Re: Tierred pricing (was Tiger tools...)

On Tuesday 30 October 2001 11:25 am, rob@dekko.com wrote:
> But if they need to gouge the larger machines in order to subsidize the
> smaller customers then they must be losing money on the smaller customers.
> If so, then why market to them at all?

That is pretty much their decision, isn't it? I worked for a company that
felt they should only target their sales efforts to companies doing $20
million annual revenue or greater. But they often got inquiries from smaller
companies for their software. So, they put together a package targetted at
the smaller platforms that they did not include as much customization and
support with. Their software package itself used tier pricing.

But, the company would have prefered to not sell to smaller companies at all.
Their discounting and modifying of their offering was simply an attempt to
turn interest into income.

Companies are probably in business to make money. If they are price gouging,
then they must be raking in bucks hand over fist, right? But I don't see a
lot of that happening right now.

So the question in turn is, if the small customer is being ripped off by the
tier pricing, why are they buying the product?

If the vendor says they don't want to bother with your company unless you are
spending $250,000 then maybe they are telling you something about what sort
of internal costs they see with supporting their customer base.

_Of_Course_ there are people who will find some pricing structure doesn't fit
their business useage. That doesn't mean the vendor was just trying to rip
them off.

> Rob Berendt

--
Chris Rehm
javadisciple@earthlink.net

And thou shalt love the Lord thy God with all thy heart...
...Thou shalt love thy neighbor as thyself. There is none other
commandment greater than these. Mark 12:30-31