Productivity Clumps: Arnie Street's Variable Pricing Model and Design as Competitive Advantage

The start of hopefully, a useful series. My way of justifying the time I spend on my blog and your time reading it (the rants are a bonus!) - culling business ideas from 'round the web:

• Arnie Street has a variable pricing model that Armando Roggio from Practical Ecommerce believes could apply to other ecommerce businesses and has been core to its success. Prices start free, and rise up to 98 cents based on popularity - prices therefore are a signal of popularity of a particular song allowing you to discover new bands. Roggio says the model has three principles that allows it to work:
  
  1. There's a scalable and low-wholesale cost item
  2. Uses a very low introductory price to entice prospective customers, and
     
  3. it rewards customers for marketing for the store.
     
     
• Using design as a competitive advantage is obviously not a new idea (see Apple). One trend that I think will pick up pace is the simplification and stripping of features people neither want nor use. The Industry Standard asks whether the acquisition of Flip by Cisco heralds the rise of "dumb tech"? I think it goes further than this, in that one of the drivers is building designs for "the bottom of the pyramid" (Amazon).
  
  Making products affordable used to be about sending last year's models and rejects into the developing world, but I think there's a real recognition (in no small part motivated by competition based in the developing world), that the market potential is not only greater but now it seems things are reversing: basic concepts are being designed for the developing world to be scaled up for wealthier markets (Core77).
  
  
• Finally, a trend in manufacturing. The blog at Shapeways talks a bit about the barriers to mass customization when it comes to 3D printing as an emerging technology. It makes the argument that desktop 3D printing will never become mainstream for the simple reason that it will be easier and more cost effective to manufacture in mass quantities - comparing the technology to the less than universal nature of a Singer sewing machine. I don't entirely agree with their reasoning but I think their discussion of what the key barriers are, is interesting.