Intel’s famous pricing strategy in the 1970s is a good example of a bold strategic move. At the time Intel understood there was a strong reduction in their own costs as they scaled unit sales. Dropping unit sales would lead to increased demand and volume, causing a virtuous cycle. Intel smartly decided to launch a new silicon product at cost below their COGs in order to scale market share faster. In response, their customers bought in volumes they had not projected until two years out, causing a massively lower cost structure for them and therefore profitability. In other words, their low
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