Reduce Price to Improve Revenues and Margins


1. Attract Customers

Attract customers of a vulnerable competitor

No. SIC Year Notes
1 2111 1993 Brown & Williamson responded to Brooke's price cuts by coming out with its own generic brand and offering wholesalers steeper volume-based rebates than Brooke had.
2 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.
3 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.
4 5411 1999 Save-A-Lot is a smaller assortment grocery subsidiary of SuperValu (based in Minneapolis). The strategy is to have the prices constantly be lower than the super centers. A gallon of milk at Save-A-Lot is $1.99 vs. $2.19 at Wal-Mart.
5 7375 2005 SBC Communications, which kicked off a boom in discounting among its competitors, upped the ante by offering free Internet for three months to cable broadband subscribers who switched from competitors.

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