Reduce Price to Improve Revenues and Margins
CHOICE 1 OBJECTIVE: ATTRACT CUSTOMERS
CHOICE 2 ISOLATE SEGMENTS: INTRODUCTORY OFFER SEGMENT
CHOICE 3 COMPONENT: CHANGE THE LIST PRICE
| No. | SIC | Year | Notes |
| 1 | 2082 | 1989 | Coors generally followed the price leadership of AB. When it was rolling out its products to new states in the 80's, it did price very aggressively to gain market acceptance. Coors was one of the two brewers that initiated the acceleration of price wars in 1988. Coors and Miller were able to maintain these discounts without AB joining in for a year and a half. During the first nine months of 1989, however, Coors shipments were up by less than a percent. |
| 2 | 2752 | 1989 | After the '87 crash, the industry will generate $550MM in revs., down from the pre-crash $850MM. Prices are down 25-50% as newcomer Donnelley(big in other mkts) has offered steep discounts and grown to 2nd. |
| 3 | 3354 | 1993 | Reynolds (new entrant) sold at prices that matched steel can makers'prices (Leaders), but were below its own costs. Reynolds was discounting by offering a superior product at the same price as the steel beverage cans. Reynolds gained share. |
| 4 | 3400 | 2002 | The company helps retailers manage the issue of sticker shock with "kickers," single items sold at sharp discounts meant to get shoppers to try the All-Clad line. A 7.5 inch frying pan and a 1 quart saucepan, which would retail for about $60 each, would be offered for about $20 each. |
| 5 | 3711 | 1990 | Hyundai had greatly underpriced its Excel to shoot itself into the US market. So it had very small profit margins. |
| 6 | 3731 | 1994 | US ship manufacturers are gaining contracts with aggressive low balling of bids. McDermott views one large contract as a loss leader to eventually gain more customers. Industry leader effect. Low ball bid tactics abound. |
| 7 | 4213 | 2003 | In order to attract business when Knight penetrates a new market, it charges rates at or below the market average. Once it gains credibility it raises rates at or above what the market charges. This has helped Knight gain a 25% annual sales growth for the past five years. |
| 8 | 4812 | 1999 | Globalstar is slated to start service in September. Teledesic, Lockhead Martin, and Boeing want to launch services. Rivals will offer cheaper packages than the $1,500 Iridium charges for phone gear and its $3-a-minute calls. |
| 9 | 4813 | 2004 | Customers need a broadband connection to get AT&T's service, but they will get unlimited local and long-distance calling for $19.99 a month for the first six months, rising to $39.99 a month thereafter. |
| 10 | 5200 | 1985 | Standard industry practice calls for a new store to offer as much as 20% off a competitor's prices for a limited time. |
| 11 | 5735 | 2004 | For an unspecified limited time, RealNetworks will cut the price of songs available on its Real Music Store to 49 cents per track, half the 99-cent per track price offered by Apple's far more popular iTunes Music Store. The Real Music Store is also slashing the price of albums by $5, to $4.99, also about half of what iTunes and other rival services charge. |
| 12 | 6141 | 2008 | In November, Chase rolled out a new Freedom card that may offer fewer cash-back bonus opportunities. Now, new customers will earn up to 3% cash back on gas, grocery and fast-food purchases for six months; after that, the rate will be 1% on all purchases. |
| 13 | 6300 | 2005 | Insureds who go out on the market usually get lower prices. This is because carriers give more price deviation authority to their underwriters on new business than they do on renewals. |
| 14 | 7372 | 1991 | When Electronic Arts introduced its first program for Nintendo, there was a software glut. CEO immediately cut prices from $50 to $35 and broke even when competitors took a bath. |
| 15 | 7372 | 2000 | In December 1999, Oracle software company cut prices to corporate customers by 40% to 50% for its new Internet database 8i, hoping to stimulate demand. |
| 16 | 7372 | 2009 | Microsoft's new Windows 7 PC operating system will go on sale in stores for $40 less than the $240 it charged when it launched its Vista program in 2007—the biggest price cut on a new version of Windows in years. |
| 17 | 8221 | 1996 | Many state schools are also cutting prices. Massachussets lowered tuition by 5% this year for its 24 schools; Virginia froze tuition at 39 schools through 1998; all 23 CA schools are holding payments at 94-95 levels. Others have limited increases to close the rate of inflation. |
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