Thursday, November 13, 2014

How Victoria's Secret discriminates against men

The art of price discrimination is to identify consumers who are less sensitive to price, charge them a higher price, and prevent them from mimicking the behavior of more price sensitive consumers.  Victoria's Secret has discovered that their male customers are less sensitive to price than their female ones:

"The general feeling about men is that they would buy anything in order to get out of the store as quickly as possible," the worker, who wished to remain anonymous, told us. "That means they would spend more money." 
...Women are more value-oriented, and so we were encouraged to show them deals," she said. "Men would buy a couple of $50 bras without questioning us because they felt awkward."
HT:  Andrew


  1. AH, Is price discrimination everywhere?…Why does Victoria Secret dare use us men as a pawn in their sales :}? Answer is: they seem to follow the essence of price discrimination by identifying a group based on differences in demand. Vickys has also identified a means of assigning a higher value from a low value scenario through their male clientele and their uncomfortable purchase. The advent of internet is sure to put a damper on their sales through the privacy of shopping.

  2. Price discrimination is truly a part of our everyday lives. As the Investing Answers article attached describes, price discrimination can be found everywhere from Ladies Night at a dance club or Senior Citizen Day at the grocery store. (“Price Discrimination,” n.d.) The drinks at the club are being sold at half price while at the same time the price is attracting more women clientele as well as attracting more men clientele. The same situation is being reflected with Senior Citizen day at the grocery store. Most seniors are not able to drive themselves so the person assisting in transportation could be a potential shopper as well. It shows that with price discrimination, the same item is sold to different customers at different prices.

    These pricing strategies are aimed to attract those customers that are more sensitive to prices than others which are the main reasons why price discrimination is a successful sales tool.

    Price Discrimination. (n.d.). Retrieved from

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  4. Victoria’s Secret zeros in on men when price discriminating because the retailer knows that when most men go into a lingerie store they are either the type of man who enjoys shopping for lingerie or they hate the idea of even stepping foot in the store. Another reason Victoria’s Secret can get away with direct price discrimination with men is because most men are not concerned with the price of a gift for their significant other they just want to get the shopping over with. Lastly, men that shop at VS for their significant other don’t mind spending because they might feel they benefit from the gift as well. VS direct price discrimination strategy is actually smart, women are their main customers and are always looking for a deal but men occasionally shop there and have no idea of what the prices should be.

    Froeb, L. M., McCann, B. T., Shor, M., & Ward, M. R. (2014). Managerial Economics; A problem solving approach (3rd edition). Mason, OH: South-Western Cengage Learning.

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  6. There is merit to the notion that men approach shopping quite differently from women as it relates to buying products in a woman’s department store. Victoria Secrets recognizes that the sexes have different shopping priorities, thus, capitalizing on men’s approach to shopping. As Rushton, asserts, direct price discrimination between genders is done in a remarkable way, and almost constitutes a middle ground between direct and indirect. For the most part, in a women’s mind, shopping is a wonderful therapeutic experience that she could enjoy all day. So it is understandable why they need to go through every aisle, up and down, before making a final decision on an item. They naturally are bargain hunters.
    On the other hand, men have other things to do besides shopping, so they focus on the bottom line–– get in and out as quickly as possible then move on to other activities. In this case, Victoria Secret does not have to utilize indirect price discrimination––unable to identify a targeted group, but instead use direct price discrimination since it is a given that approximately 95% of men are not really bargain hunters when it comes to purchasing women’s apparel.. To discriminate directly, companies have to be able identify different customer group with different elasticity (Froeb.2014). Even though there is not a clear optional price for men and women, Victoria Secret sets up a high prices on some products knowing that most men are looking to impress their ladies and don’t have time to conduct a price comparison analysis. They simply will not seek out the lowest deal in the store but will purchase what they like at first glance. This demand has less elasticity. Taking advantage of this shopping behavior ultimately makes the direct price discrimination profitable for Victoria Secret.

