Case Studies

London Business School

This case study involves the merger of Roche Diagnostics’ Molecular Diagnostics and Applied Science business areas in Germany. The merger, which was initially motivated by a combination of converging needs among commercial diagnostic laboratories and research hospitals, product-portfolio synergies, operational efficiencies, improved customer management, and an increasingly competitive marketplace, brought to light potentials in the way Roche Diagnostics generated revenue from its products and services. While these go-to-market-strategies may have well existed for a number of years, the move to a single sales force calling on customers across the two business areas required the need for a sustainable, integrated pricing approach. One of the key questions occupying Doctor Bodo Eickhoff (Senior Vice President of Sales and Marketing for Applied Science and Molecular Diagnostics in Germany) and his team concerned the appropriate revenue model under the revised organizational structure.

Harvard Business School

Harvard Business School

London Business School

It is October 2009 and Gary Fry, chief executive officer of Global Graphics, is faced with a tough decision. Global Graphics — a technology expert with 20 years experience in developing and selling printing equipment and software exclusively to original equipment manufacturers — is about to release a revolutionary desktop PDF application targeted directly at office workers. With less than two months before the official launch, however, there is still considerable debate on what the actual price of the product should be. Fry is adamant that the “right” price will help Global Graphics achievethe ambitious sales and customer acquisition objectives set by the management team. In addition, he understands the importance of establishing Global Graphics as a viable alternative to Adobe, the undisputed leader in the end user market for business software. What is the price point that best serves these seemingly conflicting goals?

Harvard Business School

London Business School

This case describes the actions taken by British Telecom’s business unit (BT Business) in response to the radical ‘free broadband forever’ offer introduced by The Carphone Warehouse (TCW) in April 2006. At the time of the campaign, BT Business held a dominant share of the lucrative (and fast growing) broadband market in the UK. TCW’s bold move clearly threatened that position. More important, BT Business was concerned that larger competitors (Vodafone, BSkyB, O2, etc) would follow suit, therefore initiating a price war that in all likelihood would erase profitability in the industry. The main learning points from this case involve pricing and competitive strategy. In particular, BT Business’ problem touches on a number of important questions, including: (1) maintaining price leadership; (2) managing price competition and the threat of customisation; and (3) designing product bundles that capture customer value and act to discourage competition. In addition, this case provides a good example of the challenges often faced by large firms (especially former monopolies) attempting to improve customer orientation. Prior to ‘free broadband forever’, BT had tried unsuccessfully on a number of occasions to shift its organisational structure away from product lines (fixed telephony, mobile voice and data, broadband, etc). Interestingly, they succeeded only in the face of a significant and immediate competitive that ‘helped’ generate the necessary motivation and momentum.

London Business School

This is two-case series discusses some of the key marketing decisions faced by Eric Baker and the rest of his management team immediately before and after the launch of viagogo in the United Kingdom and other European markets. viagogo is an on-line marketplace where sellers and buyers can exchange live event tickets (sports, entertainment, etc) in a legal and secure manner. The underlying business model replicated the one introduced by StubHub in the United States, a company founded by Eric Baker and a fellow Stanford MBA a few years earlier. The first part of the case is set in June 2006, just two months before the official launch of the website. At that time, the case protagonists faced important decisions with respect to the company’s revenue model. In particular, they had to determine what level of commission to charge, how to split this commission across sellers and buyers, and what pricing mechanism(s) to use (ie, fixed price, auction, and / or declining price). Eric was also considering a potential partnership with a major football club in the UK. A deal was expected to generate considerable exposure for viagogo but, on the other hand, required significant investment and likely constrained the company’s promotional options. The second part of the case takes place in early 2008. Following a brief review of viagogo’s initial performance, a series of new challenges are introduced: (1) how to deal with increasing competition; (2) how to improve the general perception of secondary ticketing in the marketplace; and (3) how to scale the business up from start-up to middle-sized enterprise. Overall, the case highlights common challenges when launching a new business venture. It also questions the common belief that a successful business model in one country can be easily replicated in another. Finally, the case allows for a discussion of how business models tend to change as industries ‘mature’ and new opportunities arise.