This paper discusses the concept of perceived price fairness and its application to demand-based price systems in the restaurant industry. Although the service literature suggests applying a demand-based instead of a cost-based pricing approach, price discrimination is underused in today's restaurant industry - mainly due to a fear of potential price unfairness perception. This paper offers some innovative price systems and empirically tests their fairness perception on Swiss restaurant guests. Results indicate that (1) price discrimination based on output is perceived as fairer than based on time, (2) for attributes that increase perceived value, a price premium is considered fair.
Language
English
Keywords
demand-based pricing
perceived price fairness
restaurant industry
HSG Classification
not classified
Refereed
Yes
Event Title
37th European Marketing Academy (EMAC) Annual Conference