Price discrimination is not a new thing. There are anecdotes showing it has been applied in ancient times. “The King was charged an exorbitant price for an egg while on a visit to the countryside. “Oh, eggs must be rare around these parts!” the King exclaims. “Oh, no. The eggs are not rare, Kings are.” retorted the villager.
Or even some years back when I was visiting Albania I discovered that returning emigres living abroad like myself, were being charged double for a haircut compared to people living there.
The list goes on…
Who would have thought that western corporations would join the likes of medieval peasants and Albanian barbers in applying this time honored technique?
An article on ABC news today, pointed out that Mac users are more likely to be shown higher prices than PC users, while shopping for fares on Orbitz.com. Orbitz says its data show that Mac users spend as much as 30 percent more on hotels than PC users do. Great! Does this mean that Mac users are richer, or just that PC users are cheap? They should have included this in the “I am a mac, I am a pc” ad.
Even more intriguing is recent a patent application, which aims to present the invention of “guessing” a user’s purchasing power online, and using that information to display the highest price that the user can bear. Fantastic! Those who have more must pay more. It is the same with taxes.
Or is it?
Comments on: "the price is (al)right" (1)
It is true and happenning all over the place: this is from the economist today
“IN MANY types of face-to-face retailing, it pays to size up your customer and tailor your offering accordingly. In a 2006 study of Fulton fish market in New York, Kathryn Graddy of Oxford University found that dealers regularly charged Asian buyers less than whites because the Asians had proved, over time, more willing to reject high prices, and readier to band together to boycott dealers who ripped them off.
The internet, by allowing anonymous browsing and rapid price-comparing, was supposed to mean low, and equal, prices for all. Now, however, online retailers are being offered software that helps them detect shoppers who can afford to pay more or are in a hurry to buy, so as to present pricier options to them or simply charge more for the same stuff.
Cookies stored in shoppers’ web browsers may reveal where else they have been looking, giving some clues as to their income bracket and price-sensitivity. A shopper’s internet address may be linked to his physical address, letting sellers offer, say, one price for Bel Air, another for Compton. Doug Bryan of iCrossing, a digital-marketing consultancy, explains that the most up-to-date “price customisation” software can collate such clues with profiles of individual shoppers that internet sellers buy from online-data-aggregation firms. All this is fairly cheap, he says.”
http://www.economist.com/node/21557798