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Sell (Customer) Cost

In the customer life-cycle cost of a product, used to develop product and service innovations, the cost an Intermediary Customer incurs to display the product for sale, to train its sales people to sell the product, and to help the final customer find the product, choose among alternative products and pay for the product. (See also Obtain Cost, Guarantee Cost, and Return Cost.)

Example 1:

Iomega's zip drive first made gains as an external peripheral, but PC makers are now bundling it with their wares. Packard Bell and Acer install Zip drives in some models. (Year 1996-SIC 3572)

Explanation: The bundling of Iomega's product with that of the PC differentiates the product from other products like it by giving Iomega the implied endorsement of the PC manufacturer.

Example 2:

IBM no longer relies simply on giving dealers discounts. Instead, it sometimes pays for special promotions. (Year 1989-SIC 5731)

Explanation: This innovation helps the channel customer create awareness in his own market.

Example 3:

Acura dealers in Japan are facing brand identity problems. There, the Legend is sometimes sold side-by-side with low-priced Civics, blurring the luxury image Honda is trying to create. In the U.S., Acura dealers are separate from Honda dealers. (Year 1986-SIC 3711)

Explanation: The addition of an entirely separate dealer network for Acura dealers helps to differentiate that channel from other channel suppliers.