Multi-generation pricing and timing decisions in new product development

Abstract

When planning for the introduction of a stream of new products into the marketplace, managers must consider both the timing and dynamic pricing decisions to determine an appropriate entry strategy into the marketplace. Literature in new product development (NPD) typically addresses optimal timing and pricing decisions independently. We develop an analytical model of coordinated product timing and pricing decisions when there are two generations of a new product under consideration. Factors driving the timing and pricing decisions include the unit sales and cost relationships for each generation as well as NPD costs for introducing the next generation of products. We derive analytic results that characterise the optimal timing and pricing strategies for a single product rollover scenario. We analyse several numerical examples to illustrate the interplay between optimal pricing and time-to-market strategies under more general settings.

Cost–benefit model for multi-generational high-technology products to compare sequential innovation strategy with quality strategy

“…To compare the quality strategy and sequential innovation strategy, we set two firms in the Korean smartphone market, A and B. Because the sales performance of a product's former generations indirectly affects that of later generations, several generations must be considered to thoroughly observe the complex dynamics among generations [4]. Moreover, as two firms have different generation lengths for their flagship models, the total net present value along an infinite timeline must be considered.…”

“…Therefore, firms that regularly introduce new high-tech products usually face challenges in optimizing allocation of their efforts between innovativeness and quality [3]. Such decision-making concerning time management when developing and introducing new products in the market are important managerial issues for high-tech firms [4].…”

Manufacturer’s Business Strategy: Interaction of Sharing Economy and Product Rollover

“…when c < c 2 and r < c. e manufacturer will participate in product sharing and choose the S-DR strategy, where 4 Complexity e manufacturer can create a sustainable competitive advantage and achieve a large market share by taking into account a dual rollover strategy [34]. Idle products from owners in the sharing market and new products from the manufacturer will cannibalise previous-generation product's demand [6].…”

Refleksi Nilai Di Balik Penetapan Harga Umoonu

“…Harga memainkan peranan penting terhadap terbangunnya ataupun terhambatnya suatu kinerja bisnis. Meskipun demikian, terdapat tiga dimensi penting yang dapat dijadikan dasar terhadap kemampuan penetapan harga, yaitu perspektif pelanggan, pers pektif pesaing, dan perspektif perusahaan dengan tetap berpegang pada daftar harga dan meminimalkan pemberian diskon (Choi et al, 2020;Hidayat & Triyuwono, 2019;Liozu & Hinterhuber, 2013;Seref et al, 2016). Namun, realitanya harga dan kualitas bia sanya berbanding lurus.…”