Panasonic Toughbook: Analysis of Market Entry and Pricing Strategies

This report examines Panasonic's market entry strategy for its Toughbook rugged computer in the Australian market. It provides background information on the company and the Toughbook product, highlighting its features and target industries. The report analyzes existing pricing strategies used in Japan, including competitive pricing and cost leadership, and discusses pricing tactics like promotional offers. It then recommends specific pricing strategies for the Australian market, such as value-based pricing and price skimming, considering the product's unique value proposition and the competitive landscape. The report concludes by summarizing the key findings and recommendations for a successful market entry and expansion in Australia.

Running Head: Business to Business
Panasonic
Business to Business

Business to Business 1
Table of Contents
Introduction......................................................................................................................................2
Background Information..................................................................................................................2
Target market...............................................................................................................................2
Analysis of existing pricing strategies.............................................................................................3
Pricing tactics...............................................................................................................................3
Recommended pricing strategies for Australian market.................................................................4
Conclusion.......................................................................................................................................4
References........................................................................................................................................5

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Introduction
Panasonic Corporation is a Japanese consumer electronic goods manufacturing Multinational
Corporation. Its headquarters is situated in Kadoma, Osaka, Japan. Company was founded in
1918 as lightbulb socket manufacturing unit and has grown as one of the largest Japanese
Electronics producers. Company stands alongside Sony, Toshiba, Hitachi, etc. By 2012,
company was the fourth largest producer of television across the globe. Company has invented
unique type of laptop i.e. Toughbook. This was designed with the objective of providing master
solution for every organization irrespective of their type (Panasonic Corporation, 2018).
Organization has decided to introduce their product in Australian market with the objective of
expansion.
Background Information
In 1996, company introduced Toughbook which is a type of laptop. Toughbook is a line of
rugged computers and forms a trademark brand name owned by Panasonic Corporation. First
Toughbook was CF-25 and it is designed to resist vibration, spills, drops, high temperature as
well as rough handling. Major usage of this product is in industries such as manufacturing,
construction, defence, government health care, emergency services, oil, gas, etc. Later on in
2011, tablet line was introduced with the same specifications. In order to prove the performance
of this device, company has conducted almost 501 quality checks and tests. Before its
introduction in the market, several independent tests were conducted in order to determine the
resistance of Toughbook computers with comparison to external forces. Main motive behind
production of producing rugged laptop is to provide resolution for various challenges and issues
faced by companies in terms of technology. This laptop is designed to assist the companies in
various manners and it helps the companies to go further, attain more as well as for transforming
the best possible way. Reviewing the success of this device, organization has planned to expand
the market for this particular device. Australian market has been chosen in terms of expanding
the market of Toughbook.
In this report, background information of the company will be discussed along with describing
the type of industry. Apart from this, report will focus over the existing pricing strategies and the

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pricing tactics which will be practiced in the new target market. Further, recommendations will
be given in relevance with executing the operations in fair manner in Australia along with
attracting target audience.
Target market
Every global market, industry or organization requires unique mobility strategy in order to
support their operations structure as well as to acquire goals and objectives. The fact cannot be
denied that every company has unique requirements in relation with mobility. These
requirements are based over some standards across all vertical markets. Industrial sectors and
field-service sectors require rugged computing solution services which could be capable enough
of handling extreme environmental conditions. Due to high demand of rugged computing
solutions in Australia, Panasonic has planned to introduce their Toughbook computer in
Australian market. This device helps the Australia to improve utility services, public safety
management services, etc. Along with this, this device will help manufacturing industry,
telecommunication industry, transport and logistics industry, saving natural resources as well as
in construction industry (Yan & Pei, 2011).
Analysis of existing pricing strategies
In terms of attaining competitive advantage, organization has adopted competitive pricing
strategy while in other areas, organization implements mixed strategy which is based over
demand and supply of products and services. Panasonic Toughbook is for high end market and
this has leaded the organization to stand on the competitive position through competitive pricing
strategy. Purchasing power of citizens of Japan is quite high and the target audience for
Toughbook is business organizations, thus, they could easily afford this product (McWilliams &
Siegel, 2011). In terms of enhancing the customer base, organization has also adopted cost
leadership pricing strategy in relevance with the attainment of goals and objectives. Pricing
strategy for Toughbook in Japan has been adopted by considering its customer base; demand of
the product, business class people, geographical area, etc. Along with the cost leadership
strategy, fair price policy and mixture of various cost cutting strategies has been adopted by the
organization. These strategies are useful for penetrating the market. Primary motive of Panasonic
is enhancing sales which will ultimately enhance the profitability. Thus, reducing cost and profit

