Case Study Bmw Mini

1092 WordsJan 3, 20105 Pages
FreeMarkets Online Case Marketing Management, 45-720, Section A, Group 2 Arnab Basu Malcolm Johnson Douglas Meislahn Nicholas Reid Robert Schmidt 02/08/05 Marketing Management, 45-720, Section A FreeMarkets Online Case A. Basu, M. Johnson, D. Meislahn, N. Reid, R. Schmidt Executive Summary FreeMarkets Online is faced with developing a strategy that will increase revenues from $1.8 in 1997 to $6 million in 1998. To accomplish this tripling of their revenue streams, FreeMarkets Online should pursue vertical market dominance by emphasizing its core competencies and shunning any dilution of its product. To this end, the company should focus on the target markets that originally attracted its founders. Also, the unique…show more content…
Another suggested option was Marketing Management, 45-720, Section A FreeMarkets Online Case A. Basu, M. Johnson, D. Meislahn, N. Reid, R. Schmidt to change the way the current service was sold, such as eliminating commissions. This would push FreeMarkets Online to a fee-only pricing strategy. In order to make up for the lost revenue, FreeMarkets could raise their fees dramatically. However, given that commissions are typically paid to traditional manufacturer reps, the commissions are not only a familiar model, they are another way to emphasize FreeMarkets Online’s cost-effectiveness, with their commissions typically being half the industry standard. Also, they represent a more equitable approach to pricing since many contracts have annual renewal clauses that change the actual amount of supplies shipped. Finally, the company faced the choice to begin selling other industrial purchasing related services. One such service suggested was a web-based purchasing information service based off of FreeMarkets Online’s data from its past client engagements. However, this is not a corecompetency for FreeMarkets Online and could prove severely detrimental to their core service. Part of FreeMarkets Online’s value-adding proposition is that they bring together companies out of a huge network of buyers and suppliers that often have no previous knowledge of one another. While making information about things such as low-cost suppliers available will create some short-term
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