Retailers changing prices depending on location and perceived incomes

myp · Dec 24, 2012

From Orbitz to Amazon to now some traditional retailers, this is a trend that is catching on. A move towards discriminatory pricing is not necessarily a bad thing (it could actually be a very good thing- look at the airline industry). Will be interesting to see how this unfolds.

http://www.theverge.com/2012/12/24/...nline-prices-depending-on-income-and-location

David · Dec 24, 2012

myp said:
From Orbitz to Amazon to now some traditional retailers, this is a trend that is catching on. A move towards discriminatory pricing is not necessarily a bad thing (it could actually be a very good thing- look at the airline industry). Will be interesting to see how this unfolds.

http://www.theverge.com/2012/12/24/...nline-prices-depending-on-income-and-location

My company raises prices in stores where business is brisk and lowers them where it's slow. Amazing how few of our customers have caught on, we don't even deny it if they ask and yet the vast majority remain oblivious.

myp · Dec 24, 2012

David said:
My company raises prices in stores where business is brisk and lowers them where it's slow. Amazing how few of our customers have caught on, we don't even deny it if they ask and yet the vast majority remain oblivious.

Even if they knew though, it shouldn't really matter. At the face of it this might seem shocking or like greed to people, but really it is not. Economically, price discrimination can be a very good thing in moving towards more efficient markets.

David · Dec 24, 2012

myp said:
Even if they knew though, it shouldn't really matter. At the face of it this might seem shocking or like greed to people, but really it is not. Economically, price discrimination can be a very good thing in moving towards more efficient markets.

Sure, high prices where buying is high and lowering them where it is low (attracting more customers) leads to higher profits. But from a consumers POV, the better the store, the more you get ripped off. I noticed this week we raised the price on an item by $.70 while also selling it at it's original lower price. The only difference is we changed the packaging and put the higher priced stuff in a more obvious place (the lower priced product was just 2 steps away and untouched). :giggle:

We gotta make our billions somehow I guess.

myp · Dec 24, 2012

David said:
Sure, high prices where buying is high and lowering them where it is low (attracting more customers) leads to higher profits. But from a consumers POV, the better the store, the more you get ripped off.

That is actually not true. Note that I did not say financially this is a good thing- I said economically. This sort of price discrimination often allows for greater output by producers AND greater consumption by consumers. Coupons are an example of price discrimination that isn't villified- so are many airline practices that actually helped make airfare affordable for the ordinary populous in the first place.

David said:
We gotta make our billions somehow I guess.

Price discrimination can be a win-win for consumers and producers.

David · Dec 24, 2012

myp said:
That is actually not true. Note that I did not say financially this is a good thing- I said economically. This sort of price discrimination often allows for greater output by producers AND greater consumption by consumers. Coupons are an example of price discrimination that isn't villified- so are many airline practices that actually helped make airfare affordable for the ordinary populous in the first place.

Price discrimination can be a win-win for consumers and producers.

Well, we make money. Not our fault people are stupid and/or rich. I actually had someone buy something from me without knowing the price. I put some godawful high price on it but ended up feeling bad and charged them something a bit lower. No idea what it really cost but if they were willing to pay whatever I told them, who am I to argue?

myp · Dec 24, 2012

David said:
Well, we make money. Not our fault people are stupid and/or rich.

It isn't "stupidity". Discriminatory pricing works because people place varying values on things vs. the money they have. Value is subjective and marginally diminishes- that goes for products as well as money.

David · Dec 24, 2012

myp said:
It isn't "stupidity". Discriminatory pricing works because people place varying values on things vs. the money they have. Value is subjective and marginally diminishes- that goes for products as well as money.

It is stupidity. A smart costumer will ALWAYS look for the cheapest, highest quality product. They may not shop around for whatever reason but they will look for such things wherever they are shopping. I get those too but they're fewer in number which can be a good thing or a bad thing depending on just how stupid the customer is. Sometimes I'd rather not make money then deal with the brain dead fools I get.

myp · Dec 24, 2012

David said:
It is stupidity. A smart costumer will ALWAYS look for the cheapest, highest quality product. They may not shop around for whatever reason but they will look for such things wherever they are shopping. I get those too but they're fewer in number which can be a good thing or a bad thing depending on just how stupid the customer is. Sometimes I'd rather not make money then deal with the brain dead fools I get.

That isn't stupidity though. Have you ever considered that for some people they have so much money that blowing some extra doesn't matter to them? Or they don't care about money and hence, don't mind blowing some of it. Their time might well be worth more than their money too.

clax · Dec 25, 2012

David said:
It is stupidity. A smart costumer will ALWAYS look for the cheapest, highest quality product. They may not shop around for whatever reason but they will look for such things wherever they are shopping. I get those too but they're fewer in number which can be a good thing or a bad thing depending on just how stupid the customer is. Sometimes I'd rather not make money then deal with the brain dead fools I get.

A sucker is born every minuit, these people keep the economy good and strong. If you don't have enough sense to look online, pay the premium, knowledge is power.

Look at cell phone stores, a car charger for thirty bucks, you can get them online for two. The dummies buying them know that, but they still buy the marked up one. Its the same thing just doesn't have the tmobile logo on it.

I wouldn't feel bad in the least selling them. They want the name on it, it isn't dishonest just hilarious

myp · Dec 25, 2012

David said:
Well, we make money. Not our fault people are stupid and/or rich. I actually had someone buy something from me without knowing the price. I put some godawful high price on it but ended up feeling bad and charged them something a bit lower. No idea what it really cost but if they were willing to pay whatever I told them, who am I to argue?

Another question for you. Do you always use coupons when you buy groceries? There are almost always coupons for a large number of products in the local papers. Ever buy groceries without using them? If so, that wasn't "stupid" of you, was it? It might just not have been worth your time and effort.

David · Dec 25, 2012

myp said:
Another question for you. Do you always use coupons when you buy groceries? There are almost always coupons for a large number of products in the local papers. Ever buy groceries without using them? If so, that wasn't "stupid" of you, was it? It might just not have been worth your time and effort.

I don't buy groceries. I work at a grocery store, it's easier to just eat when I'm at work.

And yes, I uses sales and coupons when they're available.

myp · Dec 25, 2012

David said:
I don't buy groceries. I work at a grocery store, it's easier to just eat when I'm at work. And yes, I uses sales and coupons when they're available.

And those that don't use them are stupid? That is the point I'm getting at...

You know for some people $0.50 doesn't matter, right? In the same way for others, $1000 or even $1000000 doesn't matter.

blurinoctober · Dec 28, 2012

It works well that it's partially based on what is basically cost of living, stores do this in physical locations, but it's weird to hear online. The factor of other stores being close makes financial sense, yet also seems really irritating. What happens if someone does not allow the store to access their location when they're online? Is there a set of prices that apply then?

Retailers changing prices depending on location and perceived incomes

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