Rate Differentiation

Rate differentiation refers to the practice of setting different prices or fees for various customers or segments based on specific characteristics, behaviors, or circumstances. For example, a service might charge higher rates for peak times or provide discounts for seniors. This strategy aims to maximize revenue by tailoring pricing to what different customers are willing to pay, while also enhancing accessibility for certain groups. By differentiating rates, businesses can better meet the needs of diverse consumers and optimize their overall market performance.