Reduce Price to Improve Revenues and Margins
CHOICE 1 OBJECTIVE: ATTRACT CUSTOMERS
CHOICE 2 SEGMENTS: TARGETED COMPETITOR SEGMENT / STANDARD LEADER PRICE AGAINST A NEW ENTRY
CHOICE 3 COMPONENT: PROVIDE A FREE, OR HEAVILY DISCOUNTED PRODUCT, FROM THE COMPANY, OTHER THAN THE PRODUCT ON SALE
| No. | SIC | Year | Notes |
| 1 | 7372 | 1995 | An effective neutralization strategy is to give away the benefits offered by a challenger for free. When Microsoft developed the Internet Explorer browser in 1995, for instance, users got it as part of Windows at no extra charge. |
| 2 | 7372 | 2005 | Netscape's browser, which cost each user $39.95, would enable applications like word processors and spreadsheets to reside on centralized internet servers rather than on the hard drives of users' desktops. That in turn would lessen their need for Windows or Office, sapping Microsoft's business. But the CEO rallied Microsoft to develop its own browser, which it then bundled free with Windows. Netscape's market share collapsed. |
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