Category Archives: Price Discrimination

Why Should Walgreens Get Bad Rap For Good Pricing Differentiation?

Walgreens (at the corner of Happy & Healthy) can’t be too happy with headlines last week, when CNN Money, Time, Huffington Post, MSN.com and many others took Walgreens to task that customers might ...
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Setting Prices & Pricing Data Are Top Challenges Retailers Cite In RSR “Tough Love” Survey

Breathing down every retailer’s neck in 2013 is online retail competition growing by double-digits, eCommerce surging ahead of brick & mortar and becoming more effective; and the use of more effective tools for meeting and beating the competition. In my previous blog post on RSR’s Tough Love, An In-Depth Look At Retail Pricing Practices, I talked a...
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5 Valid Reasons For Retailers To Price Differentiate By Geography

A recent Wall Street Journal article, “Online Retailers Vary Prices Based on a User’s Location” (December 24, 2012) reported that several large retailers including Home Depot, Lowe’s, Rosetta Stone, and a renowned office-supply company varied their web-based pricing based largely on a customer’s location (a procedure called price differentiation). ...
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The Surprising Secret to Successful Price Segmentation

Guest blogger, pricing expert and author, Mark Stiving, wrote a great post for Upstream Commerce a few days ago on How to Get Your Customers to Like Price Segmentation. Mark highlighted how price segmentation can cause more trouble than it’s worth for retailers, and discussed ways to avoid the downsides while holding onto the additional profit. ...
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How To Get Your Customers To Like Price Segmentation

Can you charge individual customers different prices? Are you doing it? The secret is to do it in a way that they’ll like and appreciate. In 2000, Amazon.com famously did some price testing that caused customers to be quoted different prices for the same product — and got in trouble for it. Jeff Bezos, the CEO of Amazon, claimed it was “random pric...
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Why Pricing ‘Right’ Is Vital For Retailers Today

 In 2011, Retail Systems Research (RSR) managing partners Nikki Baird and Paula Rosenblum explored the impact of price transparency on retailers’ pricing strategies and tactics. According to the surve...
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How Retailers Can Gain Pricing Power Through Product & Service Differentiation

More on pricing strategy and value-added services: If you have no differentiation from the market, you are a commodity. When you’re a commodity, you have no pricing power. So unless you happen to have a sustainable, defensible cost advantage (hello, Southwest Airlines), you’re going to be in big trouble.

So what about competitive pricing? How ...
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Should Retailers Price for Loyalty or Price By Willingness to Pay? The Contradiction

When it comes to competitive pricing, value-based pricing maximizes your profits. At its simplest this means charge what your customers are willing to Pay (WTP). When you have the ability to charge different prices to different customers, charge more to the ones with higher WTP. We’ve discussed this as price segmentation in recent articles. What...
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Price Segmentation Yields More Profit At High End

Last month, we discussed price segmentation and how to charge different customers different prices based on customer characteristics, their behaviors, and transaction characteristics. These are all techniques on how to charge different prices for the same product. This month, let’s look at the most powerful price segmentation tool of all, your pr...
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Price Wars, Part 3: How To Avoid, Handle, And, Maybe, Start A Price War

In Price Wars, Part 1, we said that “a price war involves two or more competitors lowering prices in multiple rounds in an attempt to win market share. A less formal, but more telling description of this kind of competitive pricing is: A massive transfer of wealth from sellers to buyers.” In Price Wars, Part 2, we talked about the negative effects...
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60 Seconds on Pricing: Price Differentiation for Increased Sales & Profit

Here’s more on price differentiation — Selling the same product to different customers at different prices. In our previous video on price differentiation, we talked about how online retailers can identify their customers and price competitively based on online shopping patterns and how the consumer comes to your site. The ways they come — via a p...
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10 Important Pricing Lessons You Can Learn From Cartoons (Video)

Here’s the sixth in the series, Ten Things On Pricing, in which Jon Manning, Founder & Managing Director of Pricing Prophets, and Resident Pricing Expert for Upstream Commerce, looks at Ten Pricing Lessons From Cartoons. “Although usually humorous, cartoons usually have a serious message as well,” says Jon. Some of the takeaways about pricing Jon...
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60 Seconds on Pricing: How To Use Price Differentiation for Increased Sales And Larger Profit Margins (Video)

Online retailers can identify their customers — and price competitively — based on online shopping patterns and how the consumer comes to your site. This is called price differentiation. By examining and capitalizing on the way that the consumer comes to your site, merchants can create different price lines about how much the customer will be willi...
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