I need help writing a peer response

Orginal Question: Research

Research pricing as it applies to your offering and industry. Consider your options for pricing. Consider your market position in determining your price.

Discuss

What will your price point be?

Briefly discuss how you arrived at this price.

How does this support your market position?

Peer Answer:

The price and perceived value are often closely related to consumers. Value is derived from how customers view the product's overall value and how much the consumer individually values the product (Hydock \& Wathieu, 2023). Netflix's lowest price tier is $6.99 per month with ads. This is one dollar per month lower than both Disney plus and Hulu plus, and three dollars per month less than HBOMax. The price per month of Netflix without ads however is at higher price point than its competitors options without ads. When considering its pricing strategy for Netflix's newly launched ad revenue tier, the company stated that its goal was for any customer that switched to the cheaper ad supported tier to have a neutral to positive impact on revenue for Netflix (Sherman, 2022). At this time, I feel that Netflix's pricing structure should remain as it is currently offered by the company. The introduction of a cheaper ad based tier to Netflix's pricing options is a relatively new strategy, and has added greater price segmentation to Netflix's offerings. Additionally, the introduction of the ad supported tier can both bring in new customers and keep existing customers from leaving the company altogether by offering a cheaper alternative in an inflationary environment where they are looking at ways to decrease expenses. Additionally, Netflix has adopted a recent policy where users can no longer share passwords. Increasing prices at this time may further alienate customers and turn them off to the brand. Finally, by keeping Netflix's lowest priced tier below their current competitors will hopefully entice customers using a relative or friend's login to create their own account. Finally, value must be considered in pricing decisions. Netflix, as well as other online streaming service customers have continued to perceive a decreasing value from their subscriptions despite rising prices. This is due to shrinking catalog content and cancellation of popular shows. Therefore, Netflix should not consider raising prices without increasing the perceived value to customers, especially following the bad PR from their password sharing crackdown. Netflix should first focus on marketing their brand as the best in the streaming business, with the most shows and movies that people want to watch (Punwasee, 2022)