Reduce Price to Improve Revenues and Margins

CHOICE 3: USE COMPONENTS OF PRICE TO FURTHER LIMIT THE SPREAD OF THE LOWER PRICE

D. Change the Optional Components of Price

No.	SIC	Year	Notes
1	4724	1987	Competitors are trying to wrest agencies away from American's Sabre, even offering to pay their legal fees if American sues to enforce its contracts.
2	6211	2005	Mutual funds have begun tying fees to performance, intending to align the interests of managers with those of shareholders. The funds often deliver better risk-adjusted returns although they may be riskier as a result. Janus Capital Group implemented performance-based management fees on 13 of its 59 funds.
3	7300	2009	Geary Interactive Inc. reduced its hourly fees to $80 from $100 to $135 in response to customers desires for lower rates. However, Geary added a contractual bonus to be paid at the end of a certain time period if its marketing campaigns met or exceeded a client's goals. The move also meant a shift for staff often accustomed to thinking about loner-term goals such as brand development; now, there is a higher sense of urgency.
4	8011	1997	It is the company's intention to contract for risk with payors. Phymatrix receives a management fee, approximating 3%-6%, for services provided, as well as 25%-50% of any hospital risk pool.
5	8742	2004	To help make hiring Accenture “not optional,” it is implementing several changes at the consulting giant. It is championing a new strategy it calls “high-performance business.” The idea is that Accenture will use its business and tech know-how to help clients become superstars. Under a contract with British travel company Thomas Cook, Accenture's bonus depends on reaching five metrics, including cost-cutting targets. Today, 30% of Accenture's contracts include quantitative measures – and the number is growing.

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