Introduction
Articulated in four parts, the following case study firstly identifies the sources of economic value for Medi-Cult (now branded Origio) which effect pricing strategy and connects them to accepted best practise principles. Economic value in marketing encompasses the rational, emotional and relationship benefits of a product as seen by stakeholders. Secondly, the study examines different methods of measuring customers’ perceptions of value. Thirdly, armed with the relevant actionable insight in the light of key issues and facts (that exclude insurance coverage, channels (clinics) and regulations) price recommendations are made to meet Medi-Cult’s overarching objectives, along with some brief thoughts about the ethical implications …show more content…
With skimming the company can set the highest price that a customer is willing to pay, customer value, and in response to high demand across the different geographies. This could work well for its two-three year advantage period, even though it will attract other rivals into the market with similar offerings which will mean an increased supply with eventually lower prices. However, if Medi-Cult had to lower prices– it would need to enhance its IVM with extra benefits otherwise patients may be led to believe that they were overcharged. Medi-Cult might wish to offer discounts on subsequent treatments for their loyalty. Because Medi-Cult has a two to three-year advantage, skimming would seem to be an attractive strategy pricing with a dose at $3000. At the same time, it could segment the market geographically – where demand, costs and competition vary – meaning that it would price differently in different markets based on how willing and able couples were to spend. This would lead to different pricing in different areas according to their elasticity, to maximise market share and profits which it needs to invest in R&D into new product development and
Articulated in four parts, the following case study firstly identifies the sources of economic value for Medi-Cult (now branded Origio) which effect pricing strategy and connects them to accepted best practise principles. Economic value in marketing encompasses the rational, emotional and relationship benefits of a product as seen by stakeholders. Secondly, the study examines different methods of measuring customers’ perceptions of value. Thirdly, armed with the relevant actionable insight in the light of key issues and facts (that exclude insurance coverage, channels (clinics) and regulations) price recommendations are made to meet Medi-Cult’s overarching objectives, along with some brief thoughts about the ethical implications …show more content…
With skimming the company can set the highest price that a customer is willing to pay, customer value, and in response to high demand across the different geographies. This could work well for its two-three year advantage period, even though it will attract other rivals into the market with similar offerings which will mean an increased supply with eventually lower prices. However, if Medi-Cult had to lower prices– it would need to enhance its IVM with extra benefits otherwise patients may be led to believe that they were overcharged. Medi-Cult might wish to offer discounts on subsequent treatments for their loyalty. Because Medi-Cult has a two to three-year advantage, skimming would seem to be an attractive strategy pricing with a dose at $3000. At the same time, it could segment the market geographically – where demand, costs and competition vary – meaning that it would price differently in different markets based on how willing and able couples were to spend. This would lead to different pricing in different areas according to their elasticity, to maximise market share and profits which it needs to invest in R&D into new product development and