Reduce Price to Improve Revenues and Margins

CHOICE 1 OBJECTIVE: ATTRACT CUSTOMERS

CHOICE 2 ISOLATE SEGMENTS: TARGETED COMPETITOR SEGMENT

CHOICE 3 COMPONENT: CHANGE THE LIST PRICE

No.	SIC	Year	Notes
1	2096	1998	The manager has a clear idea how Frito-Lay has tried to trap Eagle, and he says his competitor's strategy has been brilliant. "I would do it, too, in their place," he said. "We are primarily a supermarket company," Poldoian said, "and we are primarily a supermarket company," Poldoian said, "and we are primarily a potato chip, tortilla chip and pretzel company. They have systematically drained the profit out of those businesses."
2	2111	1989	P-M, is doing everything it can to take advantage of the management changes and debt from the KKR RJR buyout of 1989 –attacking in new product categories w/lower prices and an increased sales force.
3	2751	1996	Quad continues to invest aggressively and then wins volume on price. Quad offered Chicago Tribune a savings of $3 million on its retail inserts. Quad had a 96 inch press compared to the 70 inch press run by RRD. In response, RRD cut price by $2.5 million, keeping .5 million premium, and was able to keep the business. Then Quad went to other major customers, including Lands End, Spiegel and Modern Maturity. This gave RRD the reputation that they were hurting their customers by keeping prices high. In each case, RRD responded by reducing prices and keeping the customers, but at lower margins.
4	3290	1997	In early 97, Owens-Corning and Johns-Manville would go to major contractor accounts and offer to "sell at Certainteed less 12%". Posed a dilemma for Certainteed. In May, Certainteed began across-the-board reductions in that sector. All three took 10% price reductions.
5	3571	2004	Hewlett-Packard is taking on Dell for the No. 1 spot in the personal computer industry. Their new strategy is to sell PCs without worrying about profits. They push high-margin peripherals, consulting and consumer electronics. After acquiring Compaq in 2002, H-P can cut prices further because of its massive size. The cost-cutting tactics are ideal for consumers as prices on desktops and laptops continue to fall. H-P offers a broader line of goods and services than Dell, leaving it with more leeway in profit margins. The size also allows the company additional clout when negotiating with contract manufacturers.
6	3674	2000	Intel is using its price cuts to boost demand for personal computers and to win back some customers who turned to AMD when supply was tight. These price cuts come after a year of gentlemenly conduct between the two companies on prices.
7	3711	1990	Last month, GM and Ford introduced models similar to the Jeep Cherokee that sell for about $2000-$4000 less.
8	3861	1995	Kodak announced that under a co-branding agreement, some retailers in Japan will sell its film for half the Japanese retail price. This move was directly aimed at intensifying Kodak's war with rival Fuji, which controls 70% of the Japanese market.
9	4700	2003	The Web may heighten competition in other ways. Smaller hotels in the same city may steal business from big convention hotels by offering cheaper online room rates to coincide with a rival's event.
10	4813	2001	Sprint is taking steps to spur Web demand, as it lowered the per-month service fee to $5 from $10.
11	5211	1997	Menard undercuts Home Depot on price. It may only be by a penny or two, but Menard is broadcasting the message that they won't be undersold.
12	5331	1993	When Walmart entered the Atlanta market where KMart (Pace) was already competing, Sam's led price cutting for as long as was necessary (profit margings dropped from 9% to 6%) to drive Pace out of business.
13	5411	2006	Wal-Mart's largest non-American operation, Asda, has been struggling recently as its top local rival, Tesco PLC, is thriving. Tesco has used its knowledge of shoppers to fight Wal-Mart's core appeal: low prices. After Wal-Mart bought Asda, Tesco searched its database and singled out shoppers who buy the cheapest available item, and would most likely be tempted by Asda. Tesco then identified 300 items that these price-sensitive shoppers bought regularly. One was Tesco Value Brand Margarine. Tesco lowered the price of the margarine, along with other products with similar profiles. As a result, shoppers didn't defect to Asda. In fact, Tesco's sales jumped 17% to $79 billion in the year ended Feb. 25, and net income rose 17% to $2.96 billion.
14	5651	2006	Steve & Barry's University Sportswear lures shoppers with casual clothing priced $7.98 or less – a 40% discount to prices at Wal-Mart Stores Inc. and Target Corp. The chain cuts expenses further by deft navigation of import quotas and duties. That's why it buys more from factories in Africa and less from China than many rivals – most African countries face neither U.S. quota nor duties.
15	5735	2004	Companies are experimenting with ways of distributing and selling music that, over time, are headed for the mainstream. Right now, the pricing at the nearly dozen major services, from Apple to Dell, is identical at 99 cents a song and $9.99 an album. But Wal-Mart is testing 88 cent downloads.
16	5812	1996	Jollibee's prices are 5-10% lower than McDonald's.
17	5942	2002	Amazon competitors have resumed discounting, too. Closely held Buy.com Inc. offers free shipping on most products with a minimum order size and promises to undercut Amazon book prices by 10%.
18	6021	1987	Citicorp is launching a service that will allow customers to wire funds nationwide at a cost 20% less than what Western Union does.
19	7200	2002	The race to enroll broadband users has heated up. MSN and Yahoo have just struck deals with DSL operators Verizon Communications and SBC Communications to be their preferred online services – at prices as much as 20% below AOL's. Rivals are also beefing up features.
20	7372	1995	Lotus Notes (with program development features) priced 16% under previous price ($275 v $330) in order to gain market share before Microsoft introduces its competing software, Microsoft Exchange.

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