    Leo Palmer ESC Econ.
    Froeb, MCcann, Ward, Shor. (2014) Managerial Economics. A problem Solving Approach.
    Ohio:South-Western Cengage Learning.

    Rushton. M.. Art Journal. Gender and Price Discrimination. Retrieved 3/3/15

  7. Designing and implementing “price discrimination schemes to make a profit happens with nearly all companies that are in competition with one another. Vitoria’s Secret heavily uses e-commerce as one of their methods to do this. Once they have you in their system, now they can target you by ZIP code just like many other retailers. The majority of the ads I receive are one day sales usually trying to sell items in bulk (e.g., 3 for $33) for products that have relatively low marginal costs or have less elastic demand, like swim suits where the gap between price and marginal costs is the largest. How much material does it take to produce most of these items – not much!
    Targeting men is very clever and appears to be direct discrimination by charging higher prices to a group with less elastic demand because we would rather not “hang-out” in the lingerie department for hours. Personally I don’t mind shopping at Victoria’s Secret at all; where else can you go for free and see beautiful women! I was on to their game a long time ago as well as many other stores. I think behavioral economics has been part of psychological pricing a lot longer than most people believe. Pretending like you want to shop as quickly as possible to get out of a store gets you faster service. A little reverse phycology goes along way especially if you already did your homework and know what you are going to the store for in the first place. The sales people see a man as “less price” sensitive and a target of opportunity. Many of us see them as a way to get in front of the line! As Froeb et al stated, “Only Schmucks pay retail”.

    Luke, F., McCann, B, Shor, M., & Ward, M. (2014). Managerial Economics; A Problem Solving Approach (3rd ed., p. 106). Mason: South-Western Cengage Learning

  8. VS has identified males as being an awkward, fast, uncomfortable shopper, whom are less sensitive to prices, while shopping in their store. However, VS is selling more than just a product, its also selling sex indirectly, and this type of purchase makes most people less sensitive to prices. VS has identified the male as the target in making an un-comfortable purchase- rightfully so, when a man walks in to VS, he has images of sex, beautiful sexy lingerie – beautiful people, he is clearly not thinking with his brain. VS will more than likely always benefit and price discriminate against men.

    Price Discrimination charges different prices to different groups of people for the same item and or services at different times. “The Price sensitive consumer groups can be identified as senior citizens, ladies, and college students- just to name a few” (Froeb at el, P.151).

    However, it’s the less price sensitive consumer that is the real target market when a campaign price discrimination package was created. The companies that practice price discrimination are in lure of the less price sensitive companion.
    The campaign was created to lure the consumer and their companion in to the store in hope that more items and or services will be provided. A few types of campaigns are: “coupons, age related discounts, resident parking, loyalty cards, time of purchase discounts, two for one offers, and quantity purchases, as in the more you buy, the more you save”( each of campaigns has a deal attached to it.

    So Buyer Beware - Sometimes. There are lots of times I participate in one of this price discrimination campaigns and don't qualify for the discount. Such as going to the movies on senior day - with my mother and I'm not entitled to the super huge discounts because of my age.

    Froeb/McCann/Ward/Shor, Managerial Economics, A Problem Solving Approach 3rd Edition, South-Western, Cengage Learning 2014, OH

  9. This is a great example of price discrimination and probably also work for “feminine” products or anything else that would make men feel uncomfortable. Victoria secret prints the price on the tags so it is not like they can make up a higher price just because a man comes in, but like the article points out, they more than likely will just “grab and go” resulting in more money spent versus women who may compare prices and products and come out with less or spend less overall. What is not fair at all is that there are laws protecting businesses selling to other business but as your text highlights, companies like dell can sell identical computer at different prices based on the consumer’s price sensitivity. (Froeb, 2014) My personal example of price discrimination was while I was waiting to move into my house that I just bought. I went into a target by where I was staying and was about to buy something, but I didn’t. I changed my mind the following week and went to the one near my new house and it was cheaper. What I found out after talking to people was that prices were more expensive in store “A” because they have higher instances of theft. I would have assumed the prices would have been higher in the “nice area.” Either way I don’t think it was far but I understand. You absolutely would pay more so the same shirt at Bloomingdales vs Macy’s, for example. The companies probably assume since you are shopping at a store with higher price points that you would pay more money for the item.
    Works Cited
    Froeb, e. (2014). Managerial Economics; A problem solving approach (3rd edition). Mason, OH: South-Western Cengage Learning.

