What is price discrimination?
Price discrimination indicates the method of either manufacturers, retailers or wholesalers to advertise with different prices for exactly the same products based on who wants to buy them. In earlier times this practice was misused, by for example offering different prices to people of other sex or skin color. This is really rare today.
Today most people might be aware of the fact, that they are offered different prices for example by airlines, depending on for example when they book, there are however even more and more characteristics that are used to differentiate between customers.
Applications to business
There are booking websites out there that actually give you a discount on whether you are booking from a usual computer or from a mobile device.
Liz Uber, vice president of revenue management at Pillar Hotels & Resorts explains this by saying that “some of these reservations will be booked the same day or 24 hours in advance when some of your discount rates are not available. If a hotel is not priced competitively in the market they will not be able to convert this potential guest.”
The travel sites Orbitz and CheapTicket for example used this technique already. Some deals are only available when you installed the sites app on your iPhone or Android device. Customers could by that see discounts of as much as 50 % from the original price. Moreover this applications is also determining the physical location and by that will offer different prices based on where the customer is located.
So when you shop or book next time, might be a good idea to recheck it undercover…