9483
AiS

Session 2b

Joshua
Foster



Agenda

  1. Quick Case: Joy4Home Brands: Pricing Matters.
  2. Identifying Optimal Pricing Strategies

Degrees of price discrimination.

  1. Perfect price discrimination (last session).
  2. Menu-based priced discrimination.
  3. Taste-based priced discrimination (last session).

Menu-based priced discrimination.

Charging different prices based on the quantity or quality of a product.


Key feature: Customers self-select into different pricing categories based on their (unobservable) preferences.

Example: Airlines

  1. Consumer Type A: business traveler making short trips. WTP=800
  2. Consumer Type B: vacation traveler making long trips. WTP=400

Ticket option 1: "Unrestricted tickets" @ $800 each.

Ticket option 2: "Vacation special tickets" @ $400 each, requiring a span of two weeks between flights.

Joy4Home Brands: Pricing Matters revolves around a company preparing to launch novel houseware and industry-grade products.

  1. In a direct-to-consumer (DTC) channel, they plan to introduce two product lines: kitchenware products and storage containers.
  2. For industrial kitchens, they are exploring a cheaper version of their kitchenwares that customers would buy muliples of.
  3. The case discusses the challenges the company faces in determining the pricing for each market.

Objective: Identify optimal pricing strategies for these products given the information in the case.

Group 1 Bani Sehgal Evelyn Vanderhoof Suyash Singh Annie Zhang Mike Hockin Mackenzie Fulton Kaartikeya Pandey
Group 2 Runfeng Li Alexis Gantous Milos Masnikosa Elvin Yu Sachin Mohanty Melanie Starke Zhaokun Du
Group 3 Tunmise Ajiboye Lin Ma Gagandip Grewal Smarth Narula Kai Hu Adamo Sansalone
Group 4 Brianna Bossio Christina Gucciardi Syed Murtaza Nadeem Yashodhan Sule Nikola Lapenna Rawaiz Sheikh
Group 5 Matthew Grilli Shiva Sankar Akshat Singh Eric Parr Josiah Dueck Natasha Shew
Group 6 Andrew Shepherd Ross Ferguson Michael Saunders Mehak Sood Calvin Jiang Mustafa Khan
Group 7 Jennifer Hsin Ismyal Khan Gabrielle Stadler Kaanshika Mittal Noah Suissa Akshay Rewale
Group 8 Aakriti Gupta Feng Xu Shashank Rusia Karanvir Singh Mayank Ahuja Siddhanth Khanvilkar
Group 9 Atanu Sahoo Prithvi Nag Imaiya Ravichandran Max Welyhorsky Abhimanyu Sheoran Daniel Zhu

Small Group Task

In your assigned groups, take the next 40 minutes to reflect on the In-class Assignment Questions posted to Learn for this quick case.

Be prepared to discuss your responses to these questions when time is up.