A Bundle of Pricing Options
Atlantic computer’s most important goal is to increase profitability by selling ‘Tronn with PESA’ packages to consumers who want to operate web sites or share files. Among 4 price alternatives suggested in the case, the price based on value-in-use pricing analysis will be charged for ‘Tronn with PESA’ package. To achieve this goal, the company should overcome some impediments; one is that consumers are not accustomed to paying more money for the software tool such as PESA, and the other is that the company does not have sales structure for its new product. To overcome these problems, the company can make the new server product category and differentiate the package from other basic servers. Also, it can sell the product online to solve the problems occurred by lack of sales structure for selling basic server.
Atlantic computer’s top priority is to increase profitability by selling ‘Tronn with PESA’ packages at a price based on value-in-use pricing to consumers who want to use basic servers for operating web servers and sharing files. The calculated price is $4,200, which is more than twice the current price, 2,000$. The company will gain much more profit by charging the value-in-use price for ‘Tronn with PESA’ package. Others might say that Atlantic computer should more focus on increasing its market share in the basic server market. However, we are not insisting that the company give up the market share because it can provide not only ‘Tronn with PESA’ package for consumers whose purposes are operating web sites or sharing files, but also ‘Tronn’ server alone for the other consumers. Although the sales of ‘Tronn’ alone may decrease if other competitors, especially Ontario’s Zink, cut the price of their products, consumers who want to use the ‘Tronn with PESA’ package for their web sites and file sharing are large enough.# So the company’s market share will...