Impact Pricing Blog

An E-Commerce Price Segmentation

Last week I attended the Subscription Insider conference in New York where I ran into a “product” I had never seen or thought of, but it fits so well into one of the concepts I preach.  Price segmentation.  You should be charging different prices to different customers based on their willingness to pay.  

One price segmentation technique is charging different prices based on the characteristics of the customer.  In B2B we often charge lower prices in Asia and higher prices in the medical industry.  Region and industry are characteristics of customers we often consider when creating price lists.  

In B2C, students, seniors, and active military members often get lower prices just by showing an id to identify themselves.  BUT … how do you do this in e-commerce.  If someone claims to be a student, how can a vendor know this is true?  How can a vendor know that I’m not pretending to be a student just to get a lower price?  

Enter Sheer ID.  This is the product I bumped into.  Sheer ID enables companies to verify that a potential buyer has the characteristic they claim.  They search through multiple databases to confirm that John Doe really is a student.  

I didn’t test the product so I can’t attest to how well it works, but I think the concept is brilliant.  If you think price segmentation based on customer characteristics may be profitable to your company, here is a potential solution.  If you try them out, please let us know how well it works.  

Now, go make an impact!


Tags: price, price segmentation, pricing

Related Posts