  10. I don’t necessarily see this as direct price discrimination. According to Froeb, “price discrimination is the practice of charging different people or groups of people different prices that are not cost-justified.” The cost is not different for men and women. Men might end up paying more than women, but that isn’t because of price discrimination. According to an article from the Wall Street journal, “men aren’t major comparison shoppers and they’re willing to pay a little more to speed up the process than to spend time hunting down bargains.” This article wasn’t referring to lingerie shopping, but all shopping. If we accept that this scenario with Victoria’s Secret is just attributed to human behavior, then price discrimination doesn’t factor into it. Now, it may be reasonable to say that Victoria’s Secret “discriminates” in their advertising since they target women, but that does not have a direct influence on the cost of goods.

    1. To some extent, I would agree that this is not necessarily direct price discrimination. Froeb does point out that in a direct price discrimination scheme, members of the low value group can be identified (in this case women) and an optimal price can be set for each group. Although men and women would both have the opportunity to shop for the same bargains, the men would be less likely to do so if these bargains were harder to find within the store due to the differences in their shopping behavior. Froeb differentiates indirect price discrimination as requiring indentification of some "feature" that is correlated with value. The "feature" (differences in shopping patterns) is in this case is easily identifiable because it is tied to the sex of the consumer, it is a little more direct. In the case of high income shoppers being less likely to clip coupons, the consumers are essentially identifying themselves by their use of coupons or lack thereof.

      Works Cited
      Froeb, e. (2014). Managerial Economics; A problem solving approach (3rd edition). Mason, OH: South-Western Cengage Learning.

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  12. I agree that men are likely to spend more money in Victoria’s Secret than women, and that is for a variety of reasons. Men are probably more inelastic consumers for the products in Victoria’s Secret since they are purchasing them as gifts (most of the time). They have a particular product in mind and are willing to pay for it. The “uncomfortable” factor also comes into play, I’m sure. I’ve witnessed it with my own husband. He will do anything to leave that store.

    However, I agree with AJ C and Elbee Diaz that this is not an example of Direct Price Discrimination. Men are not being charged a different price than women. They are choosing to not shop for discounts and in-store specials, which makes them subject to Indirect Price Discrimination.

    In a blog on, economist Ben Goloub defines Direct Price Discrimination as “a type of price discrimination in which firms explicitly post different prices for different kinds of consumers, who are distinguished based on verifiable traits” (Goulob, 2014). This is not happening in this case. In the case of Victoria’s Secret, “consumers are not offered different prices explicitly, based on their external, observable characteristics, but implicitly, based on choices they make that reveal something about them” (Goulob, 2014). That is Goloub’s definition of Indirect Pricing. An example of Indirect Pricing would be the use of coupons. Coupons are similar to in-store specials (such as the offer to purchase 5 pair of underwear for a discounted bundle price).

    Froeb, et al. describe Direct Pricing as identifying “different customer groups with different elasticities” and then charging the different groups different prices (Froeb, et al, 2014, pg. 152). While this may be the outcome of Victoria’s Secret pricing models, because the different groups choose whether to take advantage of the in-store specials, the company itself does not determine which of their customers fall into which group, so it appears that Indirect, rather than Direct, Price Discrimination is being utilized in this case.


    Froeb, L.M., McCann, B.T., Shor, M., Ward, M.R. (2014) Managerial Economics: A problem solving approach. Third Edition. South-Western Cengage Learning: Mason.

