Raise Price to Improve Revenues and Margins
CHOICE 2: ISOLATE THE SEGMENTS WHO MUST PAY THE PRICE INCREASE
C. Segments of customers where competitors cannot counter the company's change in Value
Customer segments who require a specific product system component
| No. | SIC | Year | Notes |
| 1 | 3579 | 2003 | Replacement cartridges for the Dell machine cost $29.95 for black ink and $34.95 for color ink. Cartridges for the comparable HP machines start at $17.99 for black ink and $21.99 for color. |
| 2 | 4481 | 2009 | Inclusiveness. It's the fundamental idea behind why a cruise is a good value: Everything (lodging, meals, entertainment) is included in the fare. The concept has taken a beating over the years, however, eroding under relentlessly rising costs and fierce competition among cruise lines to keep the advertised price low. Almost every consumable liquid is extra. Light drinker? One bottled water, one cocktail and one glass of wine per day adds about $120 per person (with service fee) to the final bill. |
| 3 | 5961 | 2008 | Airlines have long known that business travelers will pay higher fares in return for maximum booking flexibility, and that leisure travelers are willing to give up some flexibility in order to pay less. The lesson for e-tailers: They, too, can reap rewards from managing demand—in their case, by segmenting customers according to how they want their goods delivered. People who shop online can differ greatly in what they're willing to pay for delivery, and how flexible they can be on the time and date, when they have to be home to receive the package. If e-tailers adjust their fees and delivery options accordingly, they can not only increase revenue but also efficiency. The more delivery time slots one can choose from, the more attractive the service is for the customer, potentially increasing sales. The most obvious tool for segmenting customers is the delivery fee. Discounts should be offered for less-desirable slots to smooth demand. Prices can also vary based on the width of the time slot (hours during which the recipient can receive the shipment), with bigger discounts for wider time slots. |
| 4 | 6211 | 2002 | Next month, Charles Schwab will boost more than a dozen investor charges. Most of the higher fees are for services that require dealing with an actual person instead of a computer. |
| 5 | 7375 | 2006 | A handful of start-up companies, including Jingle Networks, has begun offering free directory assistance over the phone in return for the customer's willingness to listen to an ad. The free directory is appealing to more customers since traditional phone companies have raised the rates of their services over the past several years. Carriers can charge an average of $1.50 per 411 call on cell phones and $1.15 per call from fixed-line phones. |
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