Using the following article:

Virgin Mobile USA: Pricing for the Very First Time

Answer the below.

1. Given Virgin Mobile's target marketing (14 to 24-year-olds), how should it structure its pricing? The case lays out three pricing options. Which option would you choose and why? In designing your pricing plan, be as specific as possible regarding the various elements under consideration (e.g., contracts, the size of the subsidies, hidden fees, average per-minute charges, etc.)

2. How confident are you that the plan you have designed will be profitable? Provide evidence of the financial viability of your pricing strategy.

3. The cellular industry is notorious for high customer dissatisfaction. Despite the existence of service contracts, the big carriers churn roughly 24% of their customer each year. Clearly, there is very little loyalty in this market. What is the source of all this dissatisfaction? How have the various pricing variables (contracts, pricing buckets, hidden fees, off-peak hours, etc.) affected the consumer experience? Why haven't the big carriers responded more aggressively to customer dissatisfaction?

4. What do you think of Virgin Mobile's value proposition (the VirginXtras, etc.)? What do you think of its channel and merchandising strategy?

5. Do you agree with Virgin Mobile's target market selection? What are the risks associated with targeting this segment? Why have the significant carriers been slow to target this segment?