Music counter-intuitive pricing.docVIP

 PAGE \* MERGEFORMAT 9 Music counter-intuitive pricing In October 2001, when Apple Computer Inc. (Apple founder Steve #8226; Jobs (Steve Jobs introduced the iPod way to start a digital music revolution, he faces a dilemma: in a manufacturing, such as CD-ROM production and distribution and transportation costs are no longer a problem in emerging markets, a song in the end worth it? Last 10 years, digital music consumers, many things have changed, including music for mobile devices is growing, and Apple’s iTunes store competitors continue to increase, but one thing is fairly stable , that is the price of most single long-term maintenance in the level of 99 cents (some popular songs will be priced to $ 1.29 and less popular tracks the price was 69 cents per song. Wharton marketing professor Lagulamu #8226; Iyengar (Raghuram Iyengar conducted studies have shown that those who believe that iTunes is not fair pricing system developed by the major record companies can make their own catalog of music in higher profits , but they are not the means by raising prices, but by reducing the price to achieve. Recently, the focus on price and consumer behavior research Iyengar on 600 digital music consumers surveyed, the survey aimed at the music industry to develop optimal pricing system, from recording to digital download and CD era struggling with the changing times in the process, the music industry revenues declining. Iyengar’s study is both concerned “by single payment options” (pay-per-song plans, for example, payment options offered by iTunes, but also eMusic and others concerned about the use of “subscription model” (subscription models, in this model, the consumer a certain amount per month to download songs to pay a fixed fee. Iyengar surprised to learn that, among consumers in the digital music, not only by single mode of payment is more popular, and when lower prices when they purchase music products will significantly increase the number of - growing in