Questions
What would a potential new price/payment method be that could be revolutionary? If a company is...

  1. What would a potential new price/payment method be that could be revolutionary?
  2. If a company is operating at a deficit, but has happy customers, what would the best strategy be to make money?
  3. Why should a company’s pricing strategy reflect their core values ?
  4. Should consumers make it a point to review a company’s core values before investing?

Product pricing is one of the most important determinants of company success. A product’s market price must account for numerous competitive factors, including research and development costs, target market size, lifetime customer value, marketing and acquisition costs, and competitive positioning. Yet for all the complexity involved in determining ideal pricing, a Chargebee and ProfitWell survey of software founders and executives found that companies spend an average of just 12 hours on their pricing. Not 12 hours for each product — just 12 hours total in the history of the company.

One reason for the disconnect between pricing’s impact and the time invested could be difficulty in understanding pricing strategies. As recently explained in a guide by Cobloom, the software as a service market employs a variety of pricing models (e.g., flat rate, usage based and tiered), strategies (e.g., free trials) and psychological pricing tactics that impact how buyers process pricing information. Such psychological tactics include tricks like charm pricing (featuring amounts that end in nine, such as $39 instead of $40) and decoy pricing that places an obviously less desirable option among three bundled packages to increase the perceived value of the other options.

While these strategies might seem obvious or purposefully deceptive, they continue to be used, because they work. Research has found that decoy pricing generates additional revenue. And if you think no one falls for charm pricing, guess again. A famous study by researchers at the University of Chicago and MIT found that an item of clothing marked $39 outsold identical items priced at $44 or even $34.
As CFO, I focus on developing pricing that supports customer acquisition and long-term fiscal stability. But as part of a purpose-driven leadership team, our product pricing is also viewed through the lens of our corporate values considering shared customer value and sustainability. While we are absolutely driven by revenue, we also gut check our decisions against core company values. Below are some of these values and how they can help your company’s own pricing strategy.

1. Put customer value first.

Many of the widely used technology pricing strategies focus heavily on company revenue and internal metrics rather than end-user value. As an example, many companies take the simplified approach of calculating their product development and production costs and then adding their desired margin, and they use that information to set pricing. Unfortunately, this model is based entirely on internal metrics that have no connection to customer preference, price sensitivity or even competitive pricing. Another widely used example is pay-per-feature pricing. This model relies on a core set of features to entice new customers and adds charges as users evolve and want more advanced functionality. While it offers companies a reliable growth channel, this kind of pricing tends to create resentment with users who are paying for a product and can’t access all of its features.

Putting customer value first requires an innovative, research-based approach to understanding how end users will be using your product, as well as flexibility in designing pricing structures to take into account different product usage rates and feature consumption between departments and locations. Some examples of innovation in pricing include companies such as Amazon Web Services, Uber or Airbnb with prices based on actual usage. The only drawback to this approach is it can lead to higher-than-expected bills when customers need to add capacity or service during popular or “surge” time frames. And while these strategies might work for the vendor, research indicates consumers and technology buyers prefer the simplicity and predictability of flat-rate pricing
2. Keep your pricing promises.

In 2011, Netflix lost 800,000 customers after an unexpected price hike and service change. Based on backlash, the company quickly reversed the change. Earlier this year, history repeated itself as new subscriber acquisition slowed and Netflix announced a new price increase, followed immediately by a stock price plummet and the loss of more than 126,000 subscribers. Customers usually don’t react well to paying more without a significant increase in features, usability or overall value — a lesson many freemium-driven companies are finding out the hard way. Although there are some success stories, such as Spotify’s impressive freemium-to-paid conversion rate, sticking with your pricing strategy in the long term can be as important as the strategy itself when it comes to customer retention.

3. Lead; don’t follow.

Most new companies founded today will enter a market with existing competition. As a leader focused on consumer value, I would challenge you to do your customer research and set your initial pricing based entirely on your unique offering and reason for being. Only then look at the rest of the market and determine how your choice will support or ensure success. When our company launched conference-calling services more than 20 years ago, there was significant competition in the space charging hundreds of dollars per month to deliver services to big corporate clients. Our founder looked at the market from the consumer point of view and found a way to deliver services for free while still generating revenue from carrying calls on our network. Other examples of pricing leadership include Slack, one of the pioneers of charging based on active users, and Creately’s albeit-short-lived “pay whatever you want” experiment.

