Before going to different type price discrimination we should know what is
differentiated pricing. It can be defined as different pricing for the same product or service
at different situations. It is a strategy which is now used by different firms and
organizations to maximum profit margin from different situations.
Customer segment:
It can be explained in this way that pricing is set according customer category some times
organization portray as discounted prices for that particular customer segment. An example
could be seen when national carrier like planes and trains of any country give special
pricing to students, senior citizens. Multiple times we have seen different prices of same
product according to age of a person like cheap tickets for people below 12 years and
normal ticket price for above 12 years and different price for senior citizens.
Product form:
It can be understood in a way that different prices are set for different variants of the same
products. For example, we see this sort practice in perfumes like the same perfume have
different prices because of the volume or you can say the quantity they are giving, same
goes in soda industry like 1.5 litter drink has different price like 100 rupees and the same
drink but 2.5 liters will cost you 200 rupees.
Channel of Distribution:
We can see this type of price differentiation in a way that same product will cost you
different because of different channel of distribution. Like you are buying any product like
clothes of any brand it will cost you different if you buy it from factory outlet of that brand
and cost will be different if you are buying from any other outlet which is not owned buy
that brand. Some times online prices are different from retail store prices. Price depend on
the channel of distribution if there are multiple middle persons like wholesaler, agents so
they will keep their profit so ultimately you see the difference in price if you compare the
price with factory outlet where there is no middle person.
Location:
Same product has different prices at different locations for example if we have dinner at a
restaurant in main city like Tariq road for example we consider Gaffar kabab and we had
the same meal from Ghaffar kabab but in port grand so it will cost you totally different it
will be more expensive in port grand area.
Time:
Same product will cost you different at different time for example if you are apparel
manufacturer you will set prices according to season for suppose in winters you will charge
high prices velvet dresses and when winter season will end so the same product made up of
velvet will be cheaper as compare to previous season rates. Another most common
situation is limited time deals like brands special discounts on different product for limited
time so the price totally depends on time at that situation.
Image Pricing:
Price are different for the same kind of product on the bases of an image. For example, you
see two sports wear or active wear both are totally same in term of fabric and every thing
which included in product but prices will be different if one belongs to local company and
another belongs to a known brand like Nike. In this case Nike product will be expensive
although both products are same but because brand image Nike will cost you more.
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