Saturday, July 29, 2006

Life Under the Sloped Demand Curve

Three things you learn in basic econ:

1) It’s no surprise that everybody on the plane is paying a different price.

2) The last thing you want is a job where you get paid what you are worth.

3) We all want a hidy hole under a sloped demand curve.

So this account-- of how Cingular figures out when to hold and when to fold on customer switching-- is a kind of old news. But read it anyway, and then skim down to the comment from the guy at Technical Video Rentals and learn (in a bit more detail) how they do the same thing. And the final shockeroo: “Someone who's given us tons of business gets the kid glove treatment.”

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