Xm Radio Case Pricing

773 Words4 Pages
XM Satellite Radio: Pricing Case Report 1 | | | | Problem Statement XM is a newly stablished company that is facing the challenge to develop a successful business plan in order to achieve the right positioning in the satellite radio market. Situation Analysis Currently we can find several players in the radio market, providing terrestrial broadcasters or even Internet radio for free. As mentioned before the increasing mobility is changing the customer needs, which the current players are not able to satisfy. Therefore SIRIUS and XM were allowed access to the market, introducing a new technology (satellite radio) offering high quality service and wider geographical coverage in the United States. We can differentiate between home radio listeners and car radio listeners, where early technology adopters and technology friendly users, will be segment willing to pay an extra for the premium quality and service. Another noteworthy features lies in the fact that no OEM, aftermarket car head units producer or home rack audio systems / receivers manufacturers have yet implemented the technology required to be able to enjoy this new satellite radio service. Alternatives: Pros | Cons | * Less time consuming | * No differentiation | * Commercial free | * Second mover consequences | * Simple Costing Structure | * Huge marketing costs to attract customers | 1. The “follower” strategy: It will basically consist on replicating SIRIUS’s business model and strategic approach and charge customers a $10 subscription fee for the 50 radio channels. 2. The “improved traditional radio”: We will position as a high quality radio services provider with high geographical coverage, competing directly with free broadcasters (FM/AM). Pros | Cons | * Free Usage leads to attractive product proposition for buyers. | * Advertising | * High

More about Xm Radio Case Pricing

Open Document