14 Jan

Affect on Internet on price considerations for: Airlines, Hotel Reservation, Book Sales

Internet changed more aspects in our life; communication, education, shopping, reading, and many other personal hobbies that came with internet, marketing is also changed, the marketplace changed to market-space (Tapscott Don, 2000), the space that holds infinite different things that everybody can surf it at any time, limitations were also changed; for buying an item we must go to the market-place, while, market-space just requires internet access and computing device, distances where became equal, and physical payment-receipt also changed to digital transactions.

Online resources provides more information that can’t be get in real-world, users can find target information through search-engines services, a chain of information that relatively unlimited, in few minutes, we can find and collect different prices for same products or service, any business realizing that fact, knows that customers definitely buying cheaper products with same quality, and also, distributions costs and expenses were also decreased by using online systems like e-commerce that approximately leads the prices to be decreased.

Airlines

Airlines services are approximately same, with regard to some special services and strategy, but overall service is providing flights for travelling passengers and/or goods to another place, basing on that point, customers are always price sensitive to airlines’ prices because at worst case, the seat place is suitable for few hours and designed for human beings. From this perspective, Internet will influence on airlines price consideration because “Internet facilitates competition, thereby creating downward pressure on prices” (Eugene Orlov, 2011, p.35) so that airline companies are in high competition.

Hotel Reservation

Classical methods of Hotel reservations are by contacting hotel-customers services or via special agents or other companies that provides tourism services, while by using online applications such as Hotel Management Software, it provides better management abilities that analysis all requests on demand and gives accurate results without conflict, then, customers can review hotel services by reviewing their service lists and comparing various prices with another hotels. Internet also influences on hotel prices because customers can find most hotels with similar services by using internet search, then, they can decide on lower price.

Book Sales

Generally, online books store database provides all information that helps customer to find and select their needs, without going to physical places, books can be reviewed and purchased online, in other hand, e-books can be delivered on demand after payment completed.

Price consideration for books sales limited to some restrictions that set by main publisher, the price might be fixed as exist in my country, books must be sold with fixed price in all cities and places, however, internationally, books versions and prices are vary according to general costs that requires by international retailers, and the transportation companies.

In conclusion, dynamic price strategy is most suitable for online marketing because customers can easily find same products with different prices, then, most companies are in competition because of the internet, then, price should be justified because customers will buy same product with lower price.

References:

  • Eugene Orlov 2011, ‘HOW DOES THE INTERNET INFLUENCE PRICE DISPERSION? EVIDENCE FROM THE AIRLINE INDUSTRY’, Journal Of Industrial