Hospitality Marketing Test 4

Contractual VMS

A contractual VMS consists of independent firms at different levels of production and distribution who join through contracts to obtain economies or sales impact Franchising Franchising is a method of doing business by which a franchisee is granted the right to engage in offering, selling, or distributing goods or services under a marketing format which is designed by the franchisor The franchisor permits the franchisee to use its trademark, name, and advertising. For the right to use the name, methods of operation, and other benefits that come with a franchise, the franchisee pays an initial fee, a royalty, and a marketing fee to the franchise organization Alliances Another form of contractual agreement, are developed to allow two organizations to benefit from each other's strength Alliances by two or more noncompeting firms are a popular and effective way of expanding markets For example, restaurants are developing alliances with convenience stores and hotel properties to distribute their products

Franchise

A contractual vertical marketing system in which a channel member called a franchiser links several stages in the production distribution process The franchisee is granted the right to offer, sell, and distribute goods and services under a marketing format designed by the franchisor

Distribution Channel Functions

A distribution channel moves goods from producers to consumers Members of the marketing channel perform many key functions (The first five functions help complete transactions; the last three help fulfill the completed transactions): Information Gathering and distributing marketing research and intelligence information about the marketing environment Promotion Developing and spreading persuasive communications about an offer Contact Finding and communicating with prospective buyers Matching Shaping and fitting the offer to the buyer's needs, including such activities as manufacturing, grading, assembling, and packaging Negotiation Agreeing on price and other terms of the offer so that ownership or possession can be transferred Physical distribution Transporting and storing goods Financing Acquiring and using funds to cover the costs of channel work Risk taking Assuming financial risks such as the inability to sell inventory at full margin

Vertical Marketing Systems (VMS)

A distribution channel structure in which producers, wholesalers, and retailers act as a unified system: either one channel member owns the others, or has contracts with them, or has so much power that they all cooperate.

Channel Levels

A level of middleman that performs some work in bringing the product and its ownership closer to the final buyer

Direct Marketing Channel

A marketing channel that has no intermediary levels

Service Culture

A system of values and beliefs in an organization that reinforces the idea that providing the customer with quality service is the principal concern of the business Supports customer service through policies, procedures, reward systems, and actions

Survival

A technique used when a company's sales slump, creating a loss that threatens its existence In the short run, survival is more important than profits Because the capacity of a hotel or restaurant is fixed, survival often involves cutting prices to increase demand and cash flow

Online Travel Agent (OTA)

A travel agency that conducts business through the Internet with no physical locations or stores

Contractual VMS

A vertical marketing system in which independent firms at different levels of production and distribution join together through contracts to obtain more economies or sales impact than they could achieve alone

Corporate VMS

A vertical marketing system that combines successive stages of production and distribution under single ownership. Channel leadership is established through common ownership.

Administered VMS

A vertical marketing system that coordinates successive stages of production and distribution, not through common ownership or contractual ties, but through the size and power of one of the parties

Broker

A wholesaler who does not take title to goods and whose function is to bring buyers and sellers together and assist in negotiations

Agent

A wholesaler who represents buyers or sellers on a more permanent basis, performs only a few functions, and does not take title to goods

Alliances

Alliances are developed to allow two organizations to benefit from each other's strengths Often used by hotels and restaurants to gain access to new, international markets by forming and alliance with a company from that country

Competition-Based Pricing

Also referred to as "Going-rate Pricing" Based on the establishment of price largely against those of competitors, with less attention paid to costs or demand May charge the same, more, or less, depending on the company's strategy

Establishment of a service Culture

An internal marketing program flows out of a service culture A service marketing program is doomed to failure if its organizational culture does not support serving the customer An internal marketing program requires a strong commitment from management Service culture A culture that supports customer service through policies, procedures, reward systems, and actions Organizational culture The pattern of shared values and beliefs that gives members of an organization meaning, providing them with the rules for behavior in the organization

