Microsoft Corporation is a company founded by Bill Gates and Paul Allen in 1975. Since the time of its inception it has never been behind technology. Some of the products introduced by Microsoft used in our daily lives include Internet Explorer, Microsoft office 2007 etc. These products are of significant importance to the companies because they make the work less tiring and quick.
This new product introduced by Microsoft called Enterprise Management Solution. This software is an integrated product of different soft wares introduced by Microsoft which includes: Microsoft Project Professional coupled with Microsoft Project Server. There is a large demand for this type of software. Companies small or large work on many projects at a time. This software will stream line their work (Microsoft).
Microsoft Corporation always involves in a unified global pricing strategy. For different countries they have always priced their products differently depending upon the economy of the country. Pricing for this product is how ever an important issue. Enterprise Management Solution is a unique product that is offered by Microsoft. The market is not competitive enough because the rival companies have yet not come up with such a solution. Also considering the fact that Microsoft has the largest market share of 90% approximately there is not enough threat of loosing market share with a high price. Another important advantage that Microsoft has is of its brand name which is trusted by everyone (Evers, 2004).
Enterprise Management software is a unique combination of integrated soft wares made by Microsoft. Given its Microsoft Windows compatibility, high interactivity opportunities with other Microsoft applications, recognizable GUI, and ease of use this product offers added incentives to any company that already relies on Microsoft technology to some degree (Microsoft).
Today the companies exist in a multi project environment so they need a collaboration to manage all the projects at the same time. This software provides the functionality to manage the interdependencies of the various projects and the tasks involved.
The new project management software provides a competitive edge over the other soft wares by the competitors like IBM, Oracle and Google. By introducing this software Microsoft Corporation has increased the technology gap between the products offered by the competitors. Small and large organizations will be attracted towards this software immediately as the experience of Microsoft products is very good.
Considering all these facts Skim Pricing is not a wise choice because the company already has a 90% market share. Penetrating pricing is done to attract the customers from the competitors in this case it is not relevant. As there is not much competition for this software thus, below the market pricing can result in an under estimation and significant loss for the company.
The pricing of the product can be done at Above-the-market or At-the-market level, the reason being the strong brand name Microsoft has, the unique features the product is providing and the strong market demand as the trend towards systematic approach towards every project is increasing. Microsoft Corporation does not need to attract any customers from the competitors. However to make its place in the market for relevant customers Microsoft is working with the Governments of different countries to price the software correctly (Kotler, & Armstrong, 2005).
The need of promotion of any product offered by Microsoft is not of much importance. The reason being the good experience companies have since the past years. The brand name of Microsoft is authentic enough for the customers to trust the product. Microsoft also offers to download a free trial version from its website.
The major competitors of Microsoft are IBM and Oracle but in comparison Microsoft has the largest market share. IBM and Oracle already have project management soft wares but not as extensive as Enterprise Management Software. The features offered by Microsoft are more, in comparison to any of the existing soft wares offered by the competitor companies. This provides Microsoft Corporation with a competitive edge over its competitors. This means that Microsoft can price its product at higher price as compared to the prices offered by the competitors. The reason for this is that the extent of technology that Microsoft is offering to the small and large organizations is not provided by the competitors.
Project portfolio management software is offered by Oracle mainly for IT industry but this software offered by Microsoft is for all the fields of work let it be manufacturing, IT, marketing, construction etc.
IBM also provides with Enterprise Content Management soft wares. These are separate soft wares that the company provide, however Microsoft Corporation integrates all the required functionality in one software providing convenience and more user friendly environment to work with in a stressful atmosphere of loads of projects running simultaneously.
Considering the above mentioned points Microsoft Corporation can price the newest Enterprise Management Software at a price which is higher than the IBM and Oracle because it has a competitive edge over the customer with respect to the blend of features and the quality of the product offered.
1. Evers, J. (2004). Microsoft rethinks unified pricing strategy. Retrieved on July 28, 2008.from http://www.infoworld.com/article/04/03/01/HNrethinks_1.html
2. Kotler, P. & Armstrong, G. (2005) Principles of Marketing.11th edn, Prentice Hall
3. Microsoft (n.d.) Product information centre. Retrieved on July 28, 2008 from http://www.microsoft.com/products/info/default.aspx?View=22on