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Prices and Sales in Australia’s Mobile Market

Market development strategy

In the modern contemporary telecommunication industry, several factors, both internal and external, influence companies in the industry when developing pricing strategies. The following are the external factors that influence pricing strategies adopted by companies in the telecommunication industry in Australia:

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  • The competition among the firms; as every player company tries to win a large market share.
  • New development in the industry and alliances among.
  • The global environment and international competition has lead to an increasing number of players in the industry.

The economy pricing method is the best pricing strategy that a company in an environment of high competition should use. It is a pricing model that aims at keeping the price of commodities low; it uses organizational advantages to sell large volumes of products at a relatively low price. The company should ensure that it benefits from the masses rather than concentrating on a large profit margin. The economy method does not give a high-profit margin to the company but allows the company to sell on a large scale and attract masses because of the fair price, the net effect is an increased profit from the little margin from a big mass (Kotabe and Helsen, 2004).

When using the method, costs should be controlled and ensured they remained, as low as possible; any move by the company that can lead to reduced prices should be prioritized and implemented the fastest possible. The economy pricing model is supported by improvement on quality and a combination of other models that can give rise to high customer satisfaction and develop/keep their loyalty. For example, low prices offered by Vodafone in Australia has made the company to be the choice of many, to keep the customers coming, the company has customer loyalty programs (Kerin and Peterson, 2009).

Improving sales processes

Current price wars in the Australian phone industry have been brought by increasing players in the market; in their efforts to get a high market share, companies end up lowering their services.

To challenge leaders in the industry, small companies should invest in their internal strength to be able to see a niche in the market that has not been adequately addressed by the prevailing market condition then develop programs that address the area. The internal factors that are likely to affect the pricing decision include the level of efficiency in the company; the rate of innovativeness and the profit margin (Rakesh, 2005).

The internal environment can be improved through continuous improvement of processes products and creating an environment that encourages innovation among staff. When this has been attained, then a small company will have a competitive edge over other well-established firms and multinationals (Möller, 2006).

The best pricing approach that an innovative micro company in the industry can use is the premium-pricing method. The approach adopted by premium pricing models is the selling of products at relatively high prices than that offered by the competitor. The strategy is particularly effective with unique or new products in the market; niche markets are willing to sell their goods higher making a high-profit margin than their competitors in other sectors (Kurtz, MacKenzie and Kim, 2009).

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Apple Inc. is an international company that has successfully used a premium-pricing model to sell its products. It puts more emphasis on innovating better products then floating them to the market at a relatively higher price than engaging in price wars. This assists the company tap niche-markets from time to time; with a niche market, the company can sell its products slightly higher than its competitors are.


Kerin, R. A. and Peterson, R. A. , 2009. Strategic Marketing Problems: Cases and Comments. London: Pearson Education.

Kotabe, M. and Helsen, K. , 2004. Global Marketing Management.New York: John Wiley & Sons.

Kurtz, L., MacKenzie, F. and Kim, S., 2009. Contemporary Marketing. New York; Cengage Learning.

Möller, K., 2006. Marketing Mix Discussion – Is the Mix Misleading Us or is We Misreading the Mix?. Journal of Marketing Management, 22(3), pp. 439-450.

Rakesh, J., 2005. International Marketing. New Delhi: Oxford University Press.

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