Marketing Objectives

Before establishing price, a company must select a product strategy Pricing may play an important role in helping accomplish the company's objective at many levels Survival Companies troubled by too much capacity, heavy compensation, or changing consumer wants set survival as their objective In the short run, survival is more important than profit This strategy directly affects immediate competitors and sometimes the entire industry Current profit maximization Many companies want to set a price that will maximize current profits They estimate what demand and costs will be at different prices and choose the price that will produce the maximum current profit, cash flow, or return on investment, seeking current financial outcomes rather than long-run performance Market-share leadership Some companies want to obtain a dominant market-share position They believe that a company with the largest market share will eventually enjoy low costs and high long-run profit Thus prices are set as low as possible Product-quality leadership For example: Groen, a manufacturer of food-service equipment, is known for its high-quality steam-jacketed kettles Kitchen designers specify Groen equipment because of its known quality, enabling the company to demand a high price for its equipment To maintain its quality, Groen must have a well-engineered product comprised of high-quality materials It also must have the budget to ensure that it maintains its position as a quality leader Other objectives A company also might use price to attain other, more specific objectives For example, a restaurant may set low prices to prevent competition from entering the market or set prices at the same level as its competition to stabilize the market

Retailer

Business whose sales come primarily from retailing

Hiring and Training

Cast Members A term used for employees. It implies that employees are part of a team that is performing for their guests Cross-training Training employees to do two or more jobs within the organization

Price Adjustment Strategies

Companies usually adjust their basic prices to account for various customer differences and changing situations Discount pricing and allowances Volume discounts Most hotels have special rates to attract customers who are likely to purchase a large quantity of hotel rooms, either for a single period or throughout the year Discounts based on time of purchase Seasonal discounts allow the hotel to keep demand steady throughout the year Discriminatory pricing Discriminatory pricing refers to segmentation of the market and pricing differences based on price elasticity characteristics of these segments Price discrimination as used in this chapter is legal and viewed by many as highly beneficial to the consumer In discriminatory pricing, the company sells a product or service at two or more prices, although the difference in price is not based on differences in cost Price discrimination works to maximize the amount that each customer pays Revenue Management [Slide 11-17] One application of discriminatory pricing is revenue management Revenue management involves upselling, cross-selling, and analysis of profit margins and sales volume for each product line Revenue management system is used to maximize a hospitality company's yield or contribution margin An effective revenue management system establishes fences to prohibit customers from one segment receiving prices intended for another

Vertical Conflict

Conflict between different levels of the same channel

Horizontal Conflict

Conflict between firms at the same level

Supply Chain

Consists of Upstream & Downstream partners Upstream partners are firms that supply what is needed to create a product or service Downstream partners connect the firm with its customers A better approach is to think of the supply chain as a Value Delivery Network where all parties partner with each to improve the performance of the entire system

Dynamic Pricing

Continually adjusting prices to meet the characteristics and needs the marketplace When demand increases or capacity is reduced due to previous sales, prices increase, and the reverse is also true Ex. Uber's surge pricing

Dynamic Pricing

Continually adjusts prices to meet the characteristics and needs the marketplace. When demand increases or capacity is reduced due to previous sales, prices increase and the reverse is also true.

Cost Base Pricing

Cost-plus pricing: Adding a standard markup to the cost of the product It is the simplest and one of the most popular pricing method Sellers are more certain of costs than demand

Marketing Approach to HR

Creating Jobs That Attract Good People Managers must use the principles of marketing to attract and retain employees They must research and develop an understanding of their employees' needs, just as they examine the needs of customers The Hiring Process Service organizations need to hire for attitude and train for skills Finding employees who are good at creating a service experience is a vital goal and major hiring criterion of service organizations Careful selection can also have a positive effect on the employees that are hired because they feel special Teamwork If a company hires the right people, they will be team players In companies that practice internal marketing, if one employee makes an error, other employees try to cover it before the guest notices Organizations that lack teamwork create an uncomfortable environment for the guest The Importance of Initial Training If we hire right employees and provide good training, we will be well on the way to having enthusiastic employees create repeat guests Continuous Training Two principal characteristics have been identified in companies that lead their industries in customer service They emphasize cross-training They insist that everybody share certain training experiences Companies must make sure that their employees are familiar with all the products the organization sells Properly trained employees can deliver quality service, which helps the image of the firm, attracting more guests and employees to the organization Managing Emotional Labor Just as we try to understand the needs of our customers, we need to understand the needs of our employees Emotional labor is the necessary involvement of the service provider's emotions in the delivery of the service Implementation of a Reward and Recognition System To sustain a service culture, human resource policies must create a system that rewards and recognizes employees and managers that provide good customer service

Management Commitment

Developing a customer-oriented organization requires a commitment from management of both time and resources

