AbstractsBusiness Management & Administration

Establishing a pricing structure for software products : Case study: Viope Solutions Oy

by Tram Nguyen

Institution: Laurea-ammattikorkeakoulu
Year: 2013
Record ID: 1140025
Full text PDF: http://www.theseus.fi/handle/10024/64924


This thesis is a case study that explores how to establish a pricing structure for software products. The objective is to provide a guideline to establish a pricing structure for Viope Solutions Oy. A new pricing structure is crucial for the company due to recent changes in its business such as internationalisation and new product launches. The literature review introduces five attributes of a pricing structure. They are the unit definition, price determination, price segmentation, versioning, and bundling. Much research shows that different customers value a product differently. This leads to the challenge of how a pricing structure could capture the heterogeneity in the customers’ perceived value. The five attributes are tools to establish a pricing structure that could perhaps resolve this challenge. From the perspective of the software business, the author studies and analyses how software products are priced and licensed. A software pricing model in general is broken down into four factors which are what is sold, license options, license terms, and payment methods. There is no complete and fixed model to price software products. Thus, a software pricing model should be established based on the product’s value to customers as well as the companies’ business objectives. The empirical study was conducted using a qualitative research method. The study uses both secondary and primary data. The secondary data was gathered from companies’ annual reports and experts’ analyses. The primary data was collected from field observations and semi-structured interviews with Viope’s owner. The data was then analysed using grid analysis technique. A direction to establish Viope’s pricing structure is the final outcome of this thesis. It explains how to segment Viope’s customers, how to create different versions of its products, how to bundle its offerings, and how to select a suitable pricing model.