meet their needs. Bob Prosen (n.d.) listed his four basic concepts for increasing price as, “providing advance warning, the customer should see increased value, track the quality of your products, and relationship matter” (MSNBC). By keeping customers aware of any potential price changes allows them to brace and adjust plans to minimize financial damages.  Organizations tend to focus heavily on profits and tend to neglect their customer's happiness. Even though a price increase is never seen as positive by adding value to a product customers tend to project a more favorable response. Bob mentioned, “that customers should see increased value not just price increase” (MSNBC). Perception of product’s value is vital in keeping customers from venturing to other organizations.  When customers perceive a product’s value being equal or higher than the price paid they tend to view it as a deal. The other half in keeping customer’s happy is high product quality. High product quality is managed through tracking of all customer’s complaints, calls, and returns.  Before considering increasing prices, organizations should look internal. In many cases, firms can reduce operational cost by streamlining processes or procedures, switching suppliers, or cutting fixed cost.

    An organization must have an optimal market power even to attempt increasing prices. Without having an absolute advantage in the market, groups who raise price only cause damage to themselves. Distinguishment of their product from their competitors will afford them that advantage which will allow for a price increase. The value customers gain from their product should be related to the price. As stated in our book, “a firm has market power when it faces a downward-sloping demand curve. Firms with market power can raise prices without losing all customers to competitors” (Brickely, Smith, & Zimmerman, 2004, p. 161). Without a distinct advantage, an organization is bound to lose market shares and customers. The market leader sets the standards for price, value, and quality. The followers tend to maximize their profits by taking advantage of the leader’s weakness. To further advance a firm’s grasp, a SWOT analyses (Strengths, Weakness, Opportunities and Threats) must be conducted to define their opportunities. Still, businesses can maximize profits by either cutting unnecessary business processes or reducing overhead.