Consumers are divided on the issue of multi-tiered pricing tailored to
fit the customer's purchasing power. Not surprisingly, rich world
buyers are apprehensive. They feel that differential pricing is a form
of hidden subsidy, or a kind of "third world tax".
On September 2000, Amazon.com conducted a unique poll - this time among
customers - regarding differential pricing (actually, non-linear
pricing) - showing different prices to different users on the same
book.
Forty two percent of all respondents though it was "discrimination" and
"should stop" - but a surprising 31 percent regarded it as "a valid use
of data mining". A quarter said it is "OK, if explained to users". The
comments were telling:
"I work over 80 hours a week. As a small business owner, I may make
good money, but does that mean I should be charged more than
unmotivated individuals who are broke because they don't want to work
more than 30 hours a week. I don't think so ... Should (preferred)
customers disappear in (the) off-line world? Should Gold Cards or
Platinum Cards disappear? ...
The interesting thing is that discrimination of pricing is very common
in the insurance industry - the basis for actuarial work and in
airlines - based on load factors.
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