Marketing-Pricing Cases

Topics: Pricing, Marketing, Marketing research Pages: 6 (1446 words) Published: August 22, 2011
Course Module in Marketing Management
Course Modules help instructors select and sequence material for use as part of a course. Each module represents the thinking of subject matter experts about the best materials to assign and how to organize them to facilitate learning. Each module recommends four to six items. Whenever possible at least one alternative item for each main recommendation is included, as well as suggested supplemental readings that may provide a broader conceptual context. Cases form the core of many modules but we also include readings from Harvard Business Review, background notes, and other course materials. I. Overview of suggested content (HBS cases unless otherwise noted) Title 1. Module Overview Principles of Pricing (HBS note) and Colonial Homes Supplement: Marketing Analysis Toolkit: Pricing and Profitability Analysis (HBS note) 2. Behavioral Pricing Note on Behavioral Pricing (HBS note) and Tweeter etc. Alternative: Coca-Cola's New Vending Machine (A): Pricing to Capture Value, or Not? 3. Value-Based Pricing Atlantic Computer: A Bundle of Pricing Options (HBP Brief case) Alternative: Curled Metal Inc.-Engineered Products Division 4. Pricing Structure Virgin Mobile USA: Pricing for the Very First Time Alternative: XM Satellite Radio (A) American Airlines, Inc.: Revenue Management Dolan & Gourville Bell & Nashem Steenburgh & Avery 506021 190008 511028 2005 1989 2010 10p 8p 8p ---Author Product Number Publication Year Pages Teaching Note

Gourville Gourville & Wu King & Naraynadas

599114 597028 500068

1999 1997 2000

12p 24p 9p

-597082 --

Bharadwaj & Gordon Shapiro & Cespedes

2078 709434

2007 2008

10p 14p

2079 709501

McGovern Godes & Ofek

504028 504009

2003 2003

19p 25p

504108 504082

5. Yield Management and Revenue Pricing Dhebar & Brandenburger 190029 1989 13p 190192

Alternative: Name Your Own Price Supplement 1: How To Reap Higher Profits with Dynamic Pricing (Sloan article) Supplement 2: Pricing and Market Making on the Internet (HBS note) Mars Inc.: Online Procurement (Ivey case)

Dolan Sahay

500070 SMR254

2000 2007

12p 10p

501046 --

Dolan & Moon





6. Auctions and Online Procurement Bell 905E04 2005 6p 805E04

II. Rationale for selecting and sequencing the items in this module In Section 1 the Principles of Pricing note, based on the earlier Pricing: A Value-Based Approach (500071), conceptualizes pricing in terms of objective value, perceived value, and costs. It addresses in detail how to determine objective and perceived value, along with price sensitivity and price customization, before bringing the analysis back into the context of the other 3 P’s and the wider marketing strategy. In the Colonial Homes case, the company in question is presented with an unexpected increase in the cost of raw materials, and must decide how adjusting its price to cover at least some of the increase will affect customer demand and profits, or whether it would be less unprofitable to change suppliers. For students who are not yet familiar with the necessary mathematics, the suggested supplement Market Analysis Toolkit: Pricing and Profitability Analysis discusses how to draw a demand curve and calculate costs, optimal prices, and profit. In Section 2, Note on Behavioral Pricing extends some remarks at the end of Principles of Pricing concerning ethical and legal factors in pricing. It argues that businesses downplay considerations of fairness when pricing, and pay dearly for it. One cannot determine customer willingness to pay without attending to behavioral and psychological factors that seem to fall outside of a purely economic calculus. The Tweeter etc. and alternative Coca-Cola's New Vending Machine cases exhibit the influence of behavioral factors in pricing and mispricing. The cases in Section 3 illustrate value-based pricing. In Atlantic Computer: A Bundle of Pricing Options, a...
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