Major Hospitality Distribution Channels

Direct booking On average, reservations received directly at the hotel account for 54.3% of a hotel's reservations, but only 46.5% of the revenue. Managers often like to encourage direct booking because of the low transaction costs Online Travel Agencies (OTA) Online travel agencies only account about 6.5% of a hotel's reservation One way of dividing OTAs is into opaque and non-opaque The non-opaque OTAs includes merchant, retail and referral models The most popular non-opaque sites are merchant agencies which collect payment from the customer and include well-known names like Hotels.com, Travelocity and Expedia Opaque sites reduce cannibalization of brand.com by not disclosing the brand and specific hotel one is purchasing until it is purchased in a nonrefundable transaction with the consumer When using opaque OTAs one should consider that it can reduce the perceived value for those who purchase through brand.com, if people in the same hotel discuss what they paid for the room It can also bring in price sensitive guests that will not spend money on food and beverage One important feature of an OTA is people often search through hotel choices and then go to brand.com to book the reservation Thus, it is important that the hotel have a good presence in terms of photos and description on the OTA Another type of OTA is a retail agency, which is similar to a conventional travel agency The hotel pays a commission to the agent and collects the mono the room rental directly from the guest Global Distribution Systems Global distribution systems (GDSs) are computerized reservation systems that serve as a product catalog for travel agents and other distributors of hospitality products Travel Agents One way of reaching a geographically diverse marketplace is through travel agent The number of travel agents has been decreasing in recent years due to the growth of direct booking and customers self-booking travel on the Internet Tour Wholesalers Tour wholesalers assemble travel packages usually targeted at the leisure market These generally include transportation and accommodations but may include meals, ground transportation, and entertainment In developing a package, a tour wholesaler contracts with airlines and hotels for a specified number of seats and rooms, receiving a quantity discount The wholesaler also arranges transportation between the hotel and the airport

Channel Conflict

Disagreement among marketing channel members on goals and roles—who should do what and for what rewards

Two Hypothetical Demand Schedules

Each price a company can charge leads to a different level of demand The demand curve illustrates the relationship between price charged and the resulting demand It shows the number of units the market will buy in a given period at different prices that might be charged In the normal case, demand and price are inversely related: The higher the price, the lower the demand Most demand curves slope downward in either a straight or a curved line For prestige goods, the demand curve sometimes slopes upward

Evaluating Channel Alternatives

Economic Feasibility of the Channel Member Each channel produces different levels of sales and costs The business that channel members bring must offset the cost of paying and supporting the channel member These costs are measured two ways Directly By opportunity costs A company must regularly evaluate the performance of its intermediaries As business changes, the value of an intermediary may change Control Criteria An important consideration in the choice of channels is control Control is also an important consideration in franchising and choosing multiple channel members

Manage Emotional Labor

Emotional Labor The necessary involvement of the service provider's emotions in the delivery of the service Often, the most effective way of communicating with customers is through customer-contact employees

External Factors

External factors that affect pricing decisions include: The Nature of the Market and Demand Competition Other environmental elements Market and Demand Although costs set the lower limits of prices, the market and demand set the upper limit Both consumer and channel buyers such as tour wholesalers balance the product's price against the benefits it provides Thus, before setting prices, a marketer must understand the relationship between price and demand for a product Cross-Selling and Upselling Cross-selling opportunities abound in the hospitality industry For example, a hotel can cross-sell food and beverage (F&B), exercise room services, and executive support services, and it can even sell retail products ranging from hand-dipped chocolates to terry-cloth bathrobes Upselling involves training sales and reservations employees to continuously offer a higher-priced product, rather than settling for the lowest price Consumer Perceptions of Price and Value In the end, it is the consumer who decides whether a product's price is right When setting prices, management must consider how consumers perceive price and the ways that these perceptions affect consumers' buying decisions Like other marketing decisions, pricing decisions must be buyer oriented Consumers tend to look at the final price and then decide whether they received a good value

