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maryam@impact
[email protected]
2/26/2018 | 11:52:45 AM
Pricing clarity
Its a very interesting strategy for businesses but it most likely makes profit margins very different. For many companies, the product bundle is a specific methodolgy to achieve certain margins on products especially those becoming commoditized, it makes price comparision less black and white.This model seems to lay bear all that is involved in pricing and usage. I am interested to see if it will fuel price battles when the business consumer is armed with their usage data and cost profile.
Ariella
Ariella
2/26/2018 | 12:40:49 PM
Re: Pricing clarity
@Maryam Yes, I think it will take some people some time to wrap their head around this new paradigm. But if you think about the flexible options currently in use for busiensses -- including renting temporary offices rather than committing to spaces long term - - it is a sign of the times.
kq4ym
kq4ym
2/26/2018 | 12:52:42 PM
Re: Pricing clarity
Seeing how it's "almost like buying a gift card," it reminded me that merchants make a nice profit from using the float on those cards, receiving the money often a long time before the card is used, while expecting that a great number of the cards don't get used at all. I wonder if that might be a part of the profit plan at SAP for the newly offered cloud plans.
Ariella
Ariella
2/26/2018 | 1:12:25 PM
Re: Pricing clarity
@kq4ym On top of that, a number of gift cards are never cashed in at all. I know we've received some that we could never use. Then there are the cards purchased from stores that go out of business, so those cards are then worhtless. 
kq4ym
kq4ym
2/27/2018 | 11:47:48 AM
Re: Pricing clarity
Yes, I have several cards that have not been used at call or rarely. Buying credits or gift cards seems convenient, but as the retailers have seen, they are definintely a profit center gambling that the card buyers won't fully use those credits.
Michelle
Michelle
2/27/2018 | 7:56:16 PM
Re: Pricing clarity
There are some that take back your balance as a "service fee" for inactivity. Those are the worst gift cards!
Ariella
Ariella
2/27/2018 | 8:04:15 PM
Re: Pricing clarity
@Michelle yes, you can lose 10% or more of the value as time goes on with those. It's because of things like that plus the fact that not everyone favors the same stores that I don't like to offer giftcards. It's better to just give money outright because it has no restrictions.
Susan Fourtané
Susan Fourtané
2/28/2018 | 4:10:12 AM
Re: Pricing clarity
It’s the gift card culture. You find it everywhere and of course companies get more than what they give out of them. Otherwise, they won’t do it. There is not such a thing as “gift” or “free.” Everything comes with a price.
maryam@impact
[email protected]
2/28/2018 | 4:02:54 PM
Re: Pricing clarity
It may sound better than it is retailers still have to account for those unused Giftcards on their books as a liability. I recently had a gift card that a was a merchandise credit that I hadn't used in a long time the retailer called an asked if I lost the card and needed a new one. I got a new one and will use it but their accounting company was definitely on it.
Joe Stanganelli
Joe Stanganelli
2/28/2018 | 9:58:13 PM
Re: Pricing clarity
@Maryam: Indeed, that's why a lot of companies allow debits like that to go the state as a matter of unclaimed property rather than chase someone down to accept it. Easier, compliance-wise, in a way.
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