Customer Oriented Pricing BUS 5112: Marketing Management University of the People Introduction Medi-Cult is a Danish-based biotechnology company which manufactures and develops cell culture media for worldwide distribution with the sole aim of fertilizing eggs within a short period of time without having any adverse side/negative effect on women. In this case analysis, it focuses mainly on customer-oriented pricing exercises. Russ Winer from New York University brings our attention to a new development in bio-medical science which significantly reduced the time needed to mature an egg from 30 days to just 21 days. These products are In Vitro Fertilization (IVF) and the new alternative is In Vitro Maturation (IVM). The sources of economic value for IVM which is the new product, and IVF the existing product will be critically examined. The second task is to determine the type of person/couple that would be willing to pay for a cycle of IVM. This will be best answered under market segmentation. Then what price will be paid for a circle of IVM. This segment will be answered by utilizing a pricing strategy which is put in place by the organization. In determining the …show more content…
The Five forces: attribute of organization forces lies on the advantage one has against the other. The other force is the rivalry in terms of supplier power, this is the degree of influence one had against the other IVM which has 2 -3 years supply advantage over IVF. The market worth of IVF is $1billion worldwide. Then to consider the buyers purchasing power, who are the categories of those that can guard the price. IVF is lower in cost to IVM, medium price per dose of IVF is $50 against $500 for IVM. Then comes the threat of substitute which anchors on the availability of substitute and threat of integrations of the
• Finance: Depending on how much the customised solution costs The benefits of each of the products/services to the user
Beginning in the mind of a troubled and delusional science fiction author, Scientology has grown to become one of the most controversial body of beliefs since the dawn of its creation in 1960. The Church of Scientology uses marketing technics to lure men and women into its cult-like sector and, while doing so, ruins the lives of everyone in its wake. Although the Church of Scientology claims to help the human condition by ridding the minds of its followers of terrible past life experiences so that they may reach their untapped potential, the Church of Scientology is a profit-making cult driven by greed, power, and gaining a worldwide following and ultimately ruins the lives of its followers. Science fiction writer L. Ron Hubbard created Scientology
The Porter five force model looks at the following aspects: 1. The level of rivalry in the market 2. The availability of substitute products 3. The threat of new entrants that may join the market 4. The power of buyers
Each of the forces is determined how competitive in that industry as well as the structure of the industry. Porter’s five forces factors are consists of competitive rivalry, the threat of new entrants, the threat of substitutes, bargaining power from
4.4 Pricing Strategy For a number of reasons, price is one of the most important aspects of an effective marketing strategy (Gerstein & Friedman, 2015). First, price is the only marketing variable that generates revenue. Second, buyers see price as an attribute of value (Tanner & Raymond, n.d.). Consequently, an organization must carefully assess its internal and external environment to choose the most effective pricing objective, which—in turn—will drive a product’s initial pricing strategy.
This theory is based on the concept that there are five forces that determine the competitive intensity and attractiveness of a market. Porter 's five forces help to identify where power lies in a business situation. This is useful both in understanding the strength of an organization 's current competitive position, and the strength of a position that an organization may look to move into. Strategic analysts often use Porter’s five forces to understand whether new products or services are potentially profitable. By understanding where power lies, the theory can also be used to identify areas of strength, to improve weaknesses and to avoid mistakes.
3 Porter’s Five-Forces Model Analysis Different factors can be combined together in a simple business model. This is known as Porter’s Five-Forces Model and competitive circumstances of an industry can be analyze through this model. These five forces are critical forces that they determine the attractiveness and competitiveness of an enterprise and have influence on a firm’s profitability in its industry. The five-forces analysis can not only show how Walt Disney company builds a sustainable competitive advantage in Entertainment-Diversified industry but also can seize business opportunities in future development.
Threat of a Substitute Products or Services The threat of alternatives is comparatively low. However the how the service is used in different parts of the world is the driver of substitutes in the
The pricing strategy or pricing policy is one of the most important managers make for a product as it affects the profitable outcome and competitiveness that a product may make. (Toni, 2017). A business can use a variety of pricing strategies when selling a product or service. The price can be set to maximize profitability for each unit sold or from the market overall. It can also be used to defend an existing market from new entrants, to increase market share within a market or to enter a new market by dropping the price or offering more benefits with the device such as packages.
PORTERS FIVE FORCES ANALYSIS - PHARMA INDUSTRY Using Porter's Five Forces we can analyse the scope of the pharmaceutical industry. It looks into five factors namely, competitive rivalry, threat of new entrants, threat of substitute products, bargaining power of suppliers and bargaining power of customers. " Competitive rivalry: The pharmaceutical industry is highly fragmented with almost 3,000 pharma companies and 10,500 manufacturing units. Due to increasing demand of high-quality drugs, low-to-moderate entry barrier to the new entrant, the presence of a number of large and small firm this market is highly competitive.
Market penetration pricing is about setting a lower price on our product with aim to attract customers to buy our product because of the cheaper price compare with other competitor. In our ice cream industry, we have many competitors such as Gelato and Llaollao, so we can use this strategy to stand out among other competitor and draw attention from the customers. After we had successfully penetrated into the market, we will slowly raise back our price to our normal pricing. (A. Pahwa, 28 January
To access the industry in which Apple operates, we use the 5 Forces Matrix. This will help us to achieve a broader understanding of the industry itself, and how Apple in particular survived and become one of the most successful companies. Porter’s 5 Forces Analysis: 1. Rivalry among existing competitors – High. The industry is characterized by very intense and fierce competition against players like HP, Dell, Acer and etc.
Porter’s five forces model To analyse the microenvironment facing United Biscuits in China, Porter’s five forces model is selected to provide an understanding of the competitive forces, to determine the competitive position of the company and profitability within the biscuit industry whilst offering a framework for predicting and influencing competition over time (Porter, 2008, p.80). The findings are explained below: Threat of new entrants • The high capital cost required for investing in developing distribution, sales network and acquiring production equipment could deter new entrants. The barriers are high when capital is necessary for unrecoverable expenditures such as marketing and product development capability which is difficult for new entrants to succeed in the short-term (Euromonitor, 2014; Porter, 2008, p.81).
Competitor Analysis Marigold, is the market leader in fresh dairy and beverage market in Malaysia, however it is not entirely dominated by its own brand. There is existence of a few numbers of beverage and fresh dairy milk competitors. Dairies products are considered very low degree of differentiation with competitors. Therefore, customers are allowed to compare products’ quality and especially price, is the factor that customers considered the most between the competitors’ products. The intensity of competition in dairy industry is very tough (UK Essays, 2015).
3.2 Industry conditions (Porter 's Five Forces Analysis) Five forces which would impact an organization 's behavior in the market. Understanding the nature of these forces provides organizations the required insights to enable them to formulate the appropriate strategies to be successful in their market (Thurlby, 1998). 3.2.1 Threat of new entrants (high entry barriers) High capital investment for competitor entry into telecommunication industry. Companies in this industry maintain development, spend fairly large amount of capital on network equipment and incurred high fixed costs. Besides, technologies are also considered as barriers for new companies to enter the market.