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margins is their main objectives so as to provide the products at reasonable prices to the target
audience (Li, Xu & Li, 2013). This will increase organizational sales and ultimately, it will
enhance the demand for organizational products.
While organization is now planning to expand its business and initially, Toughbook will be
launched in Australian market in order to uplift organizational performance. For penetrating the
Australian market, Panasonic has implemented its old pricing strategies i.e. cost leadership, fair
pricing strategy as well as the pricing strategy which is based over demand and supply of the
product. These pricing strategies will help the organization to set up an effective brand image in
the target market along with enhancing its global image (Nagle, Hogan & Zale, 2016). This will
also generate various opportunities for the organization to grow and expand its customer base
and market share in other parts of the globe. In relevance with the accomplishment of
organizational desired goals and objectives with regards to the expansion of Toughbook in
Australian market, these pricing strategies will proved to be more effective (Lowe & Alpert,
2010).
Pricing tactics
Pricing tactics are implemented within the workplace to attain short terms business objectives.
Pricing tactic is implemented to manipulate the prices of products and services in order to attain
organizational goals and objectives in a short period of time. For example: Panasonic has
implemented pricing tactics in Japan and under this, they reduces the prices of Toughbook for a
certain period of time in order to boost up the sales as well as to attract new customers. Apart
from reducing prices for a short period of time, organization could adopt certain effective
promotional and discount offers in order to attract the target audience in Australian market (Pillai
& Kumar, 2012). Rest, all pricing tactics adopted by Panasonic in Japanese market could be
implemented in Australian market with the objective of enhancing the sales in the target market.
Initial objectives for Panasonic in relation with new target market will be setting up effective
position and further, enhancing sales and customer base will be the primary objectives. Thus,
pricing tactics will help the organization to attain its objectives in relevance with establishment
of brand image along with gaining success and growth in the new target market (Wu & Banker,
2010).

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Recommended pricing strategies for Australian market
In order to set up effective market image in the new target market, following are certain
appropriate pricing strategies that have been recommended to the company:
Value based pricing: It is also known as value optimised pricing and it is a pricing strategy
under which prices for the products are set primary according to the estimated value of product.
In the scenario of Toughbook, value for the product is its durability irrespective of the situation.
Toughbook is designed to resist vibration, spills, drops, high temperature as well as rough
handling. Thus, the price for the product will be the actual cost of the product plus the value of
the product and plus the appropriate profit margin of the organization. With the help of this
pricing strategy, demand for the product will automatically be increased due to value proposition
offered in the product (Spann, Fischer & Tellis, 2014).
Price skimming: It is a pricing strategy under which prices of the products are set relatively high
in initial period of leaching of the product and then lowers the price over time (Zhang, Chiang &
Liang, 2014). This pricing strategy is a part of price discrimination and with the help of this
pricing strategy, organization is able to recover its invested costs quickly before increasing
competition in the market and then lowers the prices of the product in order to manage
competitive place in the marketplace. Panasonic could adopt this strategy in order to capture the
consumer surplus early in the product life cycle. This ensures exploiting monopolistic positon as
well as low price sensitivity of innovators (Rusetski, 2014).

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Conclusion
From the aforesaid information, it could be concluded that Panasonic has launched Toughbook in
Japanese market but due to low target market in Japan, organization has decided to expand its
market share by introducing the product in Australian market. In relevance with the expansion of
the market, pricing strategies of the organization has been evaluated along with the evaluation of
pricing tactics. With this regard, recommendations have been given to the company in order to
adopt appropriate pricing strategies to capture the new target market with the objective of
successful expansion.
References
Li, Y., Xu, L. and Li, D., 2013. Examining relationships between the return policy, product
quality, and pricing strategy in online direct selling. International Journal of Production
Economics, 144(2), pp.451-460.
Lowe, B. and Alpert, F., 2010. Pricing strategy and the formation and evolution of reference
price perceptions in new product categories. Psychology & Marketing, 27(9), pp.846-873.
McWilliams, A. and Siegel, D.S., 2011. Creating and capturing value: Strategic corporate social
responsibility, resource-based theory, and sustainable competitive advantage. Journal of
Management, 37(5), pp.1480-1495.
Nagle, T.T., Hogan, J. and Zale, J., 2016. The Strategy and Tactics of Pricing: New International
Edition. Routledge.
Panasonic Corporation. 2018. Toughbook. Accessed from:
https://na.panasonic.com/us/computers-tablets-handhelds [Online]. [27th April 2018].
Pillai, K.G. and Kumar, V., 2012. Differential effects of value consciousness and coupon
proneness on consumers’ persuasion knowledge of pricing tactics. Journal of Retailing, 88(1),
pp.20-33.

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Rusetski, A., 2014. Pricing by intuition: Managerial choices with limited information. Journal of
Business Research, 67(8), pp.1733-1743.
Spann, M., Fischer, M. and Tellis, G.J., 2014. Skimming or penetration? Strategic dynamic
pricing for new products. Marketing Science, 34(2), pp.235-249.
Wu, S.Y. and Banker, R.D., 2010. Best pricing strategy for information services. Journal of the
Association for Information Systems, 11(6), p.339.
Yan, R. and Pei, Z., 2011. Information asymmetry, pricing strategy and firm's performance in the
retailer-multi-channel manufacturer supply chain. Journal of Business Research, 64(4), pp.377-
384.
Zhang, J., Chiang, W.Y.K. and Liang, L., 2014. Strategic pricing with reference effects in a
competitive supply chain. Omega, 44, pp.126-135.