Price differentiation
Posted: Tue Dec 17, 2024 6:15 am
Example: plane ticket
Another case is about fair prices. We use an example with airline tickets −ACM terrain− so that the question is easier to explain to the respondents.
You see an ad that says: “Fly to Barcelona from €30”. Suppose there are 1,000 seats available. How many of those 1,000 seats do you think should be for sale for €30?
Also read: Behavioral sciences & communication about corona: interesting tips and insights
The graph below shows the answers given but needs some explanation. The horizontal x-axis shows the number of chairs a respondent could choose from, between 1 and 1000. The vertical y-axis shows the cumulative percentage of respondents. For example, it can be read that 5 think it is okay if only one of the 1000 chairs costs €30. The advertisement is still factually correct because of the word "from". Almost a quarter of the Dutch (24%) think that all 1000 chairs in this example should cost €30.
The average for the entire sample is 535 seats. Where the slider was positioned (at 1, 500 or 1000) had no significant effect here, although people with the slider on the far left at 1 chose an average of 495 seats, compared to 550 seats for people with the slider on the far right at 1000 at the start of the question.
The main conclusion seems to be that there is quite some variation in consumer expectations when they read a “starting” price.
Airplane seat
Science has also done a lot of research into the marketing P of Price. What do consumers consider fair, for example, in price discrimination, i.e. different prices for the same product or a price tailored to a person ( personalised pricing )? Companies still seem to be reluctant to do this because they are afraid of their reputation or loss of trust.
Despite its profitability, [Personalized dynamic] spain telegram data pricing provokes strong negative fairness perceptions, explaining why managers are reluctant to implement it – from a 2020 academic article
A 2019 study showed that around 75 percent of consumers found price differentiation unfair. Even of the consumers who benefited from the differentiation with a lower price, around 65 percent still found it unfair. This is probably because they can imagine that they will end up on the wrong side next time and then have to pay a higher price. In addition, it is questionable whether the consumer has insight into how his or her price compares to that of the neighbor, because he or she does not see that price.
Consumers' judgment of how fair price differences are is also determined by the characteristics on which differentiation is made. For example, most Dutch people do not think it is fair if the color of the car partly determines the premium for car insurance. For example, they think price differences resulting from an auction are fairer than differences in price due to a different seller or different time .
Another case is about fair prices. We use an example with airline tickets −ACM terrain− so that the question is easier to explain to the respondents.
You see an ad that says: “Fly to Barcelona from €30”. Suppose there are 1,000 seats available. How many of those 1,000 seats do you think should be for sale for €30?
Also read: Behavioral sciences & communication about corona: interesting tips and insights
The graph below shows the answers given but needs some explanation. The horizontal x-axis shows the number of chairs a respondent could choose from, between 1 and 1000. The vertical y-axis shows the cumulative percentage of respondents. For example, it can be read that 5 think it is okay if only one of the 1000 chairs costs €30. The advertisement is still factually correct because of the word "from". Almost a quarter of the Dutch (24%) think that all 1000 chairs in this example should cost €30.
The average for the entire sample is 535 seats. Where the slider was positioned (at 1, 500 or 1000) had no significant effect here, although people with the slider on the far left at 1 chose an average of 495 seats, compared to 550 seats for people with the slider on the far right at 1000 at the start of the question.
The main conclusion seems to be that there is quite some variation in consumer expectations when they read a “starting” price.
Airplane seat
Science has also done a lot of research into the marketing P of Price. What do consumers consider fair, for example, in price discrimination, i.e. different prices for the same product or a price tailored to a person ( personalised pricing )? Companies still seem to be reluctant to do this because they are afraid of their reputation or loss of trust.
Despite its profitability, [Personalized dynamic] spain telegram data pricing provokes strong negative fairness perceptions, explaining why managers are reluctant to implement it – from a 2020 academic article
A 2019 study showed that around 75 percent of consumers found price differentiation unfair. Even of the consumers who benefited from the differentiation with a lower price, around 65 percent still found it unfair. This is probably because they can imagine that they will end up on the wrong side next time and then have to pay a higher price. In addition, it is questionable whether the consumer has insight into how his or her price compares to that of the neighbor, because he or she does not see that price.
Consumers' judgment of how fair price differences are is also determined by the characteristics on which differentiation is made. For example, most Dutch people do not think it is fair if the color of the car partly determines the premium for car insurance. For example, they think price differences resulting from an auction are fairer than differences in price due to a different seller or different time .