Barco Projection Systems Case

Good Essays
1. How large is the projector market in unit terms?

In 1988, the projector market in unit terms is around 31,000 (31,054)


In 1988, ElectroHome has sold 1,585 units – 1,157 (73%) data and 428 (27%) graphics ( Page 10 - 1st line )

In 1988, ElectroHome has 11% of the data market and 44% of graphics projector market (Page 8 - Table E)
Total units in market of data projectors = 1,157/.11 = 10,518
Total units in market of graphics projectors = 428/.44 = 972

Data & graphics projectors account for 37% of total units. (Page 5 - Table A)
Total projector units in 1988 = (10,518 + 972 ) / .37 = 31,054

Below is a summary of the units in 1988 and projections in 1989 1988 1989 ( projected )
Video 19,564 19,579
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4. Construct a price‐scan rate map (using an Excel XY plot, for example). Use the following numbers (Culled from the case):

Looking at the price-scan rate map, the BV600, the S1031 and the BD600 all line up on the same value equivalent line. However, the BG400 lies north of that VEL. This implies that the BG400 is sold at a premium compared to the other projectors.

5. Put yourself in Sony’s shoes. You look at the answers to the 4 above questions.
Given your capabilities and resources, what should your strategy be? Specifically, what would you price the 1270 at?

Given Sony’s superior 8” tube technology and its worldwide network of dealers, especially its 500 dealers in the U.S. market versus BPS’s 100, Sony’s primary goal should be capturing market share in the graphics projector segment.

One way to estimate the price for S1270 is by using the value map from the previous scenario. After adding the S1027 data projector on the value map (as shown below), we can see that Sony has to price the projector in the range of $17,000 - $18,000(Option 1)to be on the value equivalence line. Since Sony has a strong distributor presence in the US market, it can introduce S1027 at a price lesser than $17,000 to be at a value advantaged position depending on product margins. From Sony’s point of view, if it were to price 1270 at $15,000 (option 2) this might lower the value equivalence line and put BPS’s products at a value
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