US drivers now get half price parking in Manhattan if they drive a half size car. This latest innovation got me thinking. Once the preserve of Utilities, "pay for what you use" is seeping into other markets where an otherwise high cost can be more palatably priced. It's certainly something to consider afresh in your market as people look to cut back in whatever ways they can. Other products successfully targeted at drivers in recent years have been the "pay-per-mile" insurance policy and the "pay-per-hour" car rental clubs like London's Streetcar. But you can also pay-per-view films, pay-per-chapter for books, and per-song on iTunes, where once you had to buy the artist's whole album. And pay-as-you-go has made mobiles accessible to a much broader user base by including a younger age group where contract probably wouldn't have been a viable option. What unit is used to price up your product offering? Could you change the unit to offer better value and retain customers through the credit crunch? For example, car parking has always been priced in units of time for use of a standard-sized space, and the success of mini-car sector means car parking space can now be priced in units of time and space taken. Have a go, see what you come up with.
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Another category where this "pay for what you use" has been introduced is airlines. 'Easy Jet' is one of the most valuable example; they simply make you pay for your luggage unless this is an hold bag of less than 20kg... The problem arises when people (particularly in the US) are tempted to apply this to Human being: the airline should charge you more if you weight more. This makes me think as well ...... Besides the ethical question, some insurance companies have already introduced this scheme in their offers.
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