By Jessica Appleton, with Annie Nguyen
Have you ever heard of ‘gender pricing’, or ‘price discrimination’? If not I will give you a brief summary.
Gender pricing is where you find the same or very similar item for sale for both men and women, yet the man’s item will be cheaper for no apparent reason. This practice is so out of control it can vary the price difference from 5c to $25 or more. Various age groups are targeted, including youth, adults and seniors.
And the worst part about this whole situation? Children gender pricing. It is beyond ridiculous, and desensitising the young to this practise before they have enough awareness to recognise and reject it. For example, a bar of chocolate wrapped in blue that your child may want compared to the one with pink on it – the blue one is 25c cheaper.
So presenting what I have found out there – there are three main types or degrees of price discrimination. They vary but all hold true to the same concept – they utilise a pricing strategy where the seller or company are responsible for identifying acute consumer ‘wants’, and then selling their goods or services for the highest price possible in order to capture every last dollar you have, and of course, for them to earn more revenue and profits.
- Personalized Pricing – selling to each customer at a different price, the optimal incarnation of this is called Perfect Price Discrimination and maximizes the price that each customer is willing to pay.
- Product Versioning – offering a product line that is popular but putting their own twist on it so it’s not exactly identical but similar enough to appease to the public, they are selling these items at different prices to different people.
- Group Pricing – dividing up the market in segments and charging a different price to each group, for example setting different prices on the same item for students, people who take public transport and seniors. Everyone pays a different price for the same item.
Overall the concept tends to set prices commensurate with the expected income of each age bracket, with the highest charge going to the adult population due to market’s consumer surplus. This surplus arises because in a single clearing price some customers would have been prepared to pay more than the single market price.
I have visited a few different stores and found some perfect examples so you can see what I’m talking about, and decide for yourself what you think, and how you will respond:
- Coles :
- Women’s Gillette shave gel sensitive 195g price $7.45
- Men’s Gillette shave gel sensitive 195g price $6.75
- Men’s Essentials T-Shirt Black price $5.00
- Women’s Essentials T-Shirt Black price $4.00
- Women’s Select deodorant roll on antiperspirant 50ml price $2.59
- Men’s Select deodorant roll on antiperspirant 150g price $1.99
The solution? Although many Australian markets encounter price transparency across many decades, consumer groups have become smarter and more aware of pricing to businesses in their goods and services in recent years. Rising economic rates have also encouraged Australian consumers to become more aware of overseas prices generally, such as myself, and to hunt and look for better price differences for similar goods and services in Australia. However I have still managed to purchase goods directly from overseas suppliers with considerable savings and value, even when distribution costs were taken into account.