This case follows a multidisciplinary team at Kalmar, a business unit of Cargotec, to develop a new product based on telematics and then the challenge of how to price the product/service for value in the context of customers who would not typically pay for such a thing. The Kalmar team had been thrown a somewhat ambiguous challenge with a tight timeframe of a mere ten weeks. Through customer-site visits including observation and discussions, the team had come up with a unique digital offering for cargo handling port terminals that could potentially deliver real value for customers and help Kalmar differentiate itself from competitors. As the team formulated plans for a pilot, some key questions remained, in particular, how to structure a price for the service? Kalmar Insight could help customers improve operational efficiency and profitability but how could Kalmar put a price tag on this value? The case looks at the different options open to Kalmar.
- This case illustrates to students how observation of customers and conversations about their needs can lead to innovative ideas leveraging off digital technology.
- It also illustrates a value based pricing approach to how to price a new innovation in an segment where the value has previously not be quanitified nor explored.
Kalmar, Logistics and Supply Chain, Shipping
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