Imag Case Study

Johnny needs to charge a price to readers that would like to access iMag. If the magazine is free, it is reasonable that more readers will access to it, but at the same time the business will not generate enough profit to keep the business alive. Advertisements do not guarantee, and generate enough profit unless the magazine become very popular, which might be an option for the long run, when the magazine gets brand recognition. By charging readers a price to access iMag, it will start generating profit as soon as the magazine is launched, the profit will help to cover some of the business expenses to update the magazine, and to maintain the quality of the application.
There are three prices that can be used to price iMag:
$2.99; expected sales

If iMag is priced higher, there would be less units sold, and less revenue.
The two main competitors for iMag; “Post” and “Project”, are priced $2.99 per unit. I did not choose to price iMag with the same price as the competitors, because if iMag is priced at $2.99, it will get less units sold, and less people will be interested in the magazine. There are already two competitors with the same prize, and the same pricing of the three magazines will create a division of the costumers to choose only one of the three magazines. By pricing iMag one dollar less than the competitors, iMag will get an advantage price that which will lead to increase of profit, increase of costumers’ interest, and higher sales volume.
Another option is to offer the costumers a free trial of iMag for few days, the free trial will offer a restricted access to the magazine, with certain content that will be only available to customers that pay for the magazine fee and upgrade to the normal version. With the free trial, iMag can include some kinds of advertisement and generate revenue from it. This way, iMag will be generating revenue from two different