Unfair Practice of Price Discrimination, Essay Example

Business firms use different marketing strategies depending on the size, time, and the types of products they deal in. Marketing strategies may focus on product (product marketing strategy) or on business itself (business marketing strategy) (Xia, Monroe and Cox). The commonly used product marketing strategies include value pricing (premium pricing), penetration pricing, price skimming and Price Discrimination. Price Discrimination is s strategy where a business entity offers the same product with different levels of quality and satisfaction derived from the different classes of the product (Xia, Monroe and Cox).

Business employ this strategy so as to have a variety for the consumers to choose from. While most customers may be willing to buy a given good or service from a producer, the market is divided according to the amount of disposable income, as such, discrimination pricing allows for the business to reach all segments of the market.

There are a number of instances where price discrimination may be deemed to be unfair. This is largely owing to the fact businesses are expected to offer the same terms of price to all customers at a given level of trade. A good example was when I booked a hotel room recently. It came to my attention that when one uses different websites, they get different prices for the same hotel room. When one books a hotel room directly they tend to pay more than a hotel room booked through a discount website. These discount websites usually do not reveal the hotel one can book until the booking is completed.

I believe that price discrimination is justifiable only within certain parameters. Of utmost importance is that price be discriminated for different levels of trade. Prices should remain uniform within the same level of trade.

Works Cited

Xia, Lan, Kent B Monroe and Jennifer L Cox. “The Price Is Unfair! A Conceptual Framework of Price Fairness Perceptions.” Journal of Marketing 68.4 (2004): 1-15. Print.