MARKETING AGENCIES AND THE ECONOMICS OF MARKET SEGMENTATION

Increasing importance is being attached to market segmentation strategies as a means of increasing producer returns. In this paper, a generalised model of price discrimination without supply control is developed to analyse the implications of optimal segmentation strategies for non-homogeneous products. It is shown that the magnitude of producer returns is dependent on demand and supply conditions, with increases in returns falling as price elasticities of demand and supply increase. The model is applied to the New Zealand sheep meats industry to reveal that returns to producers from market segmentation strategies could be quite low in the long run.


Subject(s):
Issue Date:
1987-12
Publication Type:
Journal Article
Record Identifier:
http://ageconsearch.umn.edu/record/22271
PURL Identifier:
http://purl.umn.edu/22271
Published in:
Australian Journal of Agricultural Economics, Volume 31, Number 3
Page range:
242-255
Total Pages:
14




 Record created 2017-04-01, last modified 2018-01-22

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