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TOTAL COST OF OWNERSHIP IN SALES AND MARKETING

Orlander Arvola, Ville and Eriksson, Axel (2015) MIO920
Production Management
Abstract
Background: There is an internal belief within Axis that despite their products’ relatively high
initial price, the total cost of ownership (TCO) of an Axis camera solution is lower
than that of other brands. However, there is no internal research or tools to verify if
it is true. Without this, Axis is unable to communicate their belief in an educated
and quantifiable way, which is desired in sales and marketing situations.



Purpose: The purpose of this master thesis is to create a TCO analysis framework for a
network based video surveillance solution from a seller perspective. The framework
is then to be applied on Axis’s solutions to identify and weigh the most important
parameters that affect the TCO. Based on... (More)
Background: There is an internal belief within Axis that despite their products’ relatively high
initial price, the total cost of ownership (TCO) of an Axis camera solution is lower
than that of other brands. However, there is no internal research or tools to verify if
it is true. Without this, Axis is unable to communicate their belief in an educated
and quantifiable way, which is desired in sales and marketing situations.



Purpose: The purpose of this master thesis is to create a TCO analysis framework for a
network based video surveillance solution from a seller perspective. The framework
is then to be applied on Axis’s solutions to identify and weigh the most important
parameters that affect the TCO. Based on this, a TCO analysis model that can be
used by Axis’s sales force is to be developed.



Methodology: The overall methodology used in the project is action research in combination with
descriptive, exploratory and problem-solving approaches depending on the specific
research question. The theoretical methodologies have been integrated with a TCO
development and implementation framework, which has formed the research
process.



Conclusions: Existing literature offers a range of TCO frameworks, but little research has been
done regarding TCO from a seller perspective. A TCO analysis is very case specific,
why generic models are not appropriate. A new framework for the development of
a TCO sales tool is therefore proposed, which is adapted and provides detailed
guidelines to the network camera surveillance industry. Using this framework, more
than 50 cost factors that affect the TCO of a camera solution have been identified
and categorised. These were then implemented into a sales tool that can be used to
analyse and demonstrate costs and benefits.



The significance of the cost factors affecting the TCO for a camera solution varies a
lot. For sales and marketing purposes, the parameters that the company can
influence and that differentiate a product from another should be emphasised. The
benefits for companies to utilise TCO in sales and marketing are several, even
though there are some distinct barriers to overcome. For Axis, the developed TCO
sales tool can be a strategic resource to help convince its customers to shift their
focus from a low-price mind-set to a pursuit of low-cost solutions. (Less)
Please use this url to cite or link to this publication:
author
Orlander Arvola, Ville and Eriksson, Axel
supervisor
organization
alternative title
Demonstrating Value beyond the Price at Axis Communications AB
course
MIO920
year
type
M1 - University Diploma
subject
keywords
Axis., network based video surveillance, cost factors, seller perspective, framework, marketing, sales, total cost of ownership, TCO
other publication id
15/5521
language
English
id
7869348
date added to LUP
2015-09-18 09:57:42
date last changed
2015-09-18 09:57:42
@misc{7869348,
  abstract     = {Background: There is an internal belief within Axis that despite their products’ relatively high 
initial price, the total cost of ownership (TCO) of an Axis camera solution is lower 
than that of other brands. However, there is no internal research or tools to verify if 
it is true. Without this, Axis is unable to communicate their belief in an educated 
and quantifiable way, which is desired in sales and marketing situations. 

 

Purpose: The purpose of this master thesis is to create a TCO analysis framework for a 
network based video surveillance solution from a seller perspective. The framework 
is then to be applied on Axis’s solutions to identify and weigh the most important 
parameters that affect the TCO. Based on this, a TCO analysis model that can be 
used by Axis’s sales force is to be developed. 

 

Methodology: The overall methodology used in the project is action research in combination with 
descriptive, exploratory and problem-solving approaches depending on the specific 
research question. The theoretical methodologies have been integrated with a TCO 
development and implementation framework, which has formed the research 
process. 

 

Conclusions: Existing literature offers a range of TCO frameworks, but little research has been 
done regarding TCO from a seller perspective. A TCO analysis is very case specific, 
why generic models are not appropriate. A new framework for the development of 
a TCO sales tool is therefore proposed, which is adapted and provides detailed 
guidelines to the network camera surveillance industry. Using this framework, more 
than 50 cost factors that affect the TCO of a camera solution have been identified 
and categorised. These were then implemented into a sales tool that can be used to 
analyse and demonstrate costs and benefits. 

 

The significance of the cost factors affecting the TCO for a camera solution varies a 
lot. For sales and marketing purposes, the parameters that the company can 
influence and that differentiate a product from another should be emphasised. The 
benefits for companies to utilise TCO in sales and marketing are several, even 
though there are some distinct barriers to overcome. For Axis, the developed TCO 
sales tool can be a strategic resource to help convince its customers to shift their 
focus from a low-price mind-set to a pursuit of low-cost solutions.},
  author       = {Orlander Arvola, Ville and Eriksson, Axel},
  keyword      = {Axis.,network based video surveillance,cost factors,seller perspective,framework,marketing,sales,total cost of ownership,TCO},
  language     = {eng},
  note         = {Student Paper},
  title        = {TOTAL COST OF OWNERSHIP IN SALES AND MARKETING},
  year         = {2015},
}