Article at a glance:

Fighting cannibalization

• When a company sells products that compete with one another, lower-priced offers may cannibalize sales of premium ones.
• New budget-priced offers from a subscription media company, for example, began eating into sales of its main brand.
• Customer relationship data revealed the extent of the problem but not what the company should do about it.
• By applying optimization techniques commonly used to plan operations, managers determined how much effort should be devoted to each of these products in order to meet the company's short- and long-term goals.