Reduce Price to Improve Revenues and Margins
CHOICE 1 OBJECTIVE: REWARD CUSTOMERS
CHOICE 2 ISOLATE SEGMENTS: COMPANY REVENUE IMPROVEMENT SEGMENT
CHOICE 3 COMPONENT: CHANGE THE LIST PRICE
| No. | SIC | Year | Notes |
| 1 | 2834 | 1993 | Bristol-Myers will offer American Healthcare Systems significant discounts in return for a preferred status role (hospitals under American Healthcare Systems will be obligated to buy from Bristol-Myers). The relationship is under a 5-year contract. |
| 2 | 3576 | 2001 | Cisco sells products two ways: directly to big customers and indirectly through distributors. The gear is sold to distributors at from 38% to 42% off the list price, depending on how much they buy. Those distributors tack on an extra 10% when they sell to others. So the final customer may pay 30% to 35% under list for new gear. |
| 3 | 4512 | 2005 | A side effect of the air line fare cuts is many big corporate level contracts, which funneled a certain volume of business to preferred carriers in exchange for discounts of 8% to 12% may become obsolete. This may allow business travelers to shop around more with low cost carriers, though many companies are already tapping into those savings. |
| 4 | 4813 | 1991 | MCI beefed up computer systems to permit innovative residential calling services, such as the new Friends & Family plan, which offers 20% discounts on calls to pre-selected parties. |
| 5 | 4813 | 1991 | MCI's Family and Friends rate offers a 20% discount to any 12 #s of the customer's choosing–if both sides have MCI. |
| 6 | 4813 | 1992 | AT&T will subtract 10% of its fee on frequently dialed int'l calls. The catch is that the numbers called must be AT&T long-distance customers as well. |
| 7 | 4813 | 1992 | MCI says Friends & Family customers call 25% more than they used to, at least initially, and are 20% less likely to drop MCI. |
| 8 | 4813 | 1993 | MCI's "Friends and Family" program offers discounts to groups of MCI customers who phone one another: very successful. MCI share of US market has expanded 14% to 17%, while AT&T's has contracted from 68% to 66%. MCI has a sophisticated billing system needed to link accounts of customers from all over the country: AT&T doesn't (makes Friends and Family possible). |
| 9 | 4813 | 1995 | New MCI Friends and Family offers 50% off when you call other MCI customers in your designated calling circle. |
| 10 | 4931 | 2000 | Essential.com offers to sell utilities at lower rates than can be generally found elsewhere by aggregating customers. New England Electric System sells electricity through Essential at 10% below competitors' prices. |
| 11 | 5912 | 2006 | Pharmacy-benefit managers pioneered the practice of offering patients incentives to bypass drugstores and deal directly with their own in-house mail-order pharmacies. They typically did this by offering mail-order customers discounts. In some cases, employers agreed to "mandatory mail" programs that required patients to use the PBM's mail-order pharmacies for their long-term medication. |
| 12 | 5999 | 1991 | When you make a purchase of $75 or more at The Sharper Image and charge it with the American Express Card, you receive 15% off. |
| 13 | 6141 | 1987 | Affinity credit cards offered through an agreement between card issuer and an organization that markets the card to its members. Interest charges for affinity cards ranged from 16.89% to 17.65% in mid-1987. Industry average: 17.24% to 17.98%. |
| 14 | 6162 | 1993 | Prudential Home Mortgage faces industry slowdown by moving to offering affinity programs. |
| 15 | 7372 | 1986 | Lotus reports that it is testing a site-licensing program with Exxon that doesn't involve copying. Microsoft soon will announce a "corporate licensing" plan under which big customers get a discount for guaranteeing a certain volume of business. |
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