文档介绍：Shuba Srinivasan, Koen Pauwels, & Vincent Nijs
Demand-Based Pricing Versus
Past-Price Dependence:
A Cost–Benefit Analysis
The authors develop a conceptual framework of the factors that motivate a retailer’s decision to rely on demand
conditions and past prices in setting current and future prices. Specifically, they examine the circumstances under
which retailers choose demand-based pricing versus past-price dependence for different brands and categories.
Given scarce resources and costs of price adjustments, demand-based pricing is more likely when the customer-
driven and firm-driven costs of adjusting pricing patterns are low or when the benefits of such adjustments are high.
First, the customer-driven benefits of demand-based pricing are expected to be greater in categories with higher
ration and for brands with higher market share and higher demand sensitivity to price. Second, the firm-driven
benefits are greater for categories with higher private-label share. Finally, the customer-driven costs are greater for
expensive categories, whereas the firm-driven costs are greater for categories with many stockkeeping units. The
empirical findings support the conceptual framework, implying that customer-driven and firm-driven benefits are the
main stimulants in the retailer’s choice of demand-based pricing. In contrast, customer-driven and firm-driven costs
significantly hinder retailer implementation of demand-based pricing. These insights enable retailers to identify
problem areas and opportunities to improve the allocation of scarce pricing resources. The results also contribute
to the ongoing debate in economics and marketing on the rationality of observed past-price dependence. Whereas
previous research points to the negative impact on gross margins of this practice, the authors find that retailers
weigh the costs and benefits of demand-based pricing rather than adhere to past-pricing patterns.
Keywords: demand-based pricing, past-price dep