Creating a viable service requires a business model that allows for the costs of creating and delivering the service, in addition to a margin for profits, to be recovered through realistic pricing and revenue management strategies. However, the pricing of services is complicated. Pricing Services and Revenue Management explains how to set an effective pricing and revenue management strategy that fulfils the promise of the value proposition so that a value exchange takes place. This book is the fourth volume in the Winning in Service Markets Series by services marketing expert Jochen Wirtz. Scientifically grounded, accessible and practical, the Winning in Service Markets Series bridges the gap between cutting-edge academic research and industry practitioners, and features best practices and latest trends on services marketing and management from around the world.
Table of Contents
Effective Pricing is Central to Financial Success 9
Objectives for Establishing Prices
Pricing Strategy Stands on Three Foundations 13
Reducing Related Monetary and Non-monetary Costs
Revenue Management: What It Is and How It Works 25
Reserving Capacity for High-yield Customers
How can we Measure the Effectiveness of a Firm's Revenue Management?
How does Competitor's Pricing Affect Revenue Management?
Designing Rate Fences
Fairness and Ethical Concerns in Service Pricing 36
Service Pricing is Complex
Piling on the Fees
Designing Fairness into Revenue Management
Putting Service Pricing Into Practice 45
How Much to Charge?
What Should be the Specified Basis for Pricing?
Who Should Collect Payment and Where Should Payment be Made?
When Should Payment be Made?
How Should Payment be Made?
How Should Prices be Communicated to the Target Markets?
About the Author 64