No single decision can have a more far-reaching effect on company success than pricing. But pricing decisions should always be considered holistically as part of a long-term, value-based model. Pricing strategies that leverage who you are as a company and what you value create a foundation of mutual benefit that helps everyone from your customers and partners to your shareholders and employees.

In: Operations Management

Congress is currently debating another round of COVID19, or "Cares Act" Funding. At this point it...

Congress is currently debating another round of COVID19, or "Cares Act" Funding. At this point it is uncertain what will be in the funding package. What should AND should NOT be included in the next COVID-19 Funding Package? Respond to the below statements

1 Congress should include to all immigrants who have an ITIN and those who are undocumented workers. Congress should also provide them with cash assistance, unemployment and health insurance, since many immigrants with the ITIN also pay state and federal taxes.

2 What should be included in the Covid-19 Funding package is unemployment benefits, and a stimulus check, so it could provide us help through these tough times. What should not be included in the next Funding package infrastructure spending’s

In: Economics

Suppose that Jeff has a US quarter and a US nickel. Jeff believes that his US...

Suppose that Jeff has a US quarter and a US nickel. Jeff believes that his US quarter is more likely to land heads than his US nickel. Suppose Jeff flips his quarter 100 times and gets 51 heads, and Jeff independently flips the nickel 100 times and gets 49 heads.

(a) Construct a 99% confidence interval for the difference in the proportion of times Jeff’s quarter lands heads and the proportion of times Jeff’s nickel lands heads.

(b) If Jeff’s quarter were to truly land heads more often than his nickel, would Jeff hope that the confidence interval in (a) consists of only negative or only positive real numbers? Briefly explain your answer.

(c) What could Jeff do to get a narrower confidence interval than the confidence interval in (a)?

In: Statistics and Probability

The average annual tuition for a public university in 1998 was $20,598. In 2018, the average...

The average annual tuition for a public university in 1998 was $20,598. In 2018, the average annual tuition for a public university is $25,659. How much (as a percentage) has the tuition cost increased over the entire period? State your answer to two decimal places (e.g., 3.86)

In: Finance

How much would you need to gift to the university today to establish a scholarship fund...

How much would you need to gift to the university today to establish a scholarship fund that pays out $10000 in scholarships in one year and grows the scholarship payout by 1% per year? Assume that the university endowment earns 8% per year on its investments.

In: Finance

Assess and investigate the potential impact of the risk factors you’re your organisation faces The coronavirus...

Assess and investigate the potential impact of the risk factors you’re your organisation faces
The coronavirus epidemic has changed the way organisations are working.   

Your task is to assess the impact of the epidemic on your university.


a)   Explain how the analysis helps to identify risk for your university??

In: Accounting

A random sample of 64 students at a university showed an average age of 20 years...

A random sample of 64 students at a university showed an average age of 20 years and a sample standard deviation of 4 years. The 90% confidence interval for the true average age of all students in the university is

19.50 to 20.50

19.36 to 20.38

19.18 to 20.49

19.02 to 20.59
           

In: Statistics and Probability

Assume Manchester University wants to make sure, its graduates would find jobs with the highest possible...

Assume Manchester University wants to make sure, its graduates would find jobs with the highest possible wage during the job search process, because this will help the university to increase its reputation, and as a result, it will be able to increase the tuition rates. How can the university increase the average wage level of their students get after they graduate, assuming it can no longer increase their skill level? I think question is clear there is no neeed extra explanation please feel free to answer question and you can mention about both productivity and equilibrium.

