17-1 pricing of services three key ways that service prices are different for consumers approaches...

17-1

Pricing of Services

Three Key Ways that Service Prices Are Different for Consumers

Approaches to Pricing Services

Pricing Strategies that Link to the Four Value Definitions

ChapterChapter

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17-2

Pricing Quiz

Which dentist would you choose for a filling in your tooth?Dentist Cost for

FillingDistance to Dentist

Wait Period for an

Appointment

Time in Waiting Room

Anesthesia

A $50 15 miles 3 Weeks 1.5 hour None

B $75 15 miles 1 Week .5 hour Novocain

C $125 3 miles 1 Week 1 hour Novocain

D $200 3 miles 1 Week No wait Nitrous Oxide

& Novocain

17-3

Customers Often Lack Knowledge of Service Prices

Customers often lack reference prices for service

Service variability limits knowledgeProviders are unwilling to estimate prices Individual customer needs varyCollection of price information by customers

is difficult Prices are not visible

17-4

The Role of Non-monetary Price

Time costs Search costs Convenience costs Psychological costs

Do you trade time for money?

17-5

Price as an Indicator of Service Quality

Can price attract somecustomers?

17-6

Price as an Indicator of Service Quality

Infers Low Quality Service

Infers High Quality Service

17-7

Three Basic Marketing Price Structures and Challenges for Services

17-8

A Customer-Focused Approach to The Pricing Process

17-9

Four Customer Definitions of Value

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Pricing Strategies When the Customer Defines Value as Low Price

17-11

Pricing Strategies When the Customer Defines Value as Everything Wanted in a Service

17-12

Pricing Strategies When the Customer Defines Value as Quality for the Price Paid

17-13

Pricing Strategies When the Customer Defines Value as All that Is Received for All that Is Given