Factors Affecting Price Sensitivity

Factors that affect price sensitivity: Unique value effect Creating the perception that your offering is different from those of your competitors avoids price competition. In this way the firm lets the customer know it's providing more benefits and offering a value that is superior to that of competitors, one that will either attract a higher price or more customers at the same price Substitute awareness effect The existence of alternatives of which buyers are unaware cannot affect their purchase behavior When consumers discover products offering a better value, they switch to those products Business expenditure effect When someone else pays the bill, the customer is less price-sensitive When setting rates, management needs to know what the market is willing to pay End-benefit effect Customers are more price-sensitive when the price of the product accounts for a large share of the total cost of the end benefit The end-benefit price identifies price-sensitive markets and provides opportunities to overcome pricing objections when the product being sold is a small cost of the end benefit Total expenditure effect The more someone spends on a product, the more sensitive they are to the product's price The total expenditure effect is useful in selling lower-price products or products that offer cost savings to volume users Price quality effect Consumers tend to equate price with quality, especially when they lack any prior experience with the product Hidden Fees The hospitality industry is known for charging hidden fees or fees that guest has to pay use the product that are not included in the basic price. In order to avoid angry guests and embarrassment, it is important to keep such fees transparent to the guest before reaching the point of paying for the bill.

Wholesaler

Firms engaged primarily in wholesaling activity

Costs

Fixed Costs Do not vary with production or sales level Variable Costs Vary directly with the level of production Total Costs Costs that are the sum of the fixed and variable costs for any given level of production

Vertical Marketing Systems

For the channel as a whole to perform well, each channel member's role must be specified, and channel conflict must be managed The channel will perform better if it includes a firm, agency, or mechanism that provides leadership and has the power to assign roles and manage conflict. Vertical marketing system (VMS) consists of producers, wholesalers, and retailers acting as a unified system One channel member owns the others, has contracts with them, or wields so much power that they must all cooperate The VMS can be dominated by the producer, the wholesaler, or the retailer Corporate VMS Coordination and conflict management are attained through common ownership at different levels in the channel A corporate VMS combines successive stages of production and distribution under single ownership Administered VMS Coordinates successive stages of production and distribution not through common ownership or contractual ties but through the size and power of the parties Contractual VMS Consists of independent firms at different levels of production and distribution who join through contracts to obtain economies or sales impact

Revenue Management

Forecasting demand to optimize profit Demand is managed by adjusting price Fences are often built to keep all customers from taking advantage of lower prices. For example, typical fences include making a reservation at least two weeks in advance or staying over a Saturday night

Rate Parity

Hotel Rate Parity is a controversial strategy that has been challenged in court and survived. It is essentially a strategy in which hotel chains agree to allow their product (rooms) to be shown and sold on OTAs (Online Travel Agencies) provided the prices they offer are the same and are not lower than the hotel's BAR (Best Available Rate).

Price Changes

Initiating Price Changes (Inevitably!) After developing their price structures and strategies, companies may face occasions when they want to cut or raise prices Initiating Price Cuts Several situations may lead a company to cut prices - one is excess capacity Companies may also cut prices in a drive to dominate the market or increase market share through lower costs Either the company starts with lower costs than its competitors, or it cuts prices in the hope of gaining market share through larger volume Initiating Price Increases Inevitably many companies must eventually raise prices They do this knowing that price increases may be resented by customers, dealers, and their own sales force However, a successful price increase can greatly increase profits In passing price increases on to customers, the company should avoid the image of price gouger It is best to increase prices when customers perceive the price increase to be justified Price increases should be supported with a company communication program informing customers and employees why prices are being increased

Factors to Consider When Setting Prices

Internal and external company factors affect a company's pricing decisions Internal factors include the company's marketing objectives, marketing mix strategy, costs, and organizational considerations (See Slide 6) External factors include the nature of the market, demand competition, and other environmental elements (See Slide 7)

Internal Factors

Internal factors include the company's marketing objectives, marketing mix strategy, costs, and organizational considerations Marketing Objectives Before establishing price, a company must select a product strategy If the company has selected a target market and positioned itself carefully, its marketing mix strategy, including price, will be more precise Marketing Mix Strategy Price is only one of many marketing mix tools that a company uses to achieve its marketing objectives Price must be coordinated with product design, distribution, and promotion decisions to form a consistent and effective marketing program Decisions made for other marketing mix variables may affect pricing decisions A firm's promotional mix also influences price Companies often make pricing decisions first Other marketing mix decisions are based on the price a company chooses to charge Costs Costs set the floor for the price a company can charge for its product A company wants to charge a price that covers its costs for producing, distributing, and promoting the product Beyond covering these costs, the price has to be high enough to deliver a fair rate of return to investors Total costs are the sum of the fixed and variable costs for any given level of production In the long run, management must charge a price that will at least cover total costs at a given level of sales Organizational Considerations Management must decide who within the organization should set prices Companies handle pricing in a variety of ways In small companies, top management, rather than the marketing or sales department, often sets the prices In large companies, pricing is typically handled by a corporate department or by regional or unit managers, under guidelines established by corporate management Many corporations within the hospitality industry now have a revenue management department with responsibility for pricing and coordinating with other departments that influence price

