Case Study Of Revenue Management Of Gondolas

1124 Words 5 Pages
Register to read the introduction… What revenue impact would this have?
In the case, previous design modifications to the Gondola were made in order facilitate the high increase in demand. In retrospect, we can suggest the same strategy to solve the dilemma of how to increase the capacity in Gondolas. Lovelock (2015, p.193) states that “the primary capacity constraint is likely to be defined in terms of such furnishings as beds, rooms or seats,” Indicating the source of the problem. The solution, redesign, increases the limit of passengers thus increasing capacity. An adjustment strategy used to oversee this implementation is known as chasing demand. The action to be used from strategy would be one Lovelock (2015, p.195) defines as “Schedule of downtime during periods of low demand”. During this period, the Gondolas could undergo the redesign, construction and modification, ensuring the demand can be met at its highest periods. Another strategy if the redesign is not successful is decreasing the allocation of time spent on the ride. This will facilitate demand as the number of rides offered will be increased
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Is it possible? If so what would you recommend?
A business achieving revenue maximisation whilst balancing any other factor must understand complications can be evident. This does not mean it is impossible as it is indeed possible, however it emphasises that a well implemented strategy must be applied. To effectively apply revenue management inclusions of; high fixed cost structures, fixed capacity, variable and uncertain demand and varying customer price sensitivity. To do this a business must; design price schedules and fences that are clear and logical, building to hide discounts, loyal customer care, and service recovery for overbooking and higher published price and frame fences as discount. These fences as Lovelock (2015, p.176) defines are “either physical or non-physical” and “Physical fences refer to tangible product differences related to the different prices, such as the seat location”. With theory in mind, the balance can be obtain in many different ways. These suggestions are; increasing night tours resulting in revenue increase and cultural heritage experience on grand gondola through the most romantic city. Increased offer of training, providing it to the public and those members who meet the criteria, resulting in gaining the experience and opportunity to become a Gondolier. Selling seasonal flowers and decoration of lights, creating a romantic atmosphere and offering
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We are also understand price is established through negotiation or it is up to the tour operators. The main process the consumers take to purchase gondola tickets are through tour operators and figures up to eighty percent. Their pricing differentiates from the former and can be seen as discounted. 35 euros to 70 euros over a fifty minute ride. Given the above to make any changes and have and effective pricing strategy that bring financial success their needs to be proficient understanding of costs, value and

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