AtlanticComputerCase
Problem Statement
In what ways can Jason Jowers strategize the pricing for ‘Atlantic bundle’ comprising of the new Tronn server and the PESA (Performance Enhancing Server Accelerator) software tool before SME trade show?
Company Overview
Atlantic Computers was a manufacturer of servers and related high-tech products based in Amberville, New York. Jason Jowers joined the Company four months ago and was made responsible for the pricing strategy of the product “Atlantic Bundle”
Components of the Bundle:
1) Tronn: It was developed mainly for the emerging US market opportunity for basic web servers
2) Performance Enhancing Server Accelerator (PESA): This was an additional tool which would allow Tronn to perform four times faster than its usual speed for standard procedures and hence the bundling made sense by making frequently requested information extremely accessible.
Atlantic Computer & the Market
The company targeted two market segments vis-à-vis High Performance and Basic Servers. Atlantic had 20% market share in High Performance Servers with Radia being its premier product for over 30 years. There was an indication of emerging market for basic servers coming up in the late 1990s which led to the introduction of the Basic server into the market by Atlantic Computer by 2000 with a view that there will not be any cannibalization of their high performance product taking place due to the new venture. The major competition for the company in the now market segment of basic server was that from its competitor Ontario which had a 50% market share in this business with its flagship brand “Zink” Business model based on operational excellence and hence was able tx`xo curtail many non value-added costs to pose a very competitive pricing for their product.
Server Type
Segment size
Projected demand (1st yr)
Projected demand (next 2yrs)
Atlantic Market share
Ontario Market Share
High performance servers
Largest
200,000 units
3% annually
20%
Basic Servers
50,000 units
In what ways can Jason Jowers strategize the pricing for ‘Atlantic bundle’ comprising of the new Tronn server and the PESA (Performance Enhancing Server Accelerator) software tool before SME trade show?
Company Overview
Atlantic Computers was a manufacturer of servers and related high-tech products based in Amberville, New York. Jason Jowers joined the Company four months ago and was made responsible for the pricing strategy of the product “Atlantic Bundle”
Components of the Bundle:
1) Tronn: It was developed mainly for the emerging US market opportunity for basic web servers
2) Performance Enhancing Server Accelerator (PESA): This was an additional tool which would allow Tronn to perform four times faster than its usual speed for standard procedures and hence the bundling made sense by making frequently requested information extremely accessible.
Atlantic Computer & the Market
The company targeted two market segments vis-à-vis High Performance and Basic Servers. Atlantic had 20% market share in High Performance Servers with Radia being its premier product for over 30 years. There was an indication of emerging market for basic servers coming up in the late 1990s which led to the introduction of the Basic server into the market by Atlantic Computer by 2000 with a view that there will not be any cannibalization of their high performance product taking place due to the new venture. The major competition for the company in the now market segment of basic server was that from its competitor Ontario which had a 50% market share in this business with its flagship brand “Zink” Business model based on operational excellence and hence was able tx`xo curtail many non value-added costs to pose a very competitive pricing for their product.
Server Type
Segment size
Projected demand (1st yr)
Projected demand (next 2yrs)
Atlantic Market share
Ontario Market Share
High performance servers
Largest
200,000 units
3% annually
20%
Basic Servers
50,000 units