Internal Marketing Process

Internal marketing ensures that employees at all levels of the organization experience the business and understand its various activities and campaigns in an environment that supports customer consciousness The objective of internal marketing is to enable employees to deliver satisfying products to the guest Internal marketing is a process that involves the following steps: Establishment of a service culture Development of a marketing approach to human resource management Dissemination of marketing information to employees

Internal Marketing

Involves marketing to the firm's internal customers, its employees

Determinants of Price Elasticity

Marketers also need to understand the concept of price elasticity, how responsive demand will be to a change in price If demand hardly varies with a small change in price, we say that the demand is inelastic If demand changes greatly, we say the demand is elastic % Change in Quantity Demand = % Change in Price Price Elasticity of Demand What determines the price elasticity of demand? Buyers are less price-sensitive when: The product is unique The product is high in quality, prestige, or exclusiveness Substitute products are hard to find

Multichannel Marketing Distribution

Multichannel distribution, as when a single firm sets up two or more marketing channels to reach one or more customer segments

Moment of truth

Occurs when an employee and a customer have contact

Business Location

One of the most important aspects of distribution for hospitality organizations is location In general, there are four steps in choosing a location Understanding the marketing strategy and target market of the company Conducting a regional analysis Involves the selection of geographic market areas Selecting an area within that region Choosing individual sites A key consideration in site analysis is compatible businesses A restaurant or hotel will look for potential demand generators A firm also looks at competitors Site evaluation includes accessibility

Break-Even Pricing

Price is set to break even on the costs of making and marketing the product; or to make a desired profit Break-Even = Fixed Costs Contributions (Selling Price-Variable Costs)

Existing Product Pricing Strategies

Product-Bundle Pricing Sellers who use product-bundle pricing combine several of their products and offer the bundle at a reduced price Price bundling has two major benefits to hospitality and travel organizations Customers have different maximum prices or reservation prices they will pay for a product The price of the core product can be hidden to avoid price wars or the perception of having a low-quality product Price-Adjustment Strategies Companies usually adjust their basic prices to account for various customer differences and changing situations (See Slide 15)

Product Bundle Pricing

Product-Bundling Seller combines several products and offers the bundle at a reduced price Dynamic Packaging A package vacation on a single website where buyers can put together airline flights, lodging, car rental, entertainment, and tours in their own customer-designed packages

Psychological Pricing

Psychological pricing considers the psychology of prices, not simply the economics Prestige can be created by selling products and services at a high price. Another aspect of psychological pricing is reference prices Reference Prices are prices that buyers carry in their minds and refer to when they look at a given product A buyer's reference price might be formed by noting current prices, remembering past prices, or assessing the buying situation Price Endings While dollar pricing is most commonly used by hotels, in the case of lower rated hotels, odd ending prices are more common, because customers tend to simplify price information by ignoring end figures. Promotional Pricing When companies use promotional pricing, they temporarily price their products below list price and sometimes even below cost Value Pricing Value pricing means offering a price below competitors permanently, which differs from promotional pricing, in which price may be temporarily lowered during a special promotion Value pricing is risky if a company does not have the ability to cut costs significantly It is usually most appropriate for companies able to increase long-run market share through low prices (Taco Bell) or niche players with a lower-cost operating basis who use price to differentiate their product (Southwest Airlines)

Overbooking

Revenue management continues to provide great service to the hospitality industry. Nevertheless, occasionally there are problems with overbooking, which can create guest/passenger dissatisfaction. When overbooking occurs, the supplier has an ethical and legal responsibility to compen-sate the buyer and/or find alternative flights, hotels, etc.

