Case study

Product Pricing
Oligopoly
The Indian Audio Market
Major Players
Pricing Strategies
Pricing Strategies
 Product Bundling
• Is a marketing strategy that involves offering several
products for sale as one combined product
• There are two types of Bundling Strategies
a) Pure Bundling
b) Mixed Bundling
• Product bundling is most suitable for high volume
and high margin (i.e., low marginal cost) products
• Bundling is particularly effective with close to zero
marginal cost and enables a bundler with an inferior
collection of products to drive even superior quality
goods out of the market place.
• Pure bundling occurs when a consumer can only
purchase the entire bundle or nothing
• Pure bundling can be further divided into two cases:
a) Joint bundling – In this the two products are
offered together for one bundled price
b) Leader bundling – In this a leader product is
offered for discount if purchased with a non-leader
product
• Mixed bundling occurs when consumers are offered
a choice between purchasing the entire bundle or
one of the separate parts of the bundle.
 Product Maturity and Bundling
• As mentioned in the previous slide, Indian
audio market has five distinct segments
1)Traditional Radios, 2) Mono Recorders,
3)Stereo Recorders, 4) Midi Systems and 5) Hi-
Fis.
• Entry of international players are ushering
new concepts like CD sound, Digital tuners, full
logic tape deck etc which are driving out
products at the lower levels of the pyramid.
 Videocon and Other Players
• Major Player Only in Personal Stereos and Two-in-
ones.
• Strategy to launch the Sansui brand of products to
transform its image and obtain share in the high
end market.
• Can use Mix Bundling/ Mix Leader Bundling to
promote its brands.
• Other National and International players can use
bundling for Market Penetration and Stock Clearing