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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.

MAKING A
DIFFERENCE IN
THE EYES OF THE
CUSTOMER IN
TERMS OF:
VALUE OF MONEY QUALITY INNOVATION
FUN SENSE OF
“COOLNESS”

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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

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

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.

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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