Tag Archives: pricing

Prosthetics for Pets

There is no doubt that the medical options for prosthetics offered to people are advancing by giant leaps. Recently, we wrote about a new amphibious prosthetic leg developed specifically for swimmers. Such innovations are not reserved only for the two-legged species; new orthotic and prosthetics are also available for pets who need new paws or legs.

While the animal prosthetic industry is very new, there have been new advances and an increase in demand for prosthetics for animals. According to industry experts, the growth has been exponential for the innovative services.

Perhaps some of this is due to the change in family/pet dynamics – pets are often viewed as important members of the family, and receive important health care. The prosthetics are custom-made and can cover knees, ankles, pays, wrists, elbows, and legs. Orthotic devices range in price from $750 – $950, while prosthetics average $1,350 – $1,750.

What would you pay for your pet’s care?

Group Activities and Discussion Questions:

  1. Pricing is usually a complex topic. Discuss the six steps for pricing (determining objectives, estimating demand, determining cost/profit relationships, select price level, set list price, and make adjustments).
  2. Next, show the Web site and videos for Ortho Pets: http://orthopets.com/
  3. Discuss the various pricing models in class: demand-oriented, cost-oriented, profit-oriented, and competition-oriented.
  4. For this product, divide students into groups and have each group work on any/all of the six steps.
  5. When setting the price level, assign each team a different model to use (demand-oriented, cost- oriented, etc.).
  6. Debrief the exercise. Compare the various pricing models and discuss advantages/disadvantages of each.

Source: Tribune News Service

 

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The Randomness of Airfare Pricing

One of the most frustrating parts of traveling is booking an airline seat. The price shown to buyers in the morning is undoubtedly increased by the evening. And, the price you finally paid is probably not the same as the price paid by the person sitting next to you! Airfare prices seem to change by the minute, and it all feels random to frustrated buyers.

Maximizing the sales of seats, called ‘revenue management’ by the airline industry, is incredibly complicated. Airlines use complex algorithms and computer systems that are constantly calculating the perfect price. The computer programs must predict consumer behavior in order to determine what the market is willing to pay for the seat.

An empty airline seat is a perishable commodity; once the plane leaves the runway, the empty seat can never be sold. How would you price the seat?

Group Activities and Discussion Questions:

  1. Pricing is a complex topic. Discuss the six steps for pricing (determining objectives, estimating demand, determining cost/profit relationships, select price level, set list price, and make adjustments).
  2. Discuss the various pricing models in class: demand-oriented, cost-oriented, profit-oriented, and competition-oriented.
  3. Discuss how yield management (or revenue management) pricing works.
  4. Show the airfare pricing video: https://youtu.be/-oJlJ5oo5AM
  5. For a selected product, divide students into groups and have each group work on any/all of the six steps.
  6. When setting the price level, assign each team a different model to use (demand-oriented, cost- oriented, etc.).
  7. Debrief the exercise. Compare the various pricing models and discuss advantages/disadvantages of each.

Source:  CNN

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Hum Rider

Hum Rider is a custom-build car that can master any traffic jam with a flick of a switch. The car widens and elevates so that you can drive right over the cars in front of you!  Really, it works.

But, unfortunately, the Hum Rider is not a real car that can be purchased. (Too bad, because if it existed, it would sell)! The Hum Rider is however an ingenious advertisement (and a specially-built vehicle) to promote a new service, Hum by Verizon.

Hum is a device that makes cars smarter and more connected with a suite of features. The device notifications include mechanic hotline, maintenance reminders, boundary and speed alerts, and for an additional fee, includes Wi-Fi hot spot.

Hum is priced at a subscription fee of $10 per month, plus $20 activation fee, plus $29.99 equipment fee. To use: download the app, clip Hum speaker to car visor, plug the Hum reader into a car’s OBD-II port, and it’s ready to go.

The video was a viral hit garnering 35 million views on Facebook in 48 hours. But sadly, it just can’t jump over the cars in front of you on the highway.

Group Activities and Discussion Questions:

  1. Pricing is usually a complex topic. Discuss the six steps for pricing (determining objectives, estimating demand, determining cost/profit relationships, select price level, set list price, and make adjustments).
  2. Discuss the various pricing models in class: demand-oriented, cost-oriented, profit-oriented, and competition-oriented.
  3. Show the Hum Rider video: https://youtu.be/faU7-6u58zM
  4. View the Web site Hum by Verizon: https://www.hum.com/
  5. For Hum, divide students into groups and have each group work on any/all of the six steps.
  6. When setting the price level, assign each team a different model to use (demand-oriented, cost- oriented, etc.).

Source:  Ad Week  

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