Optimal pricing of a personalized product

Suresh P. Sethi

doi:10.1007/s11518-008-5062-1

Journal of Systems Science and Systems Engineering ›› 2008, Vol. 17 ›› Issue (1) : 30 -35. DOI: 10.1007/s11518-008-5062-1

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Optimal pricing of a personalized product

Suresh P. Sethi ¹^,^a

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Abstract

This paper deals with optimal pricing of a personalized product such as a personal portrait or photo. A new model of the pricing structure inspired by two real-life cases is introduced to the literature and solved to obtain optimal photo sitting fees and the final product price. A sensitivity analysis with respect to the problem parameters is performed.

Keywords

Personalized product / pricing / salvage loss

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Suresh P. Sethi. Optimal pricing of a personalized product. Journal of Systems Science and Systems Engineering, 2008, 17(1): 30-35 DOI:10.1007/s11518-008-5062-1