PRICING DIFFERENTIATION

chpt 15 in the Sommers book  chpt 17 in the Shapiro book
 
 

In the Toronto Star March 16th 2005 there was a good story about how a female and male reporter went to buy some common items and found a big difference between the prices that men may for some clothes compared to what women pay. The story contains some good comments about product life cycles and other things effecting pricing.

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written by Dana Flavelle and Christian Cotroneo

"You Paid What for that Shirt?"

"...some people want to know why women often must spend more than men for the same items..."
 

After an eye-opening trip to the mall with his wife, Liberal MPP Lorenzo Berardinetti introduced a private member's bill that would make it illegal to charge women more than men for similar items and services. The bill, to be debated April 14, means hairdressers, dry cleaners, clothing stores and other retailers would have to charge the same prices to women as they do to men. Following his lead, the Toronto Star did its own shopping survey during a visit to the Eaton Centre to find out if the gender divide really is alive and well in the checkout line. Flavelle and Cotroneo explain "A male and female reporter headed to their respective departments, looking for a simple button-up shirt and a pair of khaki pants. The men's khakis, which seemed to be made of a sturdier, thicker material, cost $69.50. The corresponding pair for women rang in at $79.50. Meanwhile, a white button-up shirt for men cost $49.50, while the women's version was priced at $54.50. There's a reason why similar items are priced differently for men and women, according to the helpful store manager, who insisted his name not be published, as per company policy. Men, he explained, are shoppers by necessity. "If it's winter," the manager says, "he will buy a sweater." Those ubiquitous khaki pants the store has built its name on have a much longer shelf life for men because men wait until they need a pair before buying. And they're essentially always the same pair of pants. Knowing this, the company can manufacture them in bulk and let the pants sit around for as long as it takes to sell them. The store guide suggested the pattern is different for women — where the product cycle is considerably shorter. Women's clothing generally costs more because styles change more often; there are fewer economies of scale. Flavelle and Cotroneo explain "The woman behind the counter at Natural Solutions Spa said a wash, cut and style for men ranged from $30 to $35. Women, on the other hand, can pay up to $65, depending on the stylist's experience level. It costs more to cut a woman's hair, the receptionist explained, because there's more of it." It is long been a contention among men and women that women get ripped off at the dry cleaners. Flavelle and Cotroneo did some research to ascertain why this is the case. Flavelle and Cotroneo describe that "The dry cleaners justified the difference by saying women's suit pants are often lined, which means they have to be pressed both inside and out, a more labour-intensive process. Similarly, women's shirts are typically made of fabrics that require dry cleaning, while men's can be laundered for less money. Another operator explained that women's smaller shirt sizes don't generally fit standard machine presses. That means a man's shirt costs $2.29 to launder at Stanley Cleaners in Leaside, while a woman's shirt starts at $6. At Sketchley's Cleaners on Yonge St., a man's shirt costs $2.13 and a woman's starts at $4.75. At Kew Beach Cleaners on Queen St. E., meanwhile, a man's shirt costs $1.10 to launder and $3.25 to dry clean. A woman's shirt costs $2 to launder and starts at $3.25 to dry clean."

 

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