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Virgin Mobile Usa

In: Business and Management

Submitted By enzo0417
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Given Virgin Mobile’s target market (14 to 24-yeard-olds) How should it structure its pricing? The case lays out three pricing options. Which option would you choose and why? In designing your pricing plan, be as specific as possible with respect to the various elements under considerations (e.g. contracts, the size of the subsidies, hidden fees, average per-minute charges, etc.)
There are two different pricing structures for Virgin Mobile. The first pricing structure is for their target market, 14 to 24-year-olds, and any new product entering a saturated market, the pricing should be low in the market. The second pricing structure is that Virgin Mobile is pricing their product in the middle or average of the industry standard. For Virgin Mobile, I believed that the first structure is easier to attract their target market, 14-24 year olds young demographic. The reason is that this age demographic group does not have too much money to use or to pay for their mobile phone bill. This pricing structure would appeal to the target market and help Virgin Mobile to create brand image which is young, interesting, and fun. While this pricing structure strategy would help gain consumers that value pricing when choosing their products, it could also work against Virgin Mobile. This pricing can create the image that the phones do not have as high of a quality if they are priced below the industry low. This structure would achieve the goal of attaining a sizable amount of the market share, but it would not be as profitable as the second pricing structure strategy.
According to this case, which lays out three different pricing options. I believed that the option 3, a whole new plan, would be the most effective, profitable, and right choice for Virgin Mobile to target young segment market.
The main reason is this pricing strategy is easy for young consumers to understand and...

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