Early in 1996, the long awaited Macintosh "clones" hit the market. To see how Apple and the new MacOS-compatible hardware manufacturers are responding to this rapidly changing market environment, take a look at the following homepages:

Apple http://www.apple.com

UMAX http://www.supermac.com

DayStar http://www.daystar.com

a) How do you think this new environment will initially affect pricing for these products? How might this change over time as more Macintosh "clones" are introduced? Do you think it was a good idea for Apple to allow other manufacturers to produce Macintosh-compatible systems? What are the strategic advantages and disadvantages of this licensing arrangement for Apple?

b) To get an idea of how much consumers actually pay for these systems, use the following mail-order retailer sites to do some comparison shopping. In this case, you will be comparing prices for Apple vs. UMAX.

MacMall http://www.macmall.com

MacWarehouse http://www.warehouse.com/MacWarehouse/

MacZone http://www.maczone.com

What kind of price differences did you find between comparable systems from Apple and UMAX? Give two examples. Does this correspond to what you expected based on what you read in the case study? If not, how do you explain the inconsistency? If so, what does this demonstrate about Apple's new market formula?

Imagine you are shopping for a home computer and you've chosen Dell Computer as the source for your new PC. Go to the Dell homepage and select a complete system that would best suit your needs. Once you have made your selection, answer the questions below.

Dell Computer http://www.dell.com

What is the meaning of price for the product you selected? Use the authors' expanded definition of price on p. 274 to guide your answer. How does this definition differ from the common, narrow definition most people think of? Why is it important for marketers to make this distinction?

How would you define value with respect to the primary products and/or services offered by the following companies? What value standards do they have in common? In what ways are they different in terms of value measurement? Why is it important for marketers to understand these variations?

U-Haul http://www.uhaul.com

Swatch http://www.swatch.com

Showtime http://www.showtimeonline.com

Identify and describe the pricing objectives that most naturally apply to the following products. Explain why these pricing objectives are appropriate for the respective competitive environments in which these organizations operate.

United Lubricants http://www.UnitedLubricants.com

L'Eggs https://www.pantyhose.com

Girl Scout Cookies http://www.girlscouts.org

Florida Power and Light http://www.fpl.com

Simply put, you can buy compact discs via the Web for prices well below those you'll find at your local record store. Don't believe us? Choose a handful of your favorite artists and do some comparison shopping. Here are just two of the many CD resellers you'll find on the Web:

CD Connection http://www.cdconnection.com

CD Universe http://www.cduniverse.com

How can cost-plus pricing explain the substantially lower prices offered by the above companies as compared to traditional retail outlets?