The Chair of Production Management has published a new study on optimal product design and pricing. The results of the joint work by researchers from Aalto University in Finland, ?zye?in University in Turkey and the University of Regensburg are published in the International Journal of Production Economics (external link, opens in a new window). The study examines how two companies that launch their products on the market sequentially determine product features and prices.
The study distinguishes between unique and common product features and shows how companies can optimize their decisions depending on the behavior of the competitor. A key finding is that even if both companies are on an equal footing, it can be advantageous for the first company to offer a simpler product in order to achieve higher profits.