Price SegmentationAt the same time,

Price Segmentation
At the same time, different consumers may have different value perceptions and therefore could and most likely should receive different prices. Price segmentation sets and adjusts prices for appropriate market segments. Apple has a three-tier pricing scheme for iTunes downloads a base price of 99 cents, but $1.29 for popular hits and 69 cents for oldies but not so goodies.58
Starbucks similarly has raised the prices of some of its specialty beverages while charging less for some basic drinks.59 In part because of wide adoption of the Internet, firms are increasingly employing yield management principles or dynamic pricing, such as those adopted by airlines to vary their prices for different market segments according to their different demand and value perceptions.




Here are several examples :
• Allstate Insurance embarked on a yield management pricing program, looking at drivers’ credit history, demographic profile, and other factors to better match automobile policy premiums to customer risk proiles.60
• To better compete with scalpers and online ticket brokers such as Stub Hub, concert giant Ticketmaster has begun to implement more efficient variable pricing schemes based on demand that charge higher prices for the most sought-after tickets and lower prices for less desirable seats for sporting events and concerts.61
• The San Francisco Giants now uses a software system that allows the team to look at different variables such as current ticket sales, weather forecasts, and pitching matchups to determine whether it should adjust prices right up until game day. The software allows the team to take the price-tier strategy baseball has traditionally used and make it more dynamic.62
• New start-up Village Vines offers a demand-management solution to restaurants that allows them to effectively price discriminate by offering deal-prone customers the option of making reservations for 30 percent off the entire bill on select (less desirable) days and times.63