Final Customer Purchasing from an Intermediary of the Product

Acquire Steps: Acquire steps include all activities the customer completes preceding the purchase of the product. These steps include the customer's efforts needed to identify and evaluate Intermediaries and travel to the Intermediary location.

Resources: Reduce resources required for the use of the product

Money: Reduce the money the customer uses with the product. For more ideas on using pricing, please see the Improve/Pricing section of StrategyStreet.

A. Reduce the level of payment for use of the product.

Warnings and advice

No. Year SIC Note
1 2003 2844 Estee Lauder purchased Jane cosmetics line, typically sold in drugstores and such retailers as Wal-Mart. However, Jane has performed poorly under Estee Lauder's struggle to grasp selling to mass merchants and the limited potential of such a narrowly aimed target market of young buyers.
2 2001 3571 Tech Data Corp has employed rigid cost controls to make a profit while rivals in the PC and peripheral market are losing money. The company calculates the cost of serving every customer. Tech Data focuses on corporations, smaller distributors and retailers. The company factors 150 costs, from average order size to freight costs to calculate gross expense on margins. If a customer is unprofitable, it will not hesitate to let them go. These measures have slashed expenses to 3.5% of sales, well below the 5% level of competitors such as Ingram Micro. The company is also expanding sales of higher-margin peripherals and rolling out an online sales program that links directly to Tech Data's inventory system. This speeds the processing and shipping time.
3 2004 4899 Wi-Fi hot spots–where people can pull an Internet connection out of thin air–are cropping up by the thousands, but it's not clear who's going to make money from them.
4 2002 5311 SuperTargets seem to be missing because they are located in more urban areas where expenses are higher and customers won't drive as far. And, where rival grocery stores are more entrenched. The Target grocery centers are also spread out geographically.
5 2003 5311 Discount apparel and houseware retailer TJX has won frugal customers from fancier department stores in the soft U.S. economy.
6 2004 5331 Wal-Mart has difficulty merchandising television sets and videogames properly because of crowded aisles and locked cabinets. At some Wal-Marts, customers buying 27-inch TVs were sent out to the parking lot to pick up their set from tractor trailers. And Wal-Mart's reliance on no-name and private-label electronics brands, which keeps prices low, is a strategy that backfires at Christmas.
7 2004 5331 Wal-Mart is easing up its iron grip. Not only is it lessening the pressure on its suppliers, it also appears to be less fixated on slashing its own retail prices for everything from blue jeans to DVDs. Wal-Mart says that it realized the relentless price-cutting is hurting it almost as much as its rivals. Moreover, the chain's lower prices didn't always create enough new volume to cover rising costs and stoke earnings. Wal-Mart knows that its suppliers need some relief.
8 2003 5399 According to a recent survey by New York-based WSL strategic Retail, 75% of consumers are shopping at dollar stores, half of them at least once a month.
9 2002 5999 The bargain sites are leading a trend, All U.S. e-tail sales from Nov. 1 through Dec. 3 rose more than 40% from the year-ago period to $7.2 billion, says Overstock says it sells most of its products at 60% below retail.
10 2000 8744 E-Stamp initially targeted small offices and home offices. But these customers purchase only about $10 of postage a month. Now E-Stamp is broadening its market to include small and midsize businesses.

<< Return to Acquire Steps