Reduce Price to Improve Revenues and Margins

CHOICE 1 OBJECTIVE: ATTRACT CUSTOMERS

CHOICE 2 SEGMENTS: PERFORMANCE PERCEPTION SEGMENT / A BRAND WITH PERFORMANCE (I.E., FUNCTION, RELIABILITY AND CONVENIENCE) AT THE LOWER END OF THE BRAND CATEGORY

CHOICE 3 COMPONENT: CHANGE FUNCTION AND PRICE TOGETHER

No.	SIC	Year	Notes
1	4512	2004	Independence Air, United's regional affiliate, will become an independent low-fare carrier in June from Washington's Dulles Airport. Formerly known as Atlantic Coast Airlines, the carrier aims to serve 35 cities by summer's end. The startup airline plans to offer many more daily flights on most of the routes and mark their fares lower than those offered by United. Independence Air will expand its network to south Florida and the West Coast after it integrates 27 larger Airbus jets into its fleet by 2006. No low-cost airline ever has built itself on a foundation of regional jets, which have higher unit costs than big jets, but Independence Air believes it can lower its costs by flying its planes more hours per day, being more efficient in its use of airport gates and staff, using self-service check-in technology, and selling the bulk of its tickets on its own Web site, Flyi.com.
2	4841	2003	SBC Communications cut its lowest broadband price 10%, far below the average of about $45 per month charged by cable companies. SBC and other phone companies are still playing catch-up with the cable guys, who control about 2/3 of the market for high-speed Internet. Phone companies are turning to price cutting to close the gap. For now, cable companies are mostly holding prices steady and instead are competing by offering ever-faster service. That could lead to a two-tiered consumer broadband market. Phone companies could wind up charging lower rates to people who use the Internet mostly for browsing and e-mail, while cable companies take the high-end customers who will pay more for quicker downloading of streaming video and other applications.
3	5600	1988	Dress Barn offers quality labeled fashions at a 20-50% discount from department store prices.
4	7372	2005	Electronic Arts Inc. and Take-Two Interactive Software Inc. are battling over sports rights in the video game world. Take-Two cut a deal to market an underperforming series of sports video games named after ESPN, the sports channel. Then it jolted the game world by setting a price of just $20, less than half the going rate. It was a direct challenge to Electronic Arts Inc., the biggest videogame maker, for whom sports is a crucial franchise.

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