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  • Multi component Profit Model

    Multi Component Profit Modal
    This model allows a company to offer the exact same product in various settings and packaging, at vastly different price levels. Company can offer the same exact product at vastly different prices.
    This model is only possible when a company has a very deep brand loyalty with the market and a large market share, so much that little to no viable competition exists.
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    Example
    1. The best example is Coke Cola. You buy the same product at different prices (according to price sensitivity at each) at a vending machine, a supermarket or a restaurant.
    2. Second example of railway tickets same product but price is different example Tatkal, premium etc.
    3. Water bottles buy different prices at a different business. Retailer, branded fast food chain.

    Attached Files

  • #2
    Multi-Component Model
    • This model applies where a single product is applied at a different price to different channels.
    • Let’s take example is Coke Cola. You buy the same product at different prices like at a vending machine, a retail store or a restaurant.
    • Customers usually are consistent to all channels rather than just one. The situation i.e. where they are and from where they buy.

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    Examples

    1Ice Creams same ice cream is given in different place like if you have it from their outlet it will differ from restaurant price.
    2 Spa like if you take it from mall it will have different rate and if you take it from hotel the price will be different in different channel.
    3 Cigarettes the price will be different if you buy it from unorganised store as compared if you buy it from mall or in restaurant.
    Attached Files

    Comment


    • #3
      MULTI-COMPONENT MODEL


      This model permits an organization to offer precisely the same in different settings and bundling, at tremendously extraordinary value levels.

      By appealing to a people's extraordinary, situational needs, an organization can offer the same correct item at endlessly unique costs. Since shoppers will regularly purchase an item to a great extent because of persuasion, they will pay significantly more in on setting then they would for that identical item in another.

      This model is just conceivable when an organization has a profound brand reliability with the market and a large market share of the overall industry, so much that practically no feasible rivalry exists; since you are so faithful to that organization you will pay more. The organization makes expansive parts of there benefit in specific settings, and next to no in others.

      Example:

      1. RailwayTicket: As there is monopoly in the Indian railways system, Customers will pay whatever the amount because of the high demand for the ticket. Even if tickets are sold in tatkal people buy railway tickets.
      2. Maggi: You can buy the same exact product, for vastly different prices depending on the location, whether its a vending machine, hilly area, restaurant, or grocery store.
      3. Jack Daniel: The alcohol brand Jack Daniel has a high brand loyalty. Thus people will pay more even though the price may differ in Unorganised sector, Restaurants, Hotels.
      http://gph.is/1jZKy4a

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      • #4
        Multi Component Profit
        This model allows a company to offer the exact same product in various settings and packaging, at vastly different price levels, a confusing concept for me to understand at first but I learned that it becomes clearer when you see it in practice. By appealing to an individual’s unique, situational needs, a company can offer the same exact product at vastly different prices. Because consumers will often by a product largely due to convince, they are willing to pay much more in on setting then they would for that exact same product in another. This model is only possible when a company has a very deep brand loyalty with the market and a large market share, so much that little to no viable competition exists; because you are so loyal to that company you are willing to pay more. The company makes large portions of their profit in certain venues, and very little in others.
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        1. Fanta can be brought for vastly different prices depending on the location, whether it is a vending machine, restaurant, retail store etc.
        2. Lays can be brought for vastly different prices depending on the location, whether it is a retail store, railway station, airport, malls etc.

        The company should use this model for gaining more profit from same product in different places. So, most of the companies are following this model.
        Attached Files

        Comment


        • #5
          MULTI-COMPONENT PROFIT


          Same product, Several businesses.

          In this model, Company offer a range of product/services that includes higher margin specialty items and loss leading, high demand services. Multiple products and/or sales channels, and only some of these represent the bulk of profitability. To maximize sales in the high-profitability components, it's necessary to have full presence in the less-profitable components as well.
          Different parts of a business can have wildly different profitability.



