Essay about Pricing Strategy

2200 Words Nov 3rd, 2013 9 Pages
Pricing Strategy for Wellness, Inc.Prepared by Marlowe K. Blackwell | How can Wellness, Inc.best use Price Discrimination to increase revenue? | This document will identify, compare and analyze various pricing models currently used by competitors and recommend a pricing strategy for Wellness, Inc. to increase revenue and maximize profit. |
8/12/2013
8/12/2013

Outline 1. Introduction

2. Background of Wellness, Inc. a. Type of business b. Market segment

3. Background of Industry

4. Wellness, Inc.’s current pricing model

5. Comparison Competitor pricing models: c. Massage Envy- two part tariff d. Rubs – two part tariff e. Massage Goat – third degree f. Massage
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WELLNESS, INC. sees that applying the appropriate price discrimination in its pricing model, it could capture different segments and client reservation price to maximize profits.

Wellness, Inc., Inc. Background
WELLNESS, INC., originally started with one massage therapist in 2005, located within Dixon and Co. with client referrals from the hair stylist from Dixon and Co. whose target segment the same as WELLNESS, INC.’s current target segment. In 2008 Dixon and Co. closed its doors and WELLNESS, INC. and the other stylists moved into sublet space within Salon 101. Since WELLNESS, INC.’s beginnings WELLNESS, INC. has been a referral business only targeting clients of the hair salon. In late 2012 WELLNESS, INC. used the marketing venue Living Social to attract clients outside of the Salon, this proved to be effective in the short-term as massage services were offered at 50% off regular pricing. Through this three day promotion, WELLNESS, INC. experienced an increase of exposure through website traffic from approximately 100 visitors to 4,000 visitors. At the time, WELLNESS, INC. added an additional massage therapist. The promotion yielded 75 new clients with only five rebooked/recurring clients.
In 2012 WELLNESS, INC. did another promotion with Groupon offering 50% off regular pricing. Through this three day promotion, WELLNESS, INC. experienced

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