This website uses cookies to ensure you have the best experience. Learn more

Price Discrimination Essay

641 words - 3 pages

Price Discrimination Online: Hollywood Goes to the Web

One of the most significant characteristics of the internet is that technology on the web allows for the collection of consumer behavior, attitudes, and profiles. When customers create profiles and make online purchases, behavior patterns and preferences are stored in customer databases, later analyzed to tailor specific services and products that match the customer profile best. The emergence of internet movie downloads will allow the industry to monitor consumer preferences and behavior that includes what they are willing to pay and how often they buy. This is very similar to price discrimination, which can exist when three ...view middle of the document...

This will revolutionize the way they make their profit.
By supplying the movies directly to consumers online, they can also eliminate costs they incur in the current model of distribution. Additionally, distributors can earn more revenue by charging premium prices. For example, they can charge consumers more for the ability to stream new movies before they become available on DVD, and charge less in order to allow them to view older movies. In addition, they can keep customers engaged through monthly plans or pay-per-view giving the consumer several pricing options to choose from. In doing so, the distributor will essentially be a perfect discriminating monopoly. Further, customers who register online can personalize movie playlists and enroll in membership rewards loyalty plans. This could motivate them to watch more movies in the convenience of their own homes versus having to go to the theatre. Reward like free movies will maintain loyalty from these customers.
The movie studios and distributors have recognized that...

Other assignments on Price Discrimination

Monopoly Essay

697 words - 3 pages  unit  is  the  difference  betwee EFFICIENCY, EQUALITY AND CONCENTRATION OF POWER MONOPOLY take place, there is no deadweight loss, and the entire surplus derived from the market goes to the monopoly producer in the form of profit. (b) Monopolist with Perfect Price Discrimination (a) Monopolist with Single Price Price Price Consumer surplus Monopoly price Deadweight loss Profit Profit Marginal cost Marginal

Micro Economics Mcq Essay

2116 words - 9 pages charging two different groups of consumers two different prices is practiced in:  A. Price discrimination B. Two-part pricing C. Price matching D. None of the statements associated with this question are correct Answer:  39. One of the conditions under which price discrimination is profitable is:  A. Ability to identify consumer types B. Inability to resell the good C. Differences in demand elasticities D. All of the statements associated

Homework Week 8

1145 words - 5 pages adapt the price base on locations, allowances, promotion events and price discrimination. With different price stratege in different time can make a company gain more customers and profits. Having good offer to customers is a good marketing strategy for a brand. * Chesky, Gebbia and Blencharczyk had to decide whether to focus on expanding property listings or filtering and ensuring the quality of the listings they had. Which should they focus

Yield Management

1255 words - 6 pages strategy involves in yield management is commonly known as price discrimination. The hotel or airline industries tend to use this most often due to the following industrial traits: 1. Fixed capacity 2. Predictable demand 3. Perishable inventory 4. Appropriate cost and pricing structures 5. Uncertainty of the demand There are 6 elements in Yield Management. According to Forgacs (2010), Yield Management

Hr434 Exam 2

940 words - 4 pages ) What is reverse discrimination and how does it influence the design of an executive compensation plan? Reverse discrimination is a form of discrimination that occurs against members of a dominant or majority group, or in favor of members of a minority or disadvantaged group. Highly paid employees, like executives, experience reverse discrimination because of laws and legislation meant to help minorities. Executives face discrimination in

Econ251

438 words - 2 pages among each other. Discrimination: Members and Non-members. The economic case for regional integration is straightforward. Economic theories of international trade predict that unrestricted free trade will allow countries to specialize in the production of goods and services that they can produce most efficiently. 3. What is Most Favoured Nation (MFN) principle? Are trade blocs consistent with MFN principle? MFN principles means that

Econ

4124 words - 17 pages duration. (`) All factors of production are variable. (a) At least one factor of production is fixed. (b) Marginal costs are constant. (c) Average total costs are constant. 38. In order for a firm to engage in price discrimination, it must be (d) able to separate consumers into different groups based on demand elasticities (e) producing in the inelastic portion of its demand curve to

Apple And Google

275 words - 2 pages Apple V/S Google Apple and Google differ significantly in what they sell (Apple’s innovative products Vs. Google‟s Technological Services) and their revenue generation models (Price discrimination and skimming of Apple vs. Ad based revenue of Google). Hence we are not sure whether we are comparing Apple with apples here! Nevertheless one interesting and meaningful comparison is given by the Market cap of the two technology firms. In May

Egt1 Task 3

760 words - 4 pages Antitrust Act, The Federal Trade Commission, and the Celler-Kefauver Act. The Sherman Act was created in 1890 had two major provisions which was to prohibit conspiracies to restrain trade and also to outlaw monopolization. In 1914 the Clayton Act was passed to expand off of the Sherman Act. The Clayton Act strengthened the Sherman Act in several ways: price discrimination, typing contracts, acquisition, and interlocking directorates. In 1914, the

Pricing

6384 words - 26 pages differentially in 1999. Some Amazon customers discovered that they had been charged different prices for the same DVDs. Inferring that the price discrimination was based on their past purchasing behavior, customers complained vociferously in chat rooms and on Internet bulletin boards. The snowballing controversy led to Amazon’s retraction of the practice.10 As this experience demonstrates, consumers are resistant to DP that is based on their

Analyst Paper

819 words - 4 pages name • Functionality • Styling • Quality • Safety • Packaging • Repairs and Support • Warranty • Accessories and services Price Decisions Some examples of pricing decisions to be made include: • Pricing strategy (skim, penetration, etc.) • Suggested retail price • Volume discounts and wholesale pricing • Cash and early payment discounts • Seasonal pricing • Bundling • Price flexibility • Price discrimination Distribution (Place

Similar Documents

Price Discrimination Essay

4326 words - 18 pages Introduction There are a lot of different pricing strategies defined and described. Different companies implement different pricing strategies. But the goal is the same for everyone – to gain maximum profits and to keep one’s business successful. This is there price discrimination could help to solve the problem. Different prices for different segments, in different countries or in different amounts – there are few ways how to implement price

Summary Of The Article Written By Joanna Stavins

624 words - 3 pages Summary of the article written by Joanna Stavins, Price Discrimination in the Airline Market: The Effect of Market Concentration The article is based on the assumption of the price discrimination increases with the competition in the airline market. Introduction: The relationship between price discrimination and market concentration has already been studied by Dana (1998) and Gale&Holmes (1993); the first states that PD1 could be

Economics For Managers Essay

2410 words - 10 pages  economic profit.  There are two forms of rent seeking activity to pursue   by a monopoly: 1. Buy a monopoly — transfers rent to creator of  monopoly. 2. Create a monopoly —uses resources in political  activity. 39 Price Discrimination  Price discrimination is the practice of selling different  units of a good or service for different prices.   To be able to price discriminate, a monopoly must:  Identify and separate different buyer types

Economics Essay

2233 words - 9 pages chosen to work out nicely, but it may be difficult to do by hand, so feel free to use a calculator.) Set average total cost equal to the demand price: 400/Q + 4 = 120 − 4Q ⇒ 400 = 116Q − 16Q2 ⇒ 4Q2 − 116Q + 400 = 0 ⇒ Q2 − 29Q + 100 = 0 ⇒ Q = 25. The firm will earn zero profit. Price Discrimination 3. Suppose you are a monopolist that is debating charging a single price for your product or different prices to different customers based on their demand