          Example

          Multicomponent profit models apply to industries as diverse as
          beverages (the profit is in fountain and vending)

          In coffee, the components are grocery, cafés, and kiosks.
          Grocery is low margin, cafés are high margin, and kiosks are even higher still
          Procter & Gamble, Nestle, and General Foods play against each other in grocery and break even.
          Starbucks plays in cafes and kiosks and enjoys extraordinary returns.

          Comment


          • #6
            Multi component profit

            Multi component profit model says that company’s same product has different prices at different businesses that means product is same but the price of product will be different at different businesses like 750 ML Coca-Cola the price at retail shop will be very low and the price of the product at movie theatre will be high so the profit will be more at theatre but the customer can be same at all the different area. In total multi component means the product or service will be same but having different profits

            Examples

            Railway Ticket - Railways has three different categories like normal booking, tatkal, premium tatkal for booking of seat and the prices of all the categories are different but the services offered but railways are same.

            Indigo Airlines- Indigo has different price of same seat but at different timings like if we book seat of indigo 3 months before the price will be low but if we book the same seat one day before the price will be very high in the case customer is same but paying different amount of same product.

            Comment


            • #7
              MULTI-COMPONENT PROFIT:-

              The third theory in Art Of Profitability is Multi-Component Profit. According to this theory a company sale to the customer to a same product in the distinct market component. It means company charge different different cost of their product according to the market component. In this theory same customer pay distinct cost for one product according to their need. In this theory customers usually are consistent to all channels rather than just one. We can say in one line that is-“Same product, different market component.”

              For Examples:-
              Indian Railway Tickets:- Railway department charges are different different according to their selecting categories like that if you are booking your ticket through normal booking, tatkal or premium tatkal booking for one distance to another distance them you have to pay distinct charges but you get same service in all conditions.

              Air Asia Flight Tickets:- Air Asia flight tickets are three types economy, premium economy and business. All the three categories you get same service to reach one distance to another distance n less time period but paid distinct charges according to your flight tickets.

              Bisleri Water bottle:- A customer buy a drinking bottle from local grocery shop, restaurant and vending machine, all the three conditions customer paid different different cost for same product.

              Frito-lay:- Same product nachos chips but when customer buy this product from distinct market component then customer pay distinct price.

              Lakme Facial:- Customer go to the beautyparlour for facial, he is using only brand’s facial. But when customer go low to high cost beautyparlour then customer pay distinct cost for same brand lakme brand’s facial.

              Attached Files

              Comment


              • #8
                MULTI COMPONENT THEORY
                The third theory is multi component theory. In this theory the single product is selling on different price as per different places. And different price are charged with same person.
                It simply means the product which we purchase in multiplex, restaurant, and hotel. For the same we pay different prices.

                Examples:-
                • For Lays chips we pay different different price as per the place in restaurant and multiplex.
                • Alcohol we pay different price in shop, bar and hotel.
                • For Pepsi we pay different price as per place.
                Attached Files

                Comment


                • #9
                  Multi component profit
                  According to multi component profit model a company can provide product In different business. Multi component profit model says that company’s same product has different prices at different businesses that means product is same but the price of product will be different at different places. In total multi component means the product or service will be same but having different profits
                  Example:-
                  1. For cold drink we pay different amount in a small shop and we pay different amount in Movie Theater.
                  2. We pay small amount in market for a packet of popcorn but in a movie theater we pay more and in shopping mall we pay different amount.

                  Comment


                  • #10
                    Multi-Component Profit
                    This model is about they provide same product but in many ways, a company can offer the same exact product at vastly different prices. In this model same customer pay distinct cost for one product according to their need. They target the entire customer who needs that product. Because consumers will often by a product largely due to convince, they are willing to pay much more in on setting then they would for that exact same product in another. This model is only possible when a company has a very deep brand loyalty with the market and a large market share; so much that little to no viable competition exists
                    For example-
                    RAILWAY- railway provides the all type of facilities general to ac class.
                    KAYA FACIAL- Customer go to the beauty-parlor for facial, he is using only brand’s facial. But when customer go low to high cost beauty-parlor then customer pay distinct cost for same brand KAYA.

