Blended Rate

Published Aug 10, 2023

Definition of Blended Rate

A blended rate is a pricing strategy that combines two or more different rates into one. That means it is a combination of different prices for different products or services that are offered by the same company. This strategy is often used by companies to simplify their pricing structure and make it easier for customers to understand.

Example

Consider a streaming service that provides two subscription plans: Basic and Premium. The Basic plan costs $10 per month and offers limited content access, while the Premium plan costs $20 per month and provides access to a wider range of content, including exclusive shows and movies. To simplify their pricing and attract more customers, the streaming service introduces a blended rate of $15 per month. This means that subscribers can enjoy the features of the Premium plan at a discounted price compared to the original $20 cost, making it an attractive option for those who want more content without paying the full premium price.

Why Blended Rate Matters

Blended rates are a great way for companies to simplify their pricing structure and make it easier for customers to understand. By combining different rates into one rate, companies can make their pricing more transparent and reduce customer confusion. In addition, blended rates can also help companies to increase their sales by making their products or services more attractive to customers.