Product Differentiation and Market Segmentation of Information Goods

Product Differentiation and Market Segmentation of Information Goods
Author: Barrie R. Nault
Publisher:
Total Pages: 44
Release: 2006
Genre:
ISBN:

Large sunk costs of development, negligible costs of reproduction and distribution and substantial economies of scale make information goods distinct from physical goods. Consequently,how to take advantage of the specific characteristics of information goods is an important managerial problem. Price discrimination and product differentiation are common ways this issue has been addressed. In previous literature, vertical differentiation and related pricing strategies have been researched in contexts such as nonlinear utility functions,network externalities, competition and anti-piracy. Little attention has been paid to the relationship between market segmentation and product differentiation. In this paper, we emphasize the interaction of market segmentation and product differentiation as we believe that any product differentiation must be based on existing market segmentation. In our model, we treat vertical differentiation as a special case of horizontal differentiation, and we model the interaction between different market segments showing the differences in product differentiation strategies when moving from horizontal to vertical differentiation. We find that it is always sub-optimal to differentiate information goods if the market is not fully differentiated or if characteristics of the information goods are not specifically designed for certain market segments. We divide characteristics of information goods into four categories according to the ease of differentiation and design guidelines for firms to differentiate their goods based on these characteristics. We further provide guidance on whether to merge one or several versions when costs for versioning information goods are significant.

Introduction to Business

Introduction to Business
Author: Lawrence J. Gitman
Publisher:
Total Pages: 1455
Release: 2024-09-16
Genre: Business & Economics
ISBN:

Introduction to Business covers the scope and sequence of most introductory business courses. The book provides detailed explanations in the context of core themes such as customer satisfaction, ethics, entrepreneurship, global business, and managing change. Introduction to Business includes hundreds of current business examples from a range of industries and geographic locations, which feature a variety of individuals. The outcome is a balanced approach to the theory and application of business concepts, with attention to the knowledge and skills necessary for student success in this course and beyond. This is an adaptation of Introduction to Business by OpenStax. You can access the textbook as pdf for free at openstax.org. Minor editorial changes were made to ensure a better ebook reading experience. Textbook content produced by OpenStax is licensed under a Creative Commons Attribution 4.0 International License.

Market Segmentation Analysis

Market Segmentation Analysis
Author: Sara Dolnicar
Publisher: Springer
Total Pages: 332
Release: 2018-07-20
Genre: Business & Economics
ISBN: 9811088187

This book is published open access under a CC BY 4.0 license. This open access book offers something for everyone working with market segmentation: practical guidance for users of market segmentation solutions; organisational guidance on implementation issues; guidance for market researchers in charge of collecting suitable data; and guidance for data analysts with respect to the technical and statistical aspects of market segmentation analysis. Even market segmentation experts will find something new, including an approach to exploring data structure and choosing a suitable number of market segments, and a vast array of useful visualisation techniques that make interpretation of market segments and selection of target segments easier. The book talks the reader through every single step, every single potential pitfall, and every single decision that needs to be made to ensure market segmentation analysis is conducted as well as possible. All calculations are accompanied not only with a detailed explanation, but also with R code that allows readers to replicate any aspect of what is being covered in the book using R, the open-source environment for statistical computing and graphics.

Market Segmentation for Information Goods with Network Externalities

Market Segmentation for Information Goods with Network Externalities
Author: Bing Jing
Publisher:
Total Pages: 28
Release: 2008
Genre:
ISBN:

Positive externalities characterize the consumption of a majority of information goods such as software, various Internet services, and online communities. In a simple model of vertical differentiation, we show that network externality is a critical factor for the versioning of such information goods. In particular, a multi-product monopolist offers two versions of distinct qualities. The underlying rationale is that offering the low-end version expands the network size and thus enhances the (network) value of the high-end version, allowing the firm to charge a higher price for the high-end version. In addition, we show that the low-quality version may be offered for free under very general conditions. Competition between firms producing compatible products reduces their incentive to version their products due to the spillover effects in a shared product network.

