Management Glossary

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discriminatory pricing

A pricing strategy that charges different prices to different market segments for the same product or service. The objective is to attempt to come closer to obtaining the full value that every customer perceives in a product when different customers value the same product or service differently. A common example is air fares. The airlines try to devise rules that will charge higher prices to business travellers than to pleasure travellers since the former is usually willing to spend more for air travel.

In this case, the word "discriminatory" is descriptive, not a value judgment.

Contributed by: ManagerWise Staff

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