The central premise of price segmentation, especially in business-to-business environments, is that pricing should be consistent for similar deals. The process quantifies similarity by empirically determining which deal circumstances affect price response, enabling companies to benchmark prices against similar transactions.
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result. For example, a business considering a price increase of its product might find that doing so lowers profits if demand is highly elastic, as sales would fall sharply. Similarly, a business considering a price cut to its product might find that it does not increase sales if demand for the product is price-inelastic. While price elasticity explains differences in price response, determining it and applying it to transactional pricing, especially in B2B enterprises, is extremely difficult. Some price