The Economic Theory of Product Differentiation

The Economic Theory of Product Differentiation
Author: John Beath
Publisher: Cambridge University Press
Total Pages: 220
Release: 1991-02-22
Genre: Business & Economics
ISBN: 9780521335522

There are few industries in modern market economies that do not manufacture differentiated products. This book provides a systematic explanation and analysis of the widespread prevalence of this important category of products. The authors concentrate on models in which product selection is endogenous. In the first four chapters they consider models that try to predict the level of product differentiation that would emerge in situations of market equilibrium. These market equilibria with differentiated products are characterised and then compared with social welfare optima. Particular attention is paid to the distinction between horizontal and vertical differentiation as well as to the related issues of product quality and durability. This book brings together the most important theoretical contributions to these topics in a succinct and coherent manner. One of its major strengths is the way in which it carefully sets out the basic intuition behind the formal results. It will be useful to advanced undergraduate and graduate students taking courses in industrial economics and microeconomic theory.

Marketing Information Products and Services

Marketing Information Products and Services
Author: International Development Research Centre (Canada)
Publisher: IDRC
Total Pages: 483
Release: 1999
Genre: Business & Economics
ISBN: 0889368171

Contributed articles presented at a workshop held in 1994.

Travel Marketing, Tourism Economics and the Airline Product

Travel Marketing, Tourism Economics and the Airline Product
Author: Mark Anthony Camilleri
Publisher: Springer
Total Pages: 223
Release: 2017-10-03
Genre: Business & Economics
ISBN: 3319498495

This book provides a comprehensive introduction to travel marketing, tourism economics and the airline product. At the same time, it provides an overview on the political, socio-economic, environmental and technological impacts of tourism and its related sectors.This publication covers both theory and practice in an engaging style, that will spark the readers’ curiosity. Yet, it presents tourism and airline issues in a concise, yet accessible manner. This will allow prospective tourism practitioners to critically analyze future situations, and to make appropriate decisions in their workplace environments. Moreover, the book prepares undergraduate students and aspiring managers alike with a thorough exposure to the latest industry developments. “Dr. Camilleri provides tourism students and practitioners with a clear and comprehensive picture of the main institutions, operations and activities of the travel industry.” Philip Kotler, S.C. Johnson & Son Distinguished Professor of International Marketing, Kellogg School of Management, Northwestern University, Evanston/Chicago, IL, USA “This book is the first of its kind to provide an insightful and well-structured application of travel and tourism marketing and economics to the airline industry. Student readers will find this systematic approach invaluable when placing aviation within the wider tourism context, drawing upon the disciplines of economics and marketing.” Brian King, Professor of Tourism and Associate Dean, School of Hotel and Tourism Management, The Hong Kong Polytechnic University, Hong Kong “The remarkable growth in international tourism over the last century has been directly influenced by technological, and operational innovations in the airline sector which continue to define the nature, scale and direction of tourist flows and consequential tourism development. Key factors in this relationship between tourism and the airline sector are marketing and economics, both of which are fundamental to the success of tourism in general and airlines in particular, not least given the increasing significance of low-cost airline operations. Hence, uniquely drawing together these three themes, this book provides a valuable introduction to the marketing and economics of tourism with a specific focus on airline operations, and should be considered essential reading for future managers in the tourism sector.” Richard Sharpley, Professor of Tourism, School of Management, University of Central Lancashire, UK “The book's unique positioning in terms of the importance of and the relationships between tourism marketing, tourism economics and airline product will create a distinct niche for the book in the travel literature.” C. Michael Hall, Professor of Tourism, Department of Management, Marketing and Entrepreneurship, University of Canterbury, Christchurch, New Zealand “A very unique textbook that offers integrated lessons on marketing, economics, and airline services. College students of travel and tourism in many parts of the world will benefit from the author's thoughtful writing style of simplicity and clarity.” Liping A. Cai, Professor and Director, Purdue Tourism & Hospitality Research Center, Purdue University, West Lafayette, IN, USA “An interesting volume that provides a good coverage of airline transportation matters not always well considered in tourism books. Traditional strategic and operational issues, as well as the most recent developments and emerging trends are dealt with in a concise yet clear and rational way. Summaries, questions and topics for discussion in each chapter make it a useful basis for both taught courses or self-education.” Rodolfo Baggio, Professor of Tourism and Social Dynamics, Bocconi University, Milan, Italy “This is a very useful introductory book that summarises a wealth of knowledge in an accessible format. It explains the relation between marketing and economics, and applies it to the business of airline management as well as the tourism industry overall.” Xavier Font, Professor of Sustainability Marketing, School of Hospitality and Tourism Management, University of Surrey, UK and Visiting Professor, Hospitality Academy, NHTV Breda, Netherlands “This book addresses the key principles of tourism marketing, economics and the airline industry. It covers a wide range of theory at the same time as offering real-life case studies, and offers readers a comprehensive understanding of how these important industries work, and the underpinning challenges that will shape their future. It is suitable for undergraduate students as well as travel professionals, and I would highly recommend it.” Clare Weeden, Principal Lecturer in Tourism and Marketing at the School of Sport and Service Management, University of Brighton, UK “In the current environment a grasp of the basics of marketing to diverse consumers is very important. Customers are possessed of sophisticated knowledge driven by innovations in business as well from highly developed technological advances. This text will inform and update students and those planning a career in travel and tourism. Mark Camilleri has produced an accessible book, which identifies ways to accumulate and use new knowledge to be at the vanguard of marketing, which is both essential and timely.” Peter Wiltshier, Senior Lecturer & Programme Leader for Travel & Tourism, College of Business, Law and Social Sciences, University of Derby, UK “This contemporary text provides an authoritative read on the dynamics, interactions and complexities of the modern travel and tourism industries with a necessary, and much welcomed, mixture of theory and practice suitable for undergraduate, graduate and professional markets.” Alan Fyall, Orange County Endowed Professor of Tourism Marketing, University of Central Florida, FL, USA