    Goulob, B. (April 5, 2014). Why Would a Company Charge Different Prices for the Same Good? What is price discrimination and how does it work? Retrieved on 3/28/15 from

  13. Price discrimination is certainly nothing new, It has been around for a long time and it is everywhere. Victoria’s Secret is only capitalizing on the fact that most men, no matter how much they may love what their selling, do not want to be seen in their store. It’s no different than the mechanic who takes advantage of the woman who comes to their shop and knows nothing about cars. Ok maybe that’s worse because she will pay for things she does not need because she doesn’t know any better. But, my point is that it is up to the consumer to seek out the best deal. If they do not they will, most likely, end up paying a premium for their ignorance. I’m sure being able to purchase through their website has put a small dent in their price discrimination scheme. However, most men I know don’t plan far enough ahead to do so…so, they will be easily and readily duped!

  14. Victoria's Secret is definitely an organization that obviously practice price discrimination. Being a woman, I know that I will go into the store with coupons or will already know exactly what I want and what it will cost. Anything that is bought without any premeditated intention most likely will be something that is on sale that I know will be used. My husband has admitted to going into the store and simply telling the sales associate what he wants to buy, in general, and let them lead him in the direction of what to purchase, without necessarily thinking about prices or other options because he simply feeling awkward being in a women's lingerie/underwear store. For men who are not uncomfortable in the atmosphere this store presents, they will be able to walk out with the same purchases and deals that a woman may, simply because they do not allow themselves to fall into that price discrimination hole.

  15. The article about Victoria’s Secret is one that describes true price discrimination. It’s easy to differentiate between customers (men vs. women) and those getting the discounts are unlikely to sell to those who are paying full price (I seriously doubt that there are women outside of Victoria’s Secret selling bras to men on the black market). Something that the article touches on but does not elaborate on is the social aspect of the men’s behavior. They are entering a women-dominated retail store and are shopping for a product that they likely have no knowledge about. Furthermore, they are likely shopping for a gift, and are willing to pay what it costs. This is the flip side of the long-running idea that women feel taken advantage of when shopping for technical or mechanical items, or things that require bartering. What comes to mind in this instance is automotive repair and purchasing a new vehicle. Women in these situations, as men in Victoria’s Secret, are out of their element and unsure as to what is “appropriate” and thus their price points have no set starting point. Victoria’s Secret items are not commonplace to the men shopping there, and they likely buy many fewer items over the course of a year, much like women and car repairs. The article states that women are more “value-oriented” when shopping at Victoria’s Secret, likely because they will purchase there regularly and are aware that the store’s full price items are expensive.

  16. Kethem Novick, Managerial Economics, ESC FALL 2015

    We all know that price discrimination is the “practice of charging different people or groups of people different prices based on differences in demand” (p. 169). That said, I don’t necessarily believe that Victorias Secret discriminates, rather they take advantage of a situation where a consumer isn’t as price sensitive as another.

    Men (and some women who are in a hurry?) are merely being charged for the “express lane”. The fact that men could save money if they chose to shop a sale or clip coupons, but do not signifies the use of indirect price discrimination. Many men are uncomfortable in a ladies themed store, and want to get out as quickly as possible. This means, they may not want to speak to the sales staff about potential sales. They just want to get in and get out. This means they pay the higher price and many don’t even care about the small markup.

    I have noticed too that the art of the “bundle” is useful here. Consumers will purchase a product when the bundled pricing, which allows the seller to extract more consumer surplus, allows the consumer to feel like they are getting a deal. For example, the cost of a bra at $70 and panties at $10 or bundle the two for $75. I’m not even sure that men know how much women’s undergarments cost in a ‘normal situation’. I know my husband has no clue as I do all of the shopping for both him, myself and my son’s clothing/shoes/groceries, etc.

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  18. This post is hilarious and true. I can picture in my head this poor man blushing as he picks up a couple articles of clothing or even just lotion, body spray or other products for his girlfriend. It is also a great example of how price discrimination works. These more expensive items are likely not placed deep within a rack. They must be the items placed out front that a person rushing to get out of the store would just grab and go.
    I am not sure this is true price discrimination as it sounds as though the store has both what the men will buy and what the women will buy out on display at the same time. This almost seems more like economics of scope. Victoria’s Secret is smart enough to supply high cost products and low cost products for the various types of consumers to chose from.

