Are you using gender-based price discrimination in your business?

by | Oct 4, 2022 | Business Tips | 0 comments

Psychological pricing is a sales strategy based upon the belief that certain prices will influence a potential customer and is designed to help remove resistance to making a purchase, so the company can make more sales.

There are a number of influencing factors that can help you sell well to your target audience. One of them is gender-based price discrimination.

What Is Gender-Based Price Discrimination?

Gender-based price discrimination can be defined as companies or services charging different rates to women versus men for no other reason than the fact that the customer is a woman. This so-called “pink tax” has been around since the 19th century, when women’s hats and gloves were taxed more than a man’s.

Over the years, gender-based price discrimination has become an increasingly common strategy amongst business owners, leading women to pay an average of 7% or more for goods and services, even though in some areas of the US this is actually illegal.

Gender-Based Price Discrimination in Retail

Women’s products tend to be higher priced than men’s. Studies have shown that the exact same toiletries as a man are priced 25% higher when put in a pretty package. Women’s designer clothes and accessories are significantly higher priced than, for example, a man’s suit or a pair of shoes.

Women are so used to paying more that they don’t really reflect on the issue. However, one study showed that they are paying an average of around $1,400 more annually, which over their lifetime can add up to a significant waste of cash they could have put into, for example, a retirement account.

The issue becomes even worse if you consider that many women earn one-third to one-half less than men simply because they are a woman. Pay equity is starting to improve, but women don’t get a 33% discount on their food, rent, electricity and so on. With more than 50% of all US households being headed by women, gender-based price discrimination can have a significant impact on their children as well, with it being tougher and tougher to make ends meet on a smaller salary and more costly products.

Women as the Shoppers in the Household

Even if a woman has a domestic partner, recent statistics show that women do around 90% of the shopping or make 90% of the major shopping decisions in a household, even buying the men their clothes and weighing in heavily on what were once “male-oriented products” such as cars. We can see the shift if we look at car ads, which now include women and children in the ads as a way to connect with female customers.

Women Buying Services

Women are also asked to pay more for basic services, such as going to the hairdresser or getting their clothes dry cleaned. One study conducted by CBS news showed women were paying more for exactly the same shirts because, the owners claimed, “Women’s clothes have to be handled differently from men’s because the pressing machines are designed for men’s shirts only.”

It is important to note that in New York City, certain cities in Florida, and in California, charging more for services is illegal.


More and more states are going to crack down on this trend, though legislation has been a long time coming. Decide whether it is right and fair to price in this manner, and then set your pricing accordingly.

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