Marketing: Chinese v. U.S. consumers - pricing strategies

"A Great Bargain or a Big Rip-off? Consumers' Perceptions of Price Fairness in the U.S. and China"

This article from the Knowledge@Wharton newsletter highlights a recent study of U.S. and Chinese consumers. The researchers asked undergraduate students in the U.S. and China to rate their sense of price fairness in several variations of a specific scenario. Variations included different products, locations, and time of purchase, as well as new versus returning or loyal customers. The researchers looked at the similarities and differences in U.S. and Chinese consumers' perceptions of price fairness; some possible cultural interpretations of these differences; and the implications for pricing strategies in China.

... these findings suggest that Americans may be less accepting of dynamic pricing at this point because "fair is fair" as they see it. "In China, there may be more room to maneuver" in setting different pricing levels, she said, because consumers tend to view pricing fairness in terms of how they fared in comparison to "in-group members," or friends versus strangers.....

"Marketers have paid increasing attention to the potential of dynamic pricing -- or individual-level price discrimination -- as technology and the Internet increase its prevalence," the researchers conclude. But they say their findings suggest that at least for now, "fairness concerns may limit consumer acceptance of such pricing practices and may do so differentially across cultures.....