I constantly amazes me what the mark up is on certain products and services, and how much money you can save by remembering that Everything Is Negotiable! I’ve saved little bits of money on monthly services such as my phone, internet, and television costs before, but my most recent frugal adventure came courtesy of my new satellite radio.

Wouldn’t You Save Money Just By Not Having It?

Now many would argue that the whole idea of buying satellite radio is not frugal at all, with all those free radio channels out there just waiting to be picked up it’s hard to justify spending money in order to get access to a few niche stations. It’s pretty likely that I never would have looked into getting a satellite radio at all, but I got three months of free service when I bought my new car back in July. I was very skeptical initially, but on several long commutes to my university over the summer I became hooked on listening to the sports shows I was missing, and the constant sources of news appealed to my addiction for knowing what it going on in the world. Long story short, I was “on the fence” about paying for a subscription when my three months was up, and then I got an offer in my inbox that said I could get 3 more months for $5.99 a month. I decided this would be a great extension of the trial period and subsequently purchased 3 months.

The Magic of Google

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My girlfriend said she would buy me a year’s subscription for Christmas if I wanted it. The great news is that I love the satellite radio, the bad news is that the Sirius/XM crew’s marketing scheme has worked perfectly. I would now have a difficult time going back to regular radio (especially considering we only get 5 stations in the rural area I live in). I said sure, and looked up the price to order it. Before doing so, I did my usual “30 seconds of online frugality” and Googled “promotional code Sirius/XM subscription.” For the next 5 minutes I read several user accounts of people who had simply called into Sirius and gotten substantial discounts to the tune of 60% off! This sounded crazy at first, but it seemed to be fairly well established, so I thought why not give it a try?

I quickly called the toll free number and the options menu was actually much shorter than most, and my wait time was almost non-existent. Here is how the conversation went verbatim (feel free to adapt this for your negotiating purposes):

My Sirius XM Discount Story

Jenna (Sirius/XM propaganda merchant): Hello, welcome to Sirus/XM, Jenna speaking, how many I help you?

Me: Hi Jenna, my name is _______ and I looking to renew my XM subscription for one year. I had decided that I wasn’t going to be able to afford the expense going into 2013, but my friend recently told me that he got a year’s worth of programming for $77. At that price it would make a lot more financial sense for me to renew with XM.

Jenna: Ah…. I’m sorry sir, I’m not sure what promotion you are speaking of.

Me: Jenna, my friend down in the USA said that I could get a subscription for $77 per year, I pretty much need to get this rate or I will have to consider cancelling my subscription for economic reasons.

Jenna: Ah, I’m sorry sir, that is an American promotion that we cannot match. We have no promotion like that at this time.

Me: Ok Jenna, is there no way to match the American promotion?

Jenna: No, sorry sir, we can’t offer you any discount at this time, our fee is $165 dollars a year.

Me: I’m sorry to hear that Jenna, that really leaves me with no choice but to cancel my Sirius/XM subscription due to economic circumstances. Thanks for your time.

Jenna: Oh sir, did you say you were going to cancel your subscription today?

Me: Yes Jenna, I cannot afford the rate you told me so I will have to immediately cancel my subscription.

Jenna: Oh no sir, please stay on the line and I will transfer to my manager.

Me: Ok, thanks Jenna.

*BINGO* I thought. I proceed to stay on the line for 5 minutes or so, and then Janet picks up the phone. In the interests of brevity I’ll summarize and say we introduce ourselves and I relay my story about the deal “my buddy” got in the USA and my financial situation. I reiterated that in doing my budget for the New Year I just couldn’t squeeze in $165 plus taxes for Sirius/XM radio. Here is how the conversation went from there:

Janet (very important upper-management person): Ok sir, we cannot offer you that promotion because that is an American promotion not available to us.

Me: Are there any Canadian promotions you can offer me Janet?

Janet: Well, let me see… *fingers tapping on keyboard* right now you are on our promotional $5.99 per month package, would you be interested in extending this for 6 months sir?

*Doing mental math quickly in my head 6×6=36, 6×12=72*

Me: Yes, that is a good offer Janet, do you think we could extend that promotion to me for 12 months and I’ll hand over my credit card number right away. *trying not to sound too excited*

Janet: I’ll check with my manager on this sir [at this point I’m either having my request considered by the regional manager for the Western Hemisphere or Janet is discussing her dinner plans with the person beside her]… “Yes <insert my name here> we can do this for you.”

Me: Ok, here it is…

Janet: Thank you sir.

Me: Just to double check then, that will be a $72, plus taxes charge to my credit card for a year’s worth of the same programming as I have now, correct?

Janet: *long pause as it sinks in she just gave me a bigger discount that I originally requested* Yes, sir that is correct.

Me: Thanks Janet, have a great day!

Janet: You as well sir, happy holidays.

I Love Being Irrationally Happy!

Now I don’t know why this made me so happy. When you add in the difference in taxes here I probably saved about $100 bucks. While this is substantial, I’ve earned much more than this several times and not felt the same sense of satisfaction. Even if you consider that saving that much money was like earning $150 in pre-tax income, it still gave me a disproportionately great feeling! I guess I underestimated the psychological high of getting a good deal.

Discriminatory Pricing

I guess the moral of the story is that everything is negotiable and to be aware of discriminatory pricing. Satellite radio has the perfect business model to take advantage of discriminatory pricing. Their capital costs are pretty set, and it costs them literally nothing to add a new subscriber; therefore, their pricing model is setup to take advantage of what people think they should pay for a service. In other words, through market research, Sirius/XM has obviously found out that $165 is what most people value their satellite radio service at, and this is what they’re willing to pay. Obviously, they still make more of a profit off of me as a consumer at a much lower rate than if I cancelled the subscription entirely. I started off hoping for a 20% discount and ended up with one that is over 60% when you include taxes! It only took me about 20 minutes start-to-finish (that’s a $300 per hour rate, not too shabby for a school teacher), and was way less trouble than coupon clipping.

Anyone else have a sweet sirius xm discount story that was a really pleasant surprise at the time?

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