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THREE WAYS PRICING OF SERVICES ARE
DIFFERENT
• Customer Knowledge of Service Prices
• Reference points for prices are less accurate for services

• The role of non-monetary costs

• Customers will trade money for other service costs

• Price is an indicator of service quality

• Price can be a surrogate indicator where quality is hard to detect or where
prices vary greatly.
CUSTOMERS WILL TRADE MONEY FOR OTHER
SERVICE COSTS
WHICH DENTIST WOULD YOU CHOOSE?
PRICE AS AN INDICATOR OF SERVICE QUALITY
THREE BASIC MARKETING PRICE STRUCTURES
AND CHALLENGES FOR SERVICES
HOW DOES PRICE RELATE TO SERVICE VALUE?

 What is service value?

 Mental tradeoff of perceived quality and
perceptions of sacrifice
 Can include both monetary and non-monetary
sources of sacrifice
 But it may mean different things to different
people!
FOUR CUSTOMER DEFINITIONS OF VALUE
PRICING STRATEGIES FOR DIFFERENT
DEFINITIONS OF VALUE
IMPORTANT PRICING ISSUES
• How much should be charged?
• What should be the basis of pricing?
• Who should collect payment?
• Where should payment be made?
• When should payment be made?
• How should prices be communicated to the target
market?
ETHICAL CONSIDERATIONS IN SERVICE PRICING
• Service pricing is complex.

• Not piling on the fees.

• Not exploiting customer ignorance.

• Designing fairness into revenue management.