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  • October 2020 (Revised May 2023)
  • Exercise

SenseAim Technologies: Pricing to Win

By: Elie Ofek, Eyal Biyalogorsky, Marco Bertini and Oded Koenigsberg
  • Format:Print
  • | Language:English
  • | Pages:2
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Abstract

This exercise serves to help students understand the proper role and use of costs in a firm’s pricing decisions. The exercise is designed such that the learning of students evolves across a classroom session, starting from understanding which costs are relevant when setting the price of a product, progressing to a discussion on the wisdom of the traditional “cost-plus” approach to pricing, and ending with a demonstration of how to leverage cost information to construct an iso-profit curve—which, in turn, serves as a useful benchmark to assess possible price changes. These topics emerge as the result of hands-on calculations, where students make recommendations based on the data provided in the exercise, and in-class discussion, where students defend their preferred course of action and reflect on the biases and heuristics that may lead managers to misuse costs in pricing decisions.

Keywords

Pricing Decisions; Cost; Information; Price; Decision Making

Citation

Ofek, Elie, Eyal Biyalogorsky, Marco Bertini, and Oded Koenigsberg. "SenseAim Technologies: Pricing to Win." Harvard Business School Exercise 521-049, October 2020. (Revised May 2023.)
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About The Author

Elie Ofek

Marketing
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Related Work

    • February 2024
    • Faculty Research

    SenseAim Technologies: Pricing to Win

    By: Elie Ofek
    • October 2020 (Revised May 2023)
    • Faculty Research

    SenseAim Technologies: Pricing to Win

    By: Elie Ofek, Eyal Biyalogorsky, Marco Bertini and Oded Koenigsberg
Related Work
  • SenseAim Technologies: Pricing to Win By: Elie Ofek
  • SenseAim Technologies: Pricing to Win By: Elie Ofek, Eyal Biyalogorsky, Marco Bertini and Oded Koenigsberg
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