A Theory of Market Strategy

A Theory of Market Strategy
Author: Richard J. Geruson
Publisher: Oxford University Press, USA
Total Pages: 278
Release: 1992
Genre: Business & Economics
ISBN:

Intense competitive and turbulent economic conditions have forced American businesses to re-examine every aspect of their strategies, from organization to how they publicly present what they sell. A Theory of Market Strategy uses economic theory to derive concepts of market strategy involving the exploitation of the differences in potential consumers and in products. That is, a firm can create a market strategy for a new product that takes into account the fact that different customers will be willing to pay different prices based on their expertise and perception of the product's value. In addition, this strategy considers that consumers will also want different models of the product. In the first half of this work, Geruson develops these concepts, showing that the key to successful market strategy is the exploitation of "two dimensional market heterogeneity", a new idea that integrates and enhances the concepts of product differentiation, price discrimination, market segmentation, information signalling, and customer purchase risk reduction. The second half follows with applications to these concepts in regard to the mainframe computer industry. In-depth examples from IBM and niche computer companies Cray, Tandem, and Control Data show how to practically implement the ideas and provide many lessons on the hidden pitfalls and secrets to success in market strategy. The book derives from Geruson's dissertation at Oxford University and has been augmented by his experience at International Business Machines, Incorporated and Toshiba International, making it accessible to sophisticated practitioners in market strategy and strategic planning.

Marketing Management

Marketing Management
Author: Michael R. Czinkota
Publisher: Springer Nature
Total Pages: 901
Release: 2021-08-24
Genre: Business & Economics
ISBN: 3030669165

This textbook provides students with comprehensive insights on the classical and contemporary marketing theories and their practical implications. A fourth, revised edition of Marketing Management, the text features new classical and contemporary cases, new interdisciplinary and cross-functional implications of business management theories, contemporary marketing management principles and. futuristic application of marketing management theories and concepts. The core and complex issues are presented in a simplified manner providing students with a stimulating learning experience that enables critical thinking, understanding and future application. Each chapter features a chapter summary, key terms, review and discussion questions and a practice quiz. Throughout the text there are also specific teaching features to provide students and instructors with an enhanced pedagogical experience. These features include: The Manager’s Corner: These sections provide real-world examples that instructors may highlight to exemplify theory or as mini-cases for discussion. Marketing in Action: These sections ask students to apply concepts and theories to actual business situations. Web Exercises: These mini sections provide students with real world issues and suggest websites for more information. In addition, the authors provide ancillary lecture notes and Solution/Instructors manual online to aid instructors in their teaching activities.