  19. “Prices for brand-name drugs are typically higher in the U.S. than other developed countries. The drug industry has argued it's misleading to focus on U.S. list prices that exclude discounts struck behind closed doors with insurers. A Bloomberg News analysis finds that even after these discounts, prices are higher in the U.S. than abroad. Seven of eight top-selling drugs examined still cost more in the U.S. than most other countries. We can no longer sustain a system where 300 million Americans subsidize drug development for the entire world," said Steve Miller, chief medical officer for Express Scripts Holding Co., the largest U.S. manager of prescription-drug benefits. "In the U.S., list prices are just a little bit crazy, and even with discounts that are tied to that it is still higher than Europe," Reinaud said. The list price of Merck & Co.'s diabetes pill Januvia is cut in half on average by estimated discounts, according to the SSR Health data. Even so, Merck gets more than twice as much in the U.S. for a monthly supply of the same drug as in Canada, the next most costly place to buy it, Bloomberg found. Humira, AbbVie Inc.'s best-selling rheumatoid arthritis treatment, costs an estimated $2,500 a month in the U.S. after discounts, compared with about $1,750 in Germany, Bloomberg found. In other nations, the drug's price drops even lower. Gilead said its pricing is based on countries' economic and health backgrounds and negotiations with most governments are confidential.”

    This could potentially be a case of direct discrimination as based on Froeb “different pricing creates multiple demand curves” The goal is for the medical manufacturers to Prevent resale from low price points to high price point therefore preventing countries with cheaper medicinal costs from selling their products to customers from a high price market such as the United States. As stated by Froeb price discrimination is determined by difference in demand not marginal cost, the United States drug demand is high and as such is conducive to price discrimination. The United States is considered to be a mature or advanced economy as a result it’s markets can be considered to be less sensitive to price versus other economies who might not have a high demand or less mature economy as such drugs are charged at a lower price as they are more sensitive to price

    Retrieved from:

  20. As noted by Froeb, et al, 2016, price discrimination is the practice of charging different prices to different buyers or groups of buyers based on differences in demand. Charging different prices for identical items seems unethical and unfair, however, it is not illegal as long as it is not based on impermissible attributes (Shpanya, 2014). For example, in 1996 Victoria’s Secret mailed different versions of the same catalog with different prices offered for the same item to different groups of consumers. One disgruntled consumer who discovered this filed a class action lawsuit claiming mail fraud against Victoria’s Secret. She lost and the judge issued sanctions on the plaintiff’s attorney for filing a frivolous lawsuit (Shpanya, 2014).

    The motivation for price discrimination is that it allows a business to sell items to low-value customers who otherwise would not purchase because the price is too high. Charging lower prices to low-value consumers also means that businesses charge high-value customers higher prices making the practice controversial (Froeb, et al, 2016).

    According to this blog about Victoria’s Secret, price discrimination is also the art of identifying consumers who are less sensitive to price than other consumers. Men typically do not like to shop in a female environment where lingerie, etc. is being sold. Therefore Victoria’s Secret takes advantage of this by strategically placing more expensive goods near the front of the store. Men therefore end up spending more money than women. It’s also true that men are not typically paying more than women since both genders have access to the same items; however, women have the advantage of venturing deeper into the store to seek out lower cost items; a fact that highlights the price sensitivity of men.

    With the aid of technology, the practice of price discrimination continues to rise. In order for businesses to discriminate directly, they must be able to identify different customer groups with different elasticities and then set an optimal price for each group. By charging a lower price to the group with more elastic demand, and a higher price to the group with less elastic demand, businesses will continue to profit from dynamic pricing.

    Froeb, L. M., McCann, B. T., Shor, M., & Ward, M. R. (2016). Managerial Economics. A Problem Solving Approach. 4th Ed. Cengage Learning.

