PRICE DISCRIMINATION
It is defined as charging different price to different
people at different time is called price discrimination.
It allows the company to earn higher profit than standard
pricing,it requires market segmentation.
COMMON EXAMPLE OF PRICE DISCRIMINATION.
1.AIR TRAVEL
INDUSTRY.
Customer booking
early ticket,get the benefit of price discount.this give the airline the
advantage of knowing how full the flight
are likely to and source of cash-flow in week and month prior to the
service being provided.
2. Segmentation By Group and Student
Status.
Many amusement
park,tourist attraction ,and other place have different admission price per
market segment:for child it is fixed ranging from age to age, for younger the
price is charged differently. Senior citizens have much less
income.examp.zoo,muisium .
3.INTERNATIONAL
PRICE DISCRIMINATION.
SOME PHARMACEUTICAL COMPANIES MAY CHARGE CUSTOMER LIVING IN
WEALTHIER COUNTRIES ex. United state much higher price for identical drugs than
in poorer nation like Africa,African consumer are much lower, sales would be
extremely limited without price discrimination.
4. DUAL PRICING.
even within
a country , differentiated price may be
established to ensure that citizen receive lower price than non-citizen-this is
called dual pricing. Many countries maintain separate admission charges for
museum,national park.
Many
publicaly run universities in several countaries are subsidized by taxpayers of
the state for theit own citizen,while outsider pay higher tuition fees.
5. WAGE DISCRIMINATION.
Wage discrimination is prevailed when the pricing of
equivalent labor is discriminated among different group of the workers. For
exam.in several developing countries women earn lower wages
Relative to male for similar kind of work.
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