The risks of localized pricing

The following brief comment was in response to a RetailWire discussion (and a Wall Street Journal article) about new kinds of “pricing discrimination.” In particular, more and more stores and websites are pricing differently based on consumers’ location — in some cases, charging more for products in less affluent locations. I see some clear risks in this strategy:

In the ongoing tug of war between retailers looking for “pricing power” and consumers empowered by technology, I would not bet against the customer in the long run. “Pricing transparency” is a growing concern for retailers, but localized pricing tactics as described in the WSJ story have a good chance of backfiring.

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