    Shpanya, A. (2014). What Is Price Discrimination and Is It Ethical? Retrieved from

  21. We all know how inconvenient it is for a man to shop for his woman, especially if he has to enter the elusive land of lingerie. We also know how much men love to shop – sense the sarcasm? So naturally, their instinct is to get in and get out as quickly as possible. But does Victoria’s Secret in particular price discriminate against men? What about other stores? Or is this assumption simply backwards?

    In early 2016, CBS did an undercover story about price discrimination after the New York City Department of Consumer Affairs released a study saying that women paid more than men. And it wasn’t just related to the retail industry. Two producers, one male and one female went to several local dry cleaning businesses and requested for the same service with nearly identical shirts. The woman was charged twice as much as her counterpart and at another store was charged $3 more.

    “The New York City study found differences in clothing like jeans, personal care products like razors, and toys like scooters. Their research showed that women paid more than men for similar products 42 percent of the time.” (CBS, 2016).

    Women have been conditioned to pay more, according to the article. And right now, there are no laws in retail to prevent this from happening. Some argue that there are more costs that go into making women’s clothing, such as a higher import tax.

    So I argue that this is not true, but in fact, the reverse is true. Price comparisons debunk this argument. Whether it’s scooters or clothing, women end up paying more than men.

    CBS News goes undercover to reveal gender price discrimination. (2016, January 25). Retrieved from

  22. Price discrimination has been a topic of debate for many years, particularly within the area of men versus woman. In the case of Victoria’s Secret, one could argue that men may felt embrace to ask question about sales or clearance when it comes to purchase intimate products at the stores, this appears to be contrary to woman who in many instances first check the clearance and sale racks prior to making a purchase decision. In addition, men tend to be more goal driven when it comes to purchases, meaning we go to the store buy a specific item of need and leave immediately, this behavior is contrary to women who usually go to the store with one goal and end up purchasing more thing than they intended to.
    Many of us (Woman and Men) observe this discriminating behavior in the local stores, but does it have the same effect when it comes to purchasing in the e-commerce site of Victory’s? Perhaps, men are more cautious about pricing and are able to compare better options when it comes to intimates purchases or when dealing with this type of purchase in a segregated environment, like home. Overall, men tend to be more goal oriented than woman and perhaps this has influence their purchasing habits when it comes to intimate purchases.

  23. Module 3 Blogspot #2

    The other thing to note here regarding the price discrimination is that this is a trend with several other items for women as well such as engagement rings. The taglines companies like to push on men are “Your woman deserves the best” so men will buy big engagement rings without realizing the 4 C’s.

    Additionally, in regards to VS, it is true. As a woman who has brought her husband in there, my husband isn’t uncomfortable looking for lingerie, it’s actually asking an employee for help that is intimidating for him (and it gets even worse when I bring our daughter in there). For my husband, it’s not intimidating for him to shop for me in a lingerie store, it’s uncomfortable when it’s for our daughter and he just wants to get out there ASAP.

    Lastly, price discrimination exists the other way around i.e. men gadgets such as tools, dress shoes, etc. While women tend to be more price conscious, if they are unaware what a product should sell for or are unsure what type of product is the best, they take the advice from the sales person or read reviews on line and go about their day. If they have to pay more for something that is deemed top of the line, women will do the same thing as well in order to have that item checked off the list.

  24. I find price discrimination to be an interesting topic. While Victoria Secret operates their business, they have created a business advantage by identifying the fact that men do not shop by price. Price discrimination is everywhere if you think about it. I belong to numerous loyalty programs. As part of these programs, I receive discounts off of my purchases or other advantages. Amazon has the Prime program of which I am a member. For $99 a year, I receive free shipping on all Prime items I purchase. I also receive free access to Prime Video and Prime books. This program has changed my shopping venue and I now make 90% of my purchases through Amazon. Prior to joining the program, I purchased occasionally but priced different vendors to get the best price. While price is still important, I am more apt to purchase on Amazon due to the free shipping. Smart businesses target consumers who add the most value to their bottom line. Another example that comes to mind is discounts for students. I recently purchased an Apple laptop and received a student discount. This makes sense because college students are more sensitive to price elastic. By reducing the price point for students, Apple may be able to increase sales and revenue. Discount programs targeting seniors are implemented for the same purpose, to drive revenue and sales.

