Financing and marketing management (1+1)

Unit 10 - Market Structure and Types

10.6. Oligopoly, Oligopsony, Price discrimination
Oligopoly: In economics, the market consist of few sellers who are highly sensitive to each other’s pricing and marketing strategies. There are few sellers because it is difficult for new sellers to enter the market. Each seller is alert to competitor’s strategies and move.
Oligopsony: In economics, oligopsony is a market where there is a small number of buyers for a product or a service. In this market structure, buyers have power over the seller. Because as there are small number of buyers, if they are united and pressure the seller to sell the product or service in a reasonable and affordable price, the seller must have to consider that.
Price discrimination: In economics, if one product or service has different price for different buyers which is provided by the same provider, then we call that price discrimination market strategy. This is practiced mostly in the case of monopoly kind of market. To apply this, the elasticity of demand should be different in different markets or in different market segments. A good example of this strategy could be the airlines company-“Emirates”. It has offered different prices for different category of passengers for the same destination. Such as, it has “Student package” for the students, “Honeymoon package” for the couples which are of lower price than their regular one.