Thank you for the article, Prof. Allon. Makes me wonder if ‘for public good’ industries like Education and Healthcare, are better placed than other more ‘perceived as commercial’ industries to pioneer price transparency, given the nature of service they offer. Or does it work the other way around that such industries have a larger potential of consumer back-lash.
Services are always going to be harder since cost allocation is much harder. For example, trying to break down the cost of an hour of MBA teaching will have to take into account, admission, career services, the TA's, admins, etc. But many of these are shared across degrees, and programs. Not impossible, but harder than for products.
"and 73% say they would pay more for products with fully transparent attributes." I am highly suspicious about this study. I think it depends, and more likely if a customer sees that the company earns a high margin (subjective to each customer), their WTP will drop.
Thank you for the article, Prof. Allon. Makes me wonder if ‘for public good’ industries like Education and Healthcare, are better placed than other more ‘perceived as commercial’ industries to pioneer price transparency, given the nature of service they offer. Or does it work the other way around that such industries have a larger potential of consumer back-lash.
Services are always going to be harder since cost allocation is much harder. For example, trying to break down the cost of an hour of MBA teaching will have to take into account, admission, career services, the TA's, admins, etc. But many of these are shared across degrees, and programs. Not impossible, but harder than for products.
"and 73% say they would pay more for products with fully transparent attributes." I am highly suspicious about this study. I think it depends, and more likely if a customer sees that the company earns a high margin (subjective to each customer), their WTP will drop.