Reduce Price to Improve Revenues and Margins
CHOICE 1 OBJECTIVE: ATTRACT CUSTOMERS
CHOICE 2 SEGMENTS: LOSS LEADER SEGMENT / A LOW PRICED STAND-ALONE PRODUCT THAT IS LIKELY TO FORM PART OF A PRODUCT SYSTEM
CHOICE 3 COMPONENT: MAINTAIN THE PRODUCT
| No. | SIC | Year | Notes |
| 1 | 3500 | 2004 | PalmOne's Treo 600, which lists for $600, can be bought for as little as $330 with a service contract. "Demand is still ahead of supply, but we're catching up." |
| 2 | 3571 | 2004 | Dell, which sells directly to customers over the phone and Internet, has moderated its pricing in markets where it thought there was a risk of losing money. One such niche was low-end consumer PCs, where desktops have dropped to $299 and notebooks to $699. Dell has also cut the standard warranty of its lowest-priced consumer PC from one year to 90 days. Dell's rivals are much more constrained. HP needs consumer PC sales to drive sales of printers and ink cartridges. It dare not raise prices. Dell's fatter PC profits should give it room to keep the heat on HP in printers, servers, and storage gear. |
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