Price Discrimination and Price Differentiation Within Direct Mail

Segmentation and nonlinear pricing in the postal sector

“…These pricing scheme induce direct mailers to target new customers and to increase their mail demand, the lower return on investment (sending mail to prospective advertising targets is likely to be less profitable than sending mail to already known targets) being partially compensated by lower expenditure on postage. Duncan et al (2011) present examples which include "USPS Summer Sale" and "Royal Mail Sale", where postal operators propose short-term discounts and special offers. These authors also argue that sectorial price discrimination ought to be considered because underlying purposes, costs and revenues of the campaigns vary between sectors.…”