Virgin Mobile
Virgin Mobile Paper
A Case Study Analysis Presented to:
1
I.
CASE SUMMARY
Virgin, a U.K. based company led by Sir Richard Branson, has had a history of brand extension resulting to 200 different corporate entities. One of which is Virgin Mobile which has decided to expand to USA based on their success in the U.K. market. Dan Schulman, Virgin Mobile USA CEO, is tasked to lead the expansion to the U.S. and has decided to focus on consumers aged 15-29 given that there is low penetration in this market and growth rate is projected to be robust in the next five years. However, Dan is facing a difficult task on identifying the best pricing strategy that can help them compete with the existing national carriers and also to ensure that they can attract and retain their target customers.
II.
POINT OF VIEW
The point of view to be taken in this case is Dan Schulman’s given that he is leading the expansion of Virgin Mobile in the U.S. as acting CEO.
III.
STATEMENT OF THE PROBLEM
What is the most effective pricing strategy for Virgin Mobile USA in order to attract and retain their target number of subscribers?
IV.
STATEMENT OF OBJECTIVES
Our case analysis paper aims to achieve the following objectives: 1. Achieve total of 1 million subscribers at the end of its first year and 3 million at its 4th year. 2. Create an appealing pricing offer that can take off in a saturated market. 3. To ensure maximum profitability for the Company with its pricing strategy.
V.
ASSUMPTIONS/AREAS OF CONSIDERATION
1. Virgin Company stands for value for money, quality, innovation, fun, and a sense of competitive challenge. These core values have helped the company to expand to 200 different portfolios and have achieved success in their expansion in mobile industry in the U.K. 2. Virgin Mobile is the country’s first mobile virtual network operator which leased network space from another firm, Deutsche Telekom. This enables them not to worry about huge
A Case Study Analysis Presented to:
1
I.
CASE SUMMARY
Virgin, a U.K. based company led by Sir Richard Branson, has had a history of brand extension resulting to 200 different corporate entities. One of which is Virgin Mobile which has decided to expand to USA based on their success in the U.K. market. Dan Schulman, Virgin Mobile USA CEO, is tasked to lead the expansion to the U.S. and has decided to focus on consumers aged 15-29 given that there is low penetration in this market and growth rate is projected to be robust in the next five years. However, Dan is facing a difficult task on identifying the best pricing strategy that can help them compete with the existing national carriers and also to ensure that they can attract and retain their target customers.
II.
POINT OF VIEW
The point of view to be taken in this case is Dan Schulman’s given that he is leading the expansion of Virgin Mobile in the U.S. as acting CEO.
III.
STATEMENT OF THE PROBLEM
What is the most effective pricing strategy for Virgin Mobile USA in order to attract and retain their target number of subscribers?
IV.
STATEMENT OF OBJECTIVES
Our case analysis paper aims to achieve the following objectives: 1. Achieve total of 1 million subscribers at the end of its first year and 3 million at its 4th year. 2. Create an appealing pricing offer that can take off in a saturated market. 3. To ensure maximum profitability for the Company with its pricing strategy.
V.
ASSUMPTIONS/AREAS OF CONSIDERATION
1. Virgin Company stands for value for money, quality, innovation, fun, and a sense of competitive challenge. These core values have helped the company to expand to 200 different portfolios and have achieved success in their expansion in mobile industry in the U.K. 2. Virgin Mobile is the country’s first mobile virtual network operator which leased network space from another firm, Deutsche Telekom. This enables them not to worry about huge
References: Nagle, T., Hogan, J., & Zale, J. (2011). The Strategy and Tactics of Pricing (5th edition). New Jersey: Prentice Hall. 8