Real Pricing Choices at Disney
One of the decisions Disney is facing is how to maximize revenue while also maximizing the customers’ experience. It also wants to remain dominant in an industry which is increasing competitive and dynamic. The company seeks to enhance the customer experiences by reducing overcrowding as well as shortages of customers. It aims to achieve this by adjusting prices in accordance with prevailing market demand. The decision would maximize revenue through increasing price elasticity of demand and thus when demand increases, the price rises. Further, when the demand for ticket falls prices drop and facilitates an increase in the number of customers particularly the price sensitive ones.
Understanding the customers, needs such as the services and products they need and whether they are driven by the value or by the lowest price is one of the vital considerations in making the pricing decision. The positioning of a brand in the market is also a critical factor as luxurious brands would need to set prices that would attract their ideal customers. The trends in the industry, particularly the practices of the leading competitors are also vital in benchmarking, as well as providing critical information on the level of service customers expect. For, example Universal Studios has been using demand-based pricing.
Competitor-based pricing, seasonal pricing and promotions and value-based pricing are some of the alternativ…
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