Sec 03

MKT 201: Principles of Marketing

Mr. Husain Salilul Akareem

Samiya Yesmin 11304043, Jannatul Ferdous 11104096, Tabassum Anwar 11104116

7/3/2012

Assignment on Case study of “Ollo internet Service” internet service and how to apply product mix pricing strategies on it to maximize profit.

Product Mix Pricing Strategies are on products that are already available in the market. It is of five types, which we will apply to “Ollo internet Service” as follows:

i. Product-Line Pricing: This is setting prices across an entire product line. Like for “Ollo internet Service” that provides internet services, we will design different types of internet speeds and usages with varying prices such as below:

Weekly Plan Speed Usage Price

Steady 256 Kbps0.5 GB BDT 991.0 GB BDT 149

Fast 512 Kbps0.5 GB BDT 1291.0 GB BDT 200

ii. Optional Product Pricing: This is pricing optional or accessory products sold with the main product to maximize profit. Like “Ollo internet Service” provides two accessories, Cradle and Cable, which come with different prices to be used with their Dongle. So if you want you can choose either or neither.

iii. Captive-Product Pricing: It is pricing the products that must be used with the main product. So to use “Ollo internet Service” we need to use either one of the following products, whose uses vary with its prices.

CPE Free Usage Volume (GB) Price (BDT)Dongle 3.0 1,489Indoor 3.0 4,834Outdoor 3.0 9,989WiFi Router Unlimited 6,999

iv. By-Product Pricing: It is pricing the low-value by-products to get rid of them and to make the main products price competitive. As services do not produce any by-products we cannot apply this strategy for “Ollo internet Service”.

v. Product-Bundle Pricing: Pricing bundles of products, which includes slow moving and fast moving products, to be sold together. Such as “Ollo internet Service” making monthly packages to not only sell

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different speeds with different usage sizes but also different accessories such as follows.

Monthly Plan Speed Usage CPE Price

Steady256 Kbps

2.5 GB Dongle BDT 2,0004.0 GB Dongle + Cradle BDT 5,0006.0 GB Dongle + Cable BDT 5,500

Fast512 Kbps

3.5 GB Dongle + Cradle/Cable BDT 8,0006.0 GB Dongle/ Indoor BDT 9,00012.0 GB

Dongle/ Indoor /OutdoorBDT 14,000

30.0 GB

Indoor /Outdoor/ WiFi Router

BDT 16,000

As we know product mix pricing strategy is applied to products that have already crossed their growth stage and are entering the maturity stage. That is why we are trying to price our services to beat the competition and to encourage the customers to switch brands. And we believe to do this we should follow the product bundle pricing strategy which would lead to maximizing our profits while defending our market share.

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