  25. Apparently price discrimination is gender-neutral; I recently commented on another blog post that highlighted the "pink tax" whereby women paid more for the female-version of common items (e.g. razors) than men. So it's refreshing to see the concept of price discrimination goes both ways.
    According to Froeb, et al, "price discrimination is the practice of charging different prices to different buyers or groups of buyers based on differences in demand". Price elasticity of demand is different for products amongst different buying groups and companies can improve profits by charging different prices to the different groups.
    One aspect I believe impacts the price consumers will pay, and this case in particular, is the willingness or desire to comparison shop. A woman shopping at Victoria's Secret is more likely to compare item A vs. item B to try and get the best value. Or she might even leave the store and look at similar items at other retailers. But a man at Victoria's Secret is most likely shopping for a gift and less likely to comparison shop. And he might feel better about the gift purchased if it costs a little more. These factors impact the price elasticity of Victoria's Secrets products.
    I recently made a trip to this retailer for some needed "essentials". All items are marked with a retail price and discounts on items, if available, are also clearly marked. In this setting I didn't see the opportunity for Victoria's Secret to use discriminatory pricing in it's true form - charging a different price for the same item - but I could see the store sales people offering higher-priced items to men. So in this case it was a case of "upselling" men to buy higher items vs. true discriminatory pricing.

    Froeb, L., McCann, B., Shor, M., Ward, M. (2016). Managerial Economics: A Problem Solving Approach. Cengage Learning: Boston, MA.

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  27. Victoria Secret is not doing anything that any other company is doing when it comes to price discrimination. They look for a weakness and then they exploit it. Unfortunately, a lot of men are shy when it comes to shopping for women under wear, and that makes them an easy target. When they go to the store, they usually look for the sales person to help them shop and of course they are going to show them pricey items to purchase. Victoria Secret is going to categorize the customer who they think will pay the high price, middle and lowest price and men fall in the category of being willing to pay more. This is not the same type of product, but the principle is the same. Dell used to sell the same computer to three different groups and each group paid a difference amount for the same computer. They sold to individual home users, small businesses and fortune 500 companies and each group paid a different price. Dell asked their customers and found out who was price sensitive and who was not and that is how they priced their computers for each category. Eventually, customers caught on that the same computer was being offered at different pricing and Dell stopped doing that. If a company can find a legal way to market their product using price discrimination, they are going to do it. It is a temporary advantage for companies.

    Reference: Luke m., Froeb, Brian T. McCann, Mikhael Shor, and Michael R. Ward 2016. Managerial Economics. Published by Cengage Learning

  28. I agree there is direct price discrimination but it is not necessarily indirect. A price discrimination scheme in it's definition, "..a seller cannot directly identify low-value and high-value consumers or cannot prevent arbitrage between two groups. The seller can still practice indirect price discrimination by designing products or services that appeal to groups with different price elasticities of demand." (Froebe p.317)

    In this case Victoria Secret cannot directly alter prices to sell directly to males, certainly not - but the pricing and marketing does not allow for arbitrage (Froebe p.315). This is the exception. Buyers cannot defeat price discrimination naturally.Female consumers cannot take advantage of men's only sales and the associated discounts. This is not something Victoria Secret markets. In theory - I suppose female consumer could buy and then resell to male consumers privately but this is not something worth considering in my opinion.

    Unless Victora Secret runs a "men's only" sale and raises prices during that sale - then we could argue that arbitrage is possible.

    I think there are elements of direct and indirect price discrimination.

    Ref: Luke m., Froeb, Brian T. McCann, Mikhael Shor, and Michael R. Ward 2016. Managerial Economics. Published by Cengage Learning