It was a rare experience for me, for there is hardly any water in the Indian rivers to permit rafting (unless one goes to the Himalaya), and I went to buy the photos as a souvenir and to send home. I asked the person at the counter the price. And was flabbergasted to hear this:
- $30 for 10 photos, and
- $15 for 1
On the way home I was musing about this pricing scheme... No doubt, the objective was to maximise profits. The more photos you sell, the merrier. So make 'em buy more. Getting one at $15 is outrageous; one would rather buy them @ $3 per, by shelling out 30 bucks.
If one can afford 30 bucks, that is.
So what about students? Or the poor? Or, what-the-heck all 10 of them look the same, and I want only one. Which is why the second option exists. The technical term for this, I believe, is market segmentation. Still as I said before, you would rather buy 10 if you could, for it is better deal.
And one more thing: They sell digital photos, duplication cost of which is practically zero. There are atleast 6 people in every raft. If they are clever enough, they will buy one CD of 10 photos and make copies for everybody, thereby splitting the cost ($0.50 per photo per person). On the other hand, if a single photo were more reasonably priced (say $5) the group might now buy only one photo and copy. Why would they buy only one? (1) As I told you, all 10 of them are similar. And (2) anybody would try to spend as little as possible.
Therefore, by arranging the price thus, the seller is happy (sells more) and so is the buyer.
Any other thoughts?