Analysis of Pricing and Model Strategies at Cambridge Software

1407 Words Jan 8th, 2018 6 Pages
A second objective of this analysis is to define how many potentially different versions of the Model that CSC should offer, and at which prices. This analysis is heavily based on the concepts of pricing elasticity and the various approaches for measuring the value of software in both enterprises and educational institutions (Cusumano, 2007).
Analysis of Cambridge Software Modeler Optimal Version and Price
Given the highly unique and differentiated aspect of the Modeler application, its price needs to be based more on the value delivered, not just on the costs in time and labor to produce. The arguments and assumptions made by the members of the Cambridge team in the case for choosing a penetration pricing strategy are erroneous. As research of value-based pricing strategies indicates, the greater the value delivered by a given application or element of intellectual property, the higher the level of value and corresponding price that can be attained (Bala, Carr, 2009). This first foundational element of pricing needs to guide Cambridge's decision of which application to offer and at what price.
Second, enterprise software in highly specific niches or areas of the market trend to be more inelastic to…

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