Which pricing strategy seeks to adjust prices based on varying customer value perceptions?

The correct answer is psychological pricing, as this strategy focuses on setting prices based on the perceived value that customers associate with a product or service. It leverages psychological factors to encourage consumer purchasing decisions, using pricing tactics that appeal to the emotional and cognitive responses of customers.

For instance, prices that end in .99 may suggest a better deal, while higher-priced items may create a perception of higher quality. This strategy recognizes that customers do not always make rational decisions based solely on cost but are influenced by how they perceive value. By aligning pricing with customer perceptions, businesses can optimize sales and enhance market positioning.

In contrast, price discrimination typically involves charging different prices to different consumers based on their willingness to pay, which doesn't necessarily relate to a broader psychological framework. An extension strategy involves expanding the product line or entering new markets rather than adjusting prices based on value perceptions. Bidding strategy relies on competitive offers, usually in an auction format, which may not focus heavily on perceived value but rather on the competitive landscape and pricing tactics of other bidders.