Reduce Price to Improve Revenues and Margins

CHOICE 1 OBJECTIVE: REWARD CUSTOMERS

CHOICE 2 ISOLATE SEGMENTS: CUSTOMER COST SAVING SEGMENT

CHOICE 3 COMPONENT: CHANGE THE LIST PRICE

No.	SIC	Year	Notes
1	0	2007	Some manufacturers offer discounts for customers who order over the Internet or an intranet system.
2	2300	2009	The recession is testing the relationship between retailers and apparel suppliers as vendors seek better deals despite retailers suffering from the downturn. Regional chain Bon-Ton Stores Inc. is among retailers that have begun offering early payments to certain vendors in return for discounts on their merchandise. "We want them to succeed and they want us to succeed," said Bon-Ton's vice president of investor relations.
3	2389	1990	Claiborne announced it will give a 10% discount to retailers that pay for their merchandise within 10 days of getting it. The discount affects 70% of Claiborne's business. The difference in pricing is that, for a short time (10 days after receipt of product), there's a discount.
4	2854	2005	Express Scripts has taken Lipitor off its preferred list in order to push clients toward the generic Zocor. Switching patients from Lipitor to Zocor will help Scripts and its clients save money. Express Scripts says it will try “therapeutic substitution” on patients in an attempt to get them to switch brands. Even though therapeutic substitution has never been effective before, there's never been another drug class where benefit managers have had more incentive to try. Some 80% of Express Scripts' patients take low-dosage Lipitor, which is no stronger than Zocor. The remaining 20% can take Crestor, made by AstraZeneca, or Vytorin, made through a partnership between Merch and Schering-Plough.
5	3572	1993	Conner cut prices for distributors and began selling direct to computer makers; competitors matched prices.
6	3651	2005	Dell's low cost structure, peerless supply chain, and direct-sales model let it drastically undercut rivals' prices. It recently introduced high-definition 42-inch plasma sets for less than $3,000, with incentives, while Sony and others were selling similar models for more than $4,000. In a matter of months, Dell seized 10% of this important slice of the plasma market in the U.S.
7	4213	1998	Yellow's YES program gave customers 3 to 20% discounts for consolidating their own shipments.
8	4300	1992	The post office offers presort discounts to businesses. They must have bundles of at least 10 pieces going to a five-digit zip code and at least 125 pieces in total to make up a bag. Or, you can qualify for 3-digit presort discounts with bundles of 10 to each post office. You get the discount if you eliminate the need for the Post Office's option of extra sorting attention. (Get the discount by saving the supplier some work.)
9	4311	1992	The post office discounts 1.4 cents per piece of first-class mail (27.6 cents per piece instead of 29 cents) if you automate your first-class mail. Your mailing must have pieces no larger than letter size, pieces can't be more than 1/4 of an inch thick and they can't weigh more than 2 1/2 oz. The mailing must include at least 500 pieces and they must have ZIP+4 in the addresses. You must have a volume of at least 500 pieces. You get the discount if you eliminate the need for the Post Office's option of extra sorting attention. (Get the discount by saving the supplier some work.)
10	4911	1995	Although the national price of power now averages 7 cents per kilowatt-hour, the span of pricing is great: Some big corporate customers may pay less than 2 cents, while everyday, home consumers can shell out more than 16 cents on a hot day.
11	5600	2003	Clothing chains have been doling out special "friends and family" holiday discount codes for as much as 25% off at the stores' Web site. The Banana Republic deals are intended for staffers and their loved ones. But with the codes being circulated by e-mail, the discounts are spreading fast. Stores are all too happy to have the discounts spread. It increases store loyalty and sparks sales.
12	5942	1999	In some of its mall stores, Borders has installed in store kiosks called Title Sleuths that bring the advantage of huge inventory to the store. Borders books online are generally cheaper than those on shelves because of the company’s need to price to compete with Amazon rather than with the bookstore across the street. This may create conflict.
13	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.
14	6321	2005	State Farm Insurance recently heard from its online community how unpopular its plan was to offer reduced rates for safe drivers willing to drive with "black boxes" (which would monitor how and when they drove).
15	6331	1997	Chubb Group is offering a separate vacation home policy that can lower premium costs. It adjusts for differences in the way people use their first & second houses.
16	7372	1992	Lotus software that lists for $495, can be purchased for $339 by mail, and big companies pay $307, or $250 in lots over 100.
17	7375	1999	If you order your Micron Internet service package online, you receive a lower price.
18	7996	2004	Amusement parks say they are particularly eager to encourage online ticket sales because it speeds up the lines and eliminates congestion at park entrances. Both Six Flags and Paramount Parks this year are offering lower prices to people who book online.
19	8011	1998	North American Care serves as a middleman between patients and some 400 health-care providers who are willing to cut their rates for cash upfront. Discounts range between 20% and 70% off a provider's normal charges.
20	8062	2009	Rising health care costs, especially in the share paid by the patient, are making more patients try to bargain down prices. In 2008, families paid an average of $3,350 on copays, coinsurance, premiums, and deductibles. That's twice the average of a decade ago. Working out a deal in advance makes sense if you plan on paying directly. One lady cut a deal with her gastroenterologist to pay $35 for an office visit, compared with $150 for a typical patient. For an examination of her lower intestines she pays $400 rather than $750 (or $1,500 at a hospital). Her doctor agreed to the lower fees because she pays promptly and fills out her paperwork ahead of time.

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