Netflix Mini Stage
The pricing strategy for Netflix Mini Stage will be penetration. Since the product is new in the market, the company will want to tap into the market and hold the customers through lower introductory prices. Since the pricing principle indicates the need for the company to assess market sensitivity and offer a pricing scheme that resonates with consumers’ perceptions, penetration pricing will be consistent with the company’s brand equity and brand position.
Netflix will keep the cost of producing the Netflix Mini Stage product low. The pricing strategy will help moderate the relationship between product innovativeness and rational consumer decision making (Feurer, Monika and Sabine 69). Therefore, figure 1 in the appendix shows that the competitive price for the company will reflect the cost of products and all variable costs involved. Given that the Netflix Mini Stage is a miniature scene of the favorite TV series, the company could sell this product through rental or subscription. Netflix will restrict the price for the Netflix Mini Stage to $15.59 for purchase, $1.2 for one-off streaming, and $3.79 for the monthly subscription. Therefore, most of the customers are aware of the rigid pricing structure that the company uses.
Although $15.59 seems cheap, it is effective in helping Netflix penetrate the market. The price is also suitable to allow the company to meet the cost of producing Netflix Mini Stage. The strategies reflects the growing approach to maintain the retail brand familiarity (Wu et al. 247). Netflix will align the price of the Netflix Mini Stage to the existing price structure in the company. Since the company will provide diverse pricing for the different market needs, it will be adequate to integrate Netflix Mini Stage into the overall pricing policy for the company. Therefore, the company will retain its plan approach to allow high Definition streaming, Ultra High Definition, and Standard definition graphics. After the product starts performing in the market, Netflix will structure the price for Netflix Mini Stage according to different plans, which seek to reflect the standard pricing structure. The estimated costs of the new products will include:
- Standard Definition of Netflix Mini Stage will retail at $.2 for a month.
- High Definition subscription will retail at $4.5
- Ultra High Definition plan will retail at $7.
The different plans allow customers to make decisions based on their needs at that time. The company will also ensure that it bills customers Netflix Mini Stage, depending on whether a TV-series miniaturized scene is a movie or a documentary. The three will differ because a series will need customers to order more Netflix Mini Stage. For this reason, the pricing for the TV series and documentary will be as follows.
- The price will be $12.59 for a one-off purchase, which allows the client to download the product.
- There will be a $0.5 for one-off streaming of the product in a miniaturized TV series.
- Finally, the customer who will prefer a monthly subscription will have Netflix charging them for a $2.99 monthly subscription for all the Netflix Mini Stage they access throughout that month.
Like the existing pricing structure, the Netflix Mini Stage plan will see customers enjoy the product they have paid according to their subscribed plan. Customers on the basic plan can only stream the services on one device. The standard and the premium subscription plans will offer the customer the benefits of sharing the account and streaming up to four different devices. Therefore, the implication is that customers on the higher plan can watch the movies, series, or videos simultaneously on different devices.
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