1. Chapter 17
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

2. Wait Period for an Appointment
Pricing Quiz
Which dentist would you choose for a filling in your tooth?
Dentist
Cost for Filling
Distance to Dentist
Wait Period for an Appointment
Time in Waiting Room
Anesthesia A
$50
15 miles
3 Weeks
1.5 hour
None B
$75
1 Week
.5 hour
Novocain C
$125
3 miles
1 hour D
$200
No wait
Nitrous Oxide
& Novocain

3. Customers Often Lack Knowledge of Service Prices
Customers often lack reference prices for service
Service variability limits knowledge
Providers are unwilling to estimate prices
Individual customer needs vary
Collection of price information by customers is difficult
Prices are not visible

4. The Role of Non-monetary Price
Time costs
Search costs
Convenience costs
Psychological costs
Do you trade time for money?

5. Price as an Indicator of Service Quality
Can price attract some customers?

6. Price as an Indicator of Service Quality
Infers High Quality Service
Infers Low Quality Service

7. Three Basic Marketing Price Structures and Challenges for Services

8. A Customer-Focused Approach to The Pricing Process
Understand Customer Value
Determine Demand based on Competition and Offering
Estimate Cost, Revenues and LTV
Establish a Pricing Structure and Level
Set Final Price

9. Four Customer Definitions of Value

10. Pricing Strategies When the Customer Defines Value as Low Price

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

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

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