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Price Segmentation

This document discusses price segmentation, which is pricing similar products differently for different customer segments to increase company profits. It describes three degrees of price discrimination - first being charging each customer what they are willing to pay, second based on quantity purchased, and third charging different markets different prices. It also discusses segmentation hedges used to separate customers willing to pay more from those willing to pay less, like customer demographics, purchase time, location, and quantity purchased. The perfect segmentation hedge prevents customers willing to pay higher prices from paying lower prices.

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Terra Tucker
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0% found this document useful (0 votes)
834 views13 pages

Price Segmentation

This document discusses price segmentation, which is pricing similar products differently for different customer segments to increase company profits. It describes three degrees of price discrimination - first being charging each customer what they are willing to pay, second based on quantity purchased, and third charging different markets different prices. It also discusses segmentation hedges used to separate customers willing to pay more from those willing to pay less, like customer demographics, purchase time, location, and quantity purchased. The perfect segmentation hedge prevents customers willing to pay higher prices from paying lower prices.

Uploaded by

Terra Tucker
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd

Materi Kuliah Pentarifan

Disusun oleh : Farda Hasun


Departemen Rekayasa Industri
Fakultas Teknik
Universitas Telkom
Price segmentation (price discrimination in
economics) is the method of pricing the same
or similar products differently to different
customer segments
Objective: increase profit of the company
Price segmentation is a consequence of
market heterogeneity in willingness to pay
Heterogeneity in willingness to pay:
Derive different benefits
Have higher income
Have more time to price-compare and therefore
more price sensitive
First, Second and Third Degree Price
Discrimination
First degree or perfect price discrimination:
charging every customer at the price that
matches their willingness to pay
Second degree price discrimination: charging
different customers different prices according to
the quantity purchased
Third degree: charging different markets or
market segments different prices. An update to
classic third degree price discrimination is
including benefit based price segmentation.
Greater benefit is charged at higher cost
Complete, Direct and Indirect Price
Segmentation: classification based on the
information required to execute them
Complete discrimination: equivalent to first
degree price discrimination. Requires complete
information of all customers willingness to pay
in all situations
Direct segmentation: based on specific attributes
of the customers, such as age, gender, location
Indirect segmentation: based upon a proxy that
correlates to customer segmentation based on
willingness to pay: usage quantity, package size,
etc
Strategic or Tactical Price Segmentation
Tactical price segmentation: approaches in
unique situation, such as price promotion,
coupons, rebates
Strategic price segmentation: price structures as
a segmentation approach
Aftermarket transference
Product price with segmentation policies
need to have limited transferability
The key to price segmentation is the ability
to separate customers who are willing to pay
more from those who are not construct
segmentation hedges
Prevent customers who are willing to pay
higher price from paying a lower price
Four requirements for effective hedges:
Correlation with customers perception of value
Information needed for its implementation
Enforceability
Cultural acceptability
What
segmentation
hedges
will be used?
Customer demographics / firmographics
Age: child rate, senior citizen rate. E.g. children rate for airplane ticket
Children travelling with parents in group more price sensitive
Gender: ladies night, higher rate in salon for ladies
Income: scholarship for low income student
Time of purchase: indicator of leisure time. E.g. matinee price. Matinee
price not subject to time constraints associated with employment,
more price sensitive
Purchase location
Some of price difference can be explained by additional cost to serve: price of
food in airport
Buyer self identification: promotional sales, buyers club, coupons.
Company gives discount to people who really price sensitive, so they
have time to cut the coupons
Product engineered: addition or subtraction of specific features
Quantity purchased: order size, frequent purchase
Customer usage: two part tariff, enterprise software pricing
Negotiation: Individual price
Total volume
purchased
Stocking selection Customer
development / focus
Product mix Stocking level Dealer development
Order size Resale price Quality of warranty /
claims service to
customers
Order timing and
frequency
Competitor lines
carried
Returns behavior
Freight mode Promotional behavior Distribution / dealer
size and
concentration
Payment behavior Customer application
support / service
Distributor as a
buying group or co-
op
Every Day Low Pricing (EDLP) telah menjadi format
yang populer untuk toko bahan makanan. Beberapa
toko sejenis menerapkan Hi-Lo pricing di mana harga
produk tertentu bergerak antara harga normal yang
tinggi dengan harga diskon. Berdasarkan prinsip
segmentasi harga dengan pembatas segmentasi yang
sempurna (perfect segmentation hedge), format
mana yang diantisipasi sebagai yang lebih
menguntungkan? Jelaskan jawaban Anda
Time of purchase merupakan salah satu segmentation
hedge. Salah satu penerapan adalah memberikan
harga lebih tinggi pada saat liburan. Apakah ini cocok
diterapkan pada produk kuliner yang dikonsumsi oleh
penduduk lokal dan turis? Jelaskan jawaban Anda
Pembatas segmentasi yang sempurna
(perfect segmentation hedge) akan
mencegah semua konsumen yang bersedia
membayar lebih untuk membeli pada harga
yang lebih rendah.

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