                    Attached Files

                    Comment


                    • #11
                      Multi Component Profit

                      This model allows a company to offer the exact same product in various settings and packaging, at different price levels. Company offers a range of product/services that includes higher margin specialty items and loss leading, high demand services. It means company charge different different cost of their product according to the market component. In this theory same customer pay distinct cost for one product according to their need. In this theory customers usually are consistent to all channels rather than just one. This model applies where a single product is applied at a different price to different channels.

                      Attached Files

                      Comment


                      • #12
                        MULTI-COMPONENT PROFIT MODEL

                        Multi-Component Profit Model permits the company to sell exactly same product in different locations at varied prices. The company has a base business and a number of component businesses. Convenience of the customer plays a vital role in this model as they will be willing to pay more in a particular business location for the same product than on another.

                        Applicability of the Model:-

                        • Customers are loyal towards the company’s product.

                        • Company has large market share.

                        • Low competition in the market.

                        Few of the companies using this model:-

                        Coca-Cola uses this model and charge differently at restaurants, hotels, cinema halls, vending machine etc for the same cold drink.

                        • Same packet of Kurkure can be bought at railway station, cinema hall, convenience store etc at different prices.

                        Comment


                        • #13
                          Multi-component profit is the third theory. It depicts a single product which is applied at a different price to different channels. A particular business can earn a high amount of profit if multi-component model is implemented properly as it cannot be applied in every kind of business. If we analyse properly we can find that this model leas to:
                          • Efficient utilisation of assets.
                          • Costs of production are reduced.
                          • Increased capacity etc.
                          In simple words it means single product and different businesses.
                          Attached Files

                          Comment


                          • #14
                            Multi Component Model

                            According to this theory, a company deals in a particular product or type of product which is sold to consumers at different prices who purchase it at different channels. Majority of market share, brand loyalty and an efficient distribution is required for implementation of this model. It is also supported by monopolistic market environment. It is limited to few types of industries such as Food & Beverages, Hospitality, Books and few more.

                            Examples:

                            Pepsi: It has different prices at different sales channels such as grocery store, restaurants, cinema halls etc.

                            Air Costa: It offers different prices at online & offline sales channels which also vary with demand.

                            Carlson Rezidor Hotel Group: It also offers different prices at different price of sale whether it may be online or offline.


                            Companies which don't use this model are Hero motocorp, Western Coalfields Limited, Vizag Steel Plant.

                            Comment


                            • #15
                              MULTI-COMPONENT PROFIT

                              This model permits an organization to offer precisely the same in different settings and bundling, at tremendously unique value levels, a mistaking idea for me to comprehend at first yet I discovered that it moves toward becoming clearer when you see it by and by. By speaking to an individual's one of a kind, institutional requirements, an organization can offer the same correct item at tremendously extraordinary costs. Since shoppers will frequently by an item to a great extent because of persuade, they will pay substantially more in on setting then they would for that identical item in another. This model is just conceivable when an organization has a profound brand dependability with the market and an expansive piece of the pie, so much that practically no suitable rivalry exists; since you are so faithful to that organization you will pay more. The organization makes extensive segments of their benefit in specific settings, and next to no in others.
                              Profit-Models-3.jpg


                              Examples:-
                              1. Indian Rail ways different pricing in different times due to dynamic surcharge and also variant like Tatkal is there so pricing is different.
                              2. OYO Rooms provide same kind of facilities to the same customers at different prices in different destinations and occasions also depends upon when a customer is booking.
                              3. Bailey water bottle or Bisslery water bottle from local grocery shop, restaurant and vending machine, all the three destination the customer pays different price for same product.
                              4. Banks pitches single item to an indistinguishable client from various banks may have diverse standards and controls in regards to similar items like investment account, current record, Life Insurance, and so forth.

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