• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Pricing strategies that Virgin Blue Airline could use.

Extracts from this document...

Introduction

Virgin Blue Virgin Blue is the creation of Sir Richard Branson, founder and CEO of the Virgin Group. The airline carrier was launched in 2000 by Sir Richard Branson and the Virgin Blue CEO Brett Godfrey, to enter the Australian market. Initially set up as a low fare carrier, the company only flew between Brisbane and Sydney. Since then, it has become Australia's second largest airline, catering for all major cities in Australia. Customers pay for their in-flight meals and drinks. To further cut costs, Virgin Blue uses a system of e-ticketing (a telephone and internet based ticketing system). a) Describe three potential pricing strategies that airline companies can adopt when entering a new market. ...read more.

Middle

Penetration pricing will cost the business revenue, but I the long term will pay off. Clients will be satisfied with the low prices and with keep their brand loyalty for a good time. In the future the company will have to raise their prices again, in order not to make a loss and maybe then they will lose some customers but not a lot. * Last but not least, companies could use Price discrimination This is where a business charges different prices for different types of users (or segments of the market). Where there's the holiday season, the company charges higher prices, due to its high demand and when the demand is low due to school and work time prices will go down to attract more customers. This helps the company to maximise revenue. ...read more.

Conclusion

* To increase their sales revenue, companies could use Creaming strategy is a strategy that the company can adopt. Selling tickets at a high price, sacrificing high sales to gain a high profit, therefore 'skimming' the market. Usually employed to reimburse the cost of investment of the original research into the tickets. High prices, meaning high quality, it will attract customers that are looking for luxury services, better food, better flight conditions, etc.. * Premium pricing will keep the price of the airplane tickets pretty high in order to encourage favorable perceptions among customers, only due to the price imposed on the tickets. This strategy is made to attract the most desirable clients, theres a tendency for buyers to assume that expensive items are an exceptional reputation or represent exceptional quality and distinction from other flight companies. (8 marks) ?? ?? ?? ?? Tom�s Ferreira ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our International Baccalaureate Business Studies section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related International Baccalaureate Business Studies essays

  1. Orgnizationl, Theory, Change & Culture

    After mention overview for both organizations Johnson & Johnson and Dow Corning, I am going to analyze the case study in page 57 in text book, which is an ethical stance at Johnson & Johnson and Dow Corning. As the behavior of Johnson & Johnson's, Dow Corning's, and Arthur Andersen's

  2. Analysing Job sectors in Canada. Identify trends in employment and occupational demand patterns for ...

    The days of reliance on manufacturing jobs are limited as the economy continues to shift toward service-and knowledge-based jobs. A further specialization of labour is anticipated but nonetheless. The challenges experienced by Canadian manufacturers in the past few years are a subject of public policy interest.

  1. Thai Tuan Textile Company, Vietnam - Marketing Strategies

    Obviously, most of people philosophy was "An chac mac ben", meant that I cared my foods in quantity rather than quality, I bought my clothes if they could be used in long time rather than fashionable. A decade later, people income was remarkably increased plus a wide integration with the world.

  2. The opportunity exists whereby RDB Palace, a low budget hotel, can differentiate itself to ...

    It is looking at the marketing strategies in order to reach that level. At present it finds itself in a low budget hotel category but due to the increase in the number of budget hotels and increased competition, the management feels to differentiate itself and create a brand name in the city.

  1. Steroid Use in Baseball

    Any subsequent positive test result by a Player results in the Commissioner imposing further discipline on the Player. Clearly, these penalties are too lien for players with salaries of millions of dollar a year. I think the fine should begin with the first offense with a one year suspension and a $100,000 suspension.

  2. Employment Discrimination- An Introduction

    Tackling this problem will prove to be a challenge, for laws are not a wholly efficient method of eradicating employment discrimination. For every form of discrimination covered by the law, another one appears. An open minded education for individuals that encompasses many different cultures and strives to eliminate as much

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work