Marketing, Pricing & Sales Flashcards
Which factors should be considered in setting a price on a MVP?
• Maximum price
o Restricted by the value crated by your MVP
• Minimum price
o Restricted by the costs for producing MVP
• Customers status quo
o How do they solve the same problem today, without MVP.
• Competition
o What is your customers price compatison point and alternatives to MVP.
• Market penetration strategy
o Price skimming or low price market penetration?
• Value sharing
o How much of created value is paid to you and kept by your customers?
What is the bowling alley Principale?
Expanding your market, niche by niche
• Your first market niche is your first customer using your MVP.
• You can expand to additional market niche, by adding functionality to you MVP, making your product more useful for customers in your present market segment.
How do firms use their launch timing strategy?
A firm can use its launch timing strategy to take advantage of business cycle or seasonal effects, to influence its positioning vis-à-vis competitors, and to ensure that production capacity and complementary goods are sufficiently available at time of launch.
What are common pricing strategies for technological innovation?
Market skimming and penetration pricing
What is market skimming?
Set a high price, and lower the price during the years after to be able to adapt to the market.
What is penetration pricing?
Setting a low price and not making enough money to be able to get into the market and then up the price.
Why use pricing strategies?
Pricing strategies should consider the firm’s ability to earn profits from sales of complementary goods or services—if profits from complements are expected to be high, lower prices on the platform technology may be warranted.
