Understanding and enhancing price fairness perceptions of value-based pricing

Value-based pricing is potentially beneficial for relationships in business markets, but customers may also perceive this pricing approach as unfair. Drawing on the dual entitlement principle, we find that pricing norms play a role in fairness perceptions of value-based
pricing. We find that fairness perceptions of
value-based pricing can be enhanced by
transparent and consistent sharing of cus-
tomer value. Explicitly applying the identical
value-sharing rule when promising customer value ex-ante and achieving it ex-post significantly increases price fairness perceptions. We find the same effect when applying the identical value-sharing rule for the focal customer and other customers, even if this leads to higher prices for the focal customer. This study shows specific ways how the dual entitlement principle forms price fairness perceptions