Should retailers formally move to Differential Pricing?

If I ask most retailers do you believe that a product should have a different price in a London store as opposed to a store in Sheffield, the answer is invariably no. Retailers believe it is part of their brand promise that the product will have the same price whichever store you buy it from.

My question in this is why? Why is that important?

Could you not turn around to customers and say openly and honestly, look the rents are higher in London, staff costs are higher and distribution costs are higher, so prices have to be higher?
More importantly if I was a shopper in Sheffield, would I not want to know why the prices are not cheaper, particularly as consumers have lower incomes in Sheffield than in London.
Would it be an advantage to a retailer if they could use differential pricing? It would certainly allow margin and stock optimisation to a level that is not possible today.

Differential pricing has taken hold in Spain and Portugal, but not elsewhere in Europe, are they the vanguard of things to come or are they just different? Are UK retailers doing differential pricing but just up front about it with their customers?

We know retailers will offer the same product under different “fascias” at different prices.

What about consumers? The likes of Easyjet are certainly preparing us for differential pricing (of a slightly different form) with a vengeance. We all go onto the Internet and notice that prices for a product are different. So we realise that prices are not always the same? There are plenty of price comparison sites.

So is the retail consumer not ready for differential pricing?

Give us your views.