Which of the following are issues that must be dealt with in order for differential pricing to be effective?
A) The firm must differentiate between the market segments and structure its pricing to make one segment pay more than the other.
B) The firm must control demand such that the lower paying segment does not utilize the entire availability of the asset.
C) The firm must secure enough capacity to meet demand from each segment.
D) A and B only

Question

Quizplus · Accepted Answer

Both options A and B are necessary for effective implementation of differential pricing. The firm needs to identify the different market segments and price them accordingly, ensuring that one segment pays more than the other. Additionally, the firm needs to manage demand so that the lower paying segment does not consume all the available inventory. Option C, securing enough capacity to meet demand, is not necessary for differential pricing, as the firm can limit the availability of a particular asset to different segments based on their pricing strategy.

Which of the Following Are Issues That Must Be Dealt