An important part of the marketing research and decision process includes setting a realistic price. From the seller's point of view, the higher the price, the more profit it will make. From the buyer's point of view, the lower the price, the more money they will keep in their pockets. Since these are ultimately two opposing concepts, the key to a successful exchange will be to set a price which is appealing to both sides. In this module, you learn about several pricing strategies, including pricing based on cost, demand, competition, customer's needs and new product pricing. 

 

For many service organizations, such as restaurants, hotels, airlines, and resorts, pricing strategies are particularly important because of the perishability of services (that is, services can't be stored). Pricing is a vital part of effective marketing strategies, which ensures that a maximum number of seats of the plane or rooms in the hotel are purchased—every day.

 

For this discussion, pretend you are the owner of a new seaside resort complex that offers vacationers luxury villas, available for rent for a few days, a week, or longer. 

• Consider possible pricing strategies such as cost-plus, yield management, demand based pricing, price skimming, penetration, trial pricing, bundling, etc.
• After reviewing these concepts in your text, select two (2) and describe how and why you might utilize these pricing strategies with your new resort. Note, not all of these concepts would be applicable for a luxury seaside villa.

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