INSTRUCTOR RESOURCES

Cipla
Publication Date: Jun 23, 2003/Revision Date: Apr 27, 2004
Author(s): Rohit Deshpande, Laura Winig
Product Number: 9-503-085
Length: 21p.
Description: The head of Cipla, a $325 million dollar Indian pharmaceutical company and seller of low-cost AIDS drugs to South Africa, must decide what to do about Cipla's future. With India poised to enforce international patents in only two years, much of Cipla's product line could become unsaleable (given that it is based on product patents protected in industrialized countries). Describes Cipla's role in forcing global pharmaceutical companies to lower their prices for AIDS drugs. Teaching Purpose: To discuss how an individual leader of a small company can have a dramatic impact on a major global problem, how the design of property rights affects the market's ability to meet important need, and international pricing.


Electronic Arts Introduces The Sims Online
Publication Date: Aug 23, 2002/Revision Date: Aug 26, 2003
Author(s): Youngme Moon
Product Number: 9-503-008
Length: 32p.
Teaching Notes: Electronic Arts Introduces The Sims Online, Teaching Note (5-504-044), 27p
Description: Electronic Arts (EA), the world's largest independent game publisher, is preparing to launch an online, subscription-based version of the most popular PC game in history: The Sims. The new game is called "The Sims Online" and it differs from the original game in two key respects: the gaming experience and the payment structure. In this context, EA managers must finalize several decisions that they believe are fundamental to the game's success, including target market selection and pricing/payment structure. Teaching Purpose: Designed to be taught at both a tactical and strategic level. At the tactical level, students explore the role of the target market in the process of diffusion as well as the implications of flat pricing vs. subscription-based pricing. At the strategic level, students examine an example of product management in an industry in which customer tastes are unpredictable and fickle.


Virgin Mobile USA: Pricing for the Very First Time
Publication Date: Sep 8, 2003/Revision Date: Mar 8, 2004
Author(s): Gail McGovern
Product Number: 9-504-028
Length: 19p
Description: Dan Schulman, the CEO of Virgin Mobile USA, must develop a pricing strategy for a new wireless phone service targeted toward consumers in their teens and twenties, many of whom are believed to have poor credit quality and uneven usage patterns. Contrary to conventional industry wisdom, Schulman is convinced that he can build a profitable business based on this under-represented target segment. The key is pricing. Schulman is currently debating three pricing options: 1) adopting a pricing structure that is roughly equivalent to the major carriers, 2) adopting a similar pricing structure, but with actual prices below the major carriers, or 3) coming up with a radically different pricing structure. With respect to the third option, Schulman is considering various alternatives, including a reliance on pre-paid (as opposed to post-paid) plans, and the total elimination of contracts. Teaching Purpose: Examines the interplay between pricing, target market selection, and a firm's overall value proposition. Explores the psychology of pricing at the level of price points and at the level of pricing structure. Demonstrates the nonlinear impact of price on both demand and profitability. Also demonstrates the extent to which pricing structure (as opposed to price point per se) can affect the consumption experience. Includes color exhibits.