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Virgin Mobile USA ppt NEIRST pptx

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Virgin Mobile USA ppt NEIRST pptx

  1. 1. • • • • • • • • •
  2. 2. Objective-to develop a pricing strategy for a wireless service Target segments-teens and twenties Business model-mvno- no fixed cost or investment in physical infrastructure Virgin’s brand personality- Innovative , fun ,pro-active and challenging Identify and enters areas , where competitors are complacent or customers taken for a ride by existing player.
  3. 3. MAKING A DIFFERENCE IN THE EYES OF THE CUSTOMER IN TERMS OF: VALUE OF MONEY QUALITY INNOVATION FUN SENSE OF “COOLNESS”
  4. 4. • • •
  5. 5. • • • •
  6. 6. MVNO- was successful in UK not is singapore Ad budget – approx $ 60 million Lower commission - $ 30 per phone as against industry average of $ 10 Different channels strategy where youth shop
  7. 7. Option 1: clone the industry prices Pros Ease in implementation Service and application differentiation Competitive off peak hours rates and lesser hidden fees Cons No pricing advantages w.r.t competition Will not work with low income segment Poor credit quality o f the targeted segment , will reduce the target market further Difficult to penetrate the market without lower prices
  8. 8. Option 2: price below the competition Pros • Pricing advantage w.r.t competitors • Fits with the requirements of the target market i.e lower price • Cheaper and hence assecible to low income segment • Will enable better penetration Cons • Low margin and would need deep pocket • May cause a price war.
  9. 9. Pros Do away with the contracts so as to get low credit customers Prepaid service to help customer decide their own talk plan Specifically customized for the target market Subsidized handsets to make the deal attractive Eliminate all hidden cost Cons High chur rate of 6% Concerns over margins Concerns over the recovery of cost of handset After evaluating the pros and cons of the three plans , I’ve decide to try option 3 with optimal pricing
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  11. 11. • • • • • • • • •

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