New Product Pricing Strategies

Several options exist for pricing new products: prestige pricing, market-skimming pricing, and market-penetration pricing Prestige Pricing For example, hotels or restaurants seeking to position themselves as luxurious and elegant enter the market with a high price to support this position Market-Skimming Pricing Price skimming is setting a high price when the market is price-insensitive Price skimming can make sense when lowering the price will create less revenue Price skimming can be an effective short-term policy However, one danger is that competition will notice the high prices that consumers are willing to pay and enter the market, creating more supply and eventually reducing prices Market-Penetration Pricing Rather than setting a high initial price to skim off small but profitable market segments, other companies set a low initial price to penetrate the market quickly and deeply, attracting many buyers and winning a large market share Several conditions favor setting a low price The market must be highly price-sensitive so that a low price produces more market growth There should be economics that reduce costs as sales volume increases The low price must help keep out competition

Price

Simply defined: Price is the amount of money charged for a product or service Broadly defined: Price is the sum of values consumers exchange for the benefits of having or using the product or service

Non-routine Transactions

Strong culture prepares employees to handle non-routine transactions Non-routine transactions are unique The ability to handle non-routine transactions separates excellent hospitality companies from mediocre ones

Cross selling

The company's other products that are sold to the guest

Service-Oriented Organizational Structure

The conventional organizational structure is a triangular structure For example, in a hotel the CEO (chief executive officer) and COO (chief operating officer) are at the peak of the triangle The general manager is on the next level, followed by department heads, supervisors, line employees, and the customers The problem with this type of organization is that everyone is concerned with satisfying people above them in the organization, and very little attention is paid to the customer When a company has a service culture, the organizational chart is turned upside down The customers are now at the top of the organization, and corporate management is at the bottom of the structure In this type of organization, everyone is working to serve the customer

Organizational Culture

The pattern of shared values and beliefs that gives members of an organization meaning and provides them with the rules for behavior in that organization Strong culture: Directs employee behavior Gives employees a sense of purpose

Approaches to Pricing

The price the company charges is somewhere between one that is too low to produce a profit and one that is too high to produce sufficient demand Product costs set a floor for the price, while consumer perceptions of the product's value set the ceiling The company must consider competitors' prices and other external and internal factors to find the best price between these two extremes. Companies set prices by selecting a general pricing approach that includes one or more of these sets of factors Cost-Based Pricing The simplest pricing method is cost-plus pricing, which is adding a standard markup to the cost of the product Markup pricing remains popular for many reasons Sellers are more certain about costs than about demand Tying the price to cost simplifies pricing Managers do not have to adjust prices as demand changes Break-Even Pricing The firm tries to determine the price at which it will break even Target Profit Pricing A variation of break-even pricing Targets a certain return on investment Value-Based Pricing An increasing number of companies are basing their prices on the products' perceived value Value-based pricing uses the buyers' perceptions of value, not the seller's cost, as the key to pricing Value-based pricing means that the marketer cannot design a product and marketing program and then set the price Price is considered along with other marketing mix variables before the marketing program is set The company uses the non-price variables in the marketing mix to build perceived value in the buyers' minds, setting price to match the perceived value Competition-Based Pricing A strategy of going-rate pricing is the establishment of price based largely on those of competitors, with less attention paid to costs or demand The firm might charge the same, more, or less than its major competitors

Upselling

Training sales and reservation employees to offer continuously a higher-priced product that will better meet the customers' needs, rather than settling for the lowest price

Horizontal Marketing Sysytems

Two or more companies at one level join to follow a new marketing opportunity By working together, companies can combine their capital, production capabilities, or marketing resources to accomplish more than what one company can accomplish working alone Multichannel Marketing Systems With the proliferation of customer segments and channel possibilities, more companies have adopted multichannel marketing distribution Such multichannel marketing occurs when a single firm sets up two or more marketing channels to reach one or more customer segments

Horizontal Marketing Systems

Two or more companies at one level join to follow new marketing opportunities. Companies can combine their capital, production capabilities, or marketing resources to accomplish more than one company working alone.

Value-Based Pricing

Uses the buyer's perceptions of value, not the seller's cost, as the key to pricing Tradeoff Analysis Example Ask buyers how much they would pay for a hotel room with or without certain amenities

Price Adjustment Strategies

Volume Discounts Offering discounts to customers who purchase a large amount of products Discounts on time of purchase Ex. Seasonal discounts on hotel rooms Discriminatory Pricing Refers to segmentation of the market and pricing differences based on price elasticity characteristics of the segments

Empowerment

When a firm empowers employees, it moves the authority and responsibility to make decisions to the line employees from the supervisor

Motivational Houses

provide incentive travel offered to employees or distributors as a reward for their efforts

Junkset Reps

serve the casino industry as intermediaries for premium players