In: Economics

please do not answer by hand written   2. Going ON-LINE in a Hurry: You are working...

please do not answer by hand written  

2. Going ON-LINE in a Hurry: You are working for the Crisis Management Team at a University XYZ. In light of the current events on campuses for the decisions that needed to be made in response to the pandemic, your team has been asked to develop a plan to convert the University of XYZ's classes on-line. Using your knowledge of systems engineering and co-ops, identify the Scope, Current situation, Justification for the Change, Proposed response, Operations

Scenarios, Impacts, and Analysis University XYZ needs to help develop a plan to convert classes on-line.

In: Operations Management

Case Study #1                          WALITAN CONSTRUCTION COMPANY Ashley Wesley is the assistant controller at the Walitin Const

Case Study #1                          WALITAN CONSTRUCTION COMPANY

Ashley Wesley is the assistant controller at the Walitin Construction Company. Walitin is headquartered in Miami, Florida, and has a general contractor’s license in 30 differ­ent states. It is a privately held company with about 5,000 stockholders, with the majority of the stock being owned by the Walitin family.

Roberta Walitin has been the CEO of Walitin Construction for the previous 12 years. Everyone considers her an excellent leader with excellent business skills. She has an undergraduate degree from the University of Illinois in engineering and an MBA from the same school with a concentration in accounting.

Roberta has always insisted on ethical business practices, so two years ago she worked
with Ashley to set up an ethics hotline, which Ashley personally manages on a daily
basis. Anyone either inside or outside of the company can submit tips anonymously by e-mail, telephone, or a special Web page she had set up. There is a prominent link to the hotline on the home page of the company’s Web site.

Since Ashley set up the hotline, she has received three tips, all via the Web. In every case, the tip was about a subcontractor overbilling the company for services ren­dered. In two of the cases, she was unable to confirm or disconfirm whether there was fraud, mainly because it is almost impossible to investigate the work of a sub­contractor on a job that has already been completed. But in the other case, she caught a roofer billing for fictitious work. She did not report the fraud to authorities, but Roberta did immediately replace the subcontractor with another roofing company. Ashley reports to Bob Benson, Walitin’s controller. He’s been with the company for many years and works very closely with Roberta. His main interest seems to be producing the financial statements and working with her to obtain new clients. Roberta and Bob spend large periods of their time going to lunches with clients, participating in civic meetings, and helping in small community-service construc­tion projects.

Because Bob is busy so much of the time with outside activities, Ashley pretty much runs everything in accounting on her own except for the software and hardware, which Bob manages in conjunction with the head of the IT department.

Bob is not interested in details, and anytime Ashley tries to explain something to him, he simply waves a hand and says, “Don’t worry me with operational issues. Just take care of it.” Ashley has learned to live with his hands-off approach.

Overall, Ashley runs everything smoothly. Her main problem is that Betty Grabber, the senior accountant reporting to her, wants Ashley’s job. To make things worse, Betty is a niece of Roberta Walitin’s husband.

Betty is a very wily person. Her goal is to have Ashley fired, and she’s been using her family connections to get the message to Roberta that Ashley is scheming to have Bob Benson, the controller, fired. Ashley also suspects that Betty has been spreading a rumor that she’s planning to go to work for a competitor if she is not successful in tak­ing over Bob’s job.

Ashley is unsure as to whether Bob is aware of the rumors. He seems to be avoiding her recently, and there seems to an edge in his usually friendly voice. Ashley is feeling depressed just thinking about it. She’s heard that Bob is having serious marital prob­lems. Perhaps those problems are affecting the way he acts.

This morning Ashley had a major surprise when she started reading her e-mail, which contained a new anonymous tip. Someone had submitted it last night via the Web, and it had automatically been forwarded to her via e-mail. The tip read as follows:

To: Walitin Tip System

From: http://[email protected]

Sent: Tuesday 8/1/2015

Ms. Wesley,                                                                

I’m sending this tip to help you. I understand what you are going through. You’re working for a liar and a thief. Bob Benson is hacking the accounting system to produce fraudulent financial statements. He’s doing it in such a way that you’ll get the blame. It’s going to be a big mess.

What should Ashley do? Should she try to investigate? Should she report the tip to Roberta?


Evaluate Walitin’s hotline and make recommendations for its improvement.

In: Accounting