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5 Examples of a Price Signal

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A price signal is a price that is designed to convey a marketing message. The following are illustrative examples.

Luxury Signals

A luxury fashion brand prices a bag at $50,000. They don't mind if few customers purchase the bag because it is meant to serve as a symbol of the brand. Customers who purchase the brand's $700 bags get the status of a brand with a $50,000 bag.

Social Signals

Historically, many bars and nightclubs offered a "ladies night" with discounted prices for women. This served as a signal to men that women would likely attend. It should be noted that prices based on gender may no longer be considered socially acceptable or legal depending on culture and jurisdiction. However, similar signals are still common. For example, a "happy hour" with discounted prices for all may be used to signal a lively environment.

Welcoming Signals

Pricing the seeks to welcome a target market. For example, a restaurant where kids eat free is sending a message that the restaurant welcomes families.


Signals that seek to build goodwill with a community. For example, a convenience store that offers meals for $1 that have a value of $10 to a region that experienced a recent disaster and economic setback such as an earthquake. This is the opposite of price gouging whereby a firm tries to take advantage of a disaster by increasing prices.


Signaling involvement in a community, culture, cause or event. For example, a restaurant that sponsors a local sports team that offers discounted prices when they make the playoffs.
Overview: Price Signal
A price that conveys a marketing message.
Related Concepts


This is the complete list of articles we have written about pricing.
Algorithmic Pricing
Bargaining Power
Benchmark Price
Price Fixing
Cost-plus Pricing
Price Gouging
Customary Pricing
Decoy Effect
Everyday Low Price
Marginal Utility
Willingness To Pay
Dynamic Pricing
High-Low Pricing
Market Value
Flat Pricing
Loss Leader
Predatory Pricing
Price Discrimination
Snob Effect
Market Price
Price Competition
Price Leadership
Premium Pricing
Price Economics
Price War
Revenue Management
Veblen Goods
Price Floor
Price Promotion
Price Sensitivity
Price Skimming
Price Umbrella
Pricing Power
Pricing Strategy
Sticky Prices
Value For Money
More ...
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