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ATLANTIC COMPUT

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What price should Jowers charge DayTraderJofor the Atlantic Bundle (i.e. Tronn+PEA softw

Question 1

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commended Pricing Strategy

Vaue!in!use "ricing strategy

Cost #or $ % &in' #or 1%Tronn

Eectricity ()) $()Admin *))) $)))So+t,are 1()) -()Ser.er /*)) $)))Tota 0*)) ()))

Sa.ings **))()()

S"it $$))#ina

Assumption# $onser%ati%ely Tronn ser%er + PEA oftware is e&ui%alent to ' inc

Bene)ts#

Bene)ts

*igher percei%ed %alue y theof monitory ene)ts

*igher pro)t earning through sales increases

*elps in uilding a customer fstrategy

$ons

Priced '/ higher than the st(traditional! approach

$ustomer might not e awaprice is included in the prici

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Thin0 roadly aout the topline re%enue implications frthe four alternati%e pricing strategies. Appro1imately

money o%er the ne1t three years will e 2left on the tale

were to gi%e away the software tool away for free (i.E.4ricin %ersus utili5in one of the other ricin a

Question $

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6E7E89E :;P

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6E7E89E :;P

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6E7E89E :;P

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*ow is ;at5er li0ely to react to yourecommendation"

Question /

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$hris ;at5erPro)le

Jowers 6ecommendation#

7alue in 9se pricing

*ead of er%er di%ision '- yr %eteran of the computer usiness

>orce to e rec0oned with *as prepared se%eral reports on ser%er

mar0ets Wants ser%er to e sold along with

PEA ?i%es responsiility to Jowers to

prepare a pricing strategy for the

Atlantic Bundle $onser%ati%e Prefers the industry norm of gi%ing

away software free of cost along with*ardware

:ndustry 8orm $o $on%incing the cu

ene)ts and %aluereduced utilities ahardware

Pro)ts earned are $on%incing ales

$adena on selling

use pricing

;at5er@s 6eaction

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uestion *ow is $adena@s sales force li0ely to reato your recommendation" What can Jowe

recommend to get $adena@s hardware

oriented sales force to understand and sethe %alue of the PEA software eCecti%el

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Vaue 8ased "ricing : Reaction o+ saes +orce

alary

>i1(-

7a(F

Considera8e amount o+ saary is .aria8e

in +orm o+ commision

Seing t;e Atantic 8unde at t;e ne,

cost ,it; .aue 8ased "ricing ,oud get

t;e saes team ;ig;er commissions

T;oug;2 against t;e norm o+ gi.ing a,ay

so+t,are2 t;e 8unde ;as considera8ecost 8ene9ts

Saes+orce s;oud 8e ready to e.erage

on t;e ne, o

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*ow are customers in your target mar0et li0eto your recommended pricing strategy" Wha

can e ro%ided to o%ercome an o ect

Question (

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$9T=;E6 6EA$T:=8 I6E

$hallenges :nitial 6esistance due to per unithigher ac&uisition cost

6eluctance to pay for software astraditionally gi%en for free

6esolutions *igher Percei%ed 7alue

>ocusses on all the operational andadditional costs

how that PEA is the dri%er for lowcost

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*ow is =ntario in0@s senior management teto react to the Atlantic Bundle"

Question 6

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=8TA6:= :8@ 6EA$ompetitor 6esponse hort Term tactics li0e price reductions imilar product will e formidale when comined

with in0@s operational eGciency ;ay focus on direct sales more rather than relying

on online sales

Atlantic@s Perspecti%e