Managing Business Marketing & Sales Professor Waldemar A. Pfoertsch 弗沃德 Term 4/MBA 2006 Oct , 2007
Group Project 40 % Max. 3 Students, Max. 20 pages Academic paper on a Business marketing topic of interest to the group (format Journal of Marketing), or a case study based on your own experience/company interviews and an analysis of the resolution – due date November 2
Project ideas please submit till Friday …
Learning Of Today: Dynamics of Pricing China Pricing abroad Selected Pricing issues Price wars Case: –Trilogy Corporation –Texas Instruments
China Pricing Abroad Global competition Changes of the local conditions Exchange rate fluctuations
Plus expected exchange Rate fluctuations of 5% Plus existing exchange Rate differences to the EURO of 25% Financial Time, Oct. 16, 2007
Labor & Material Cost are rising Financial Time, Oct. 16, 2007
The power in industrial power tool brands
TTI Financials
Intel Changes Its Competitive Pricing For Microprocessors Innovation Leader Ingredient Branding Price Leader
Price as part of a total offering - the value statement to the customer The key idea is to set price level in such a way that superior value is created for customers. Value is composed of benefits received by customers, less the customers’ costs. These costs include the price of the product or service.
Objectives Addressed by Pricing Strategic Purposes Achieving a target level of profitability Building goodwill, or relationships, in a market or among certain customers Penetration of a new market or segment Maximizing profit for a new product Keeping competitors out of an existing customer base
Objectives Addressed by Pricing Tactical Purposes Winning the business of a new, important customer Penetrating a new account Reducing inventory levels Keeping the business of disgruntled customers Encouraging customers to try a product or service Encouraging sales of complementary products
Time Pricing Throughout the Product Life Cycle and the Technology Adoption Life Cycle Penetration Pricing Price Skimming Competitive Pricing Price Skimming
Other Pricing issues Pricing in Translation Mode Pricing for International Marketing Efforts Tactical aspects –Bundling –Discounts –…
Price Wars Northwest: “Grown-Ups With Kids Fly Free” American Airlines: 50% cut for 3 month Others matched Result: SOLD OUT!
Pricing Techniques Yield management “Every day low price” AA “Value Pricing”
Texas Instrument: Global Pricing 1.What is TI’s current approach to pricing of semiconductors? 2.How is TI organized to manage its current pricing policy? In the US and outside the US? 3.Why is Arrow requesting “global pricing”? What is meant by global pricing? 4.What would be the implications of “Global Pricing”?
Case Questions: Trilogy Corporation Please Check the Case Study. Questions are at the end of the case.
Real Case, Real People Joe Liemandt
Trilogy’s Vertical Offerings
Trilogy’s Fast Cycle Time Approach
Example of Trilogy’s Business Success Metrics
Comparison of Pricing Approaches
Classification of selected value-based Pricing Mechanism
Comparison of pricing approaches
Thank you! 谢谢！ Waldemar Pfoertsch Professor Business Marketing CEIBS 699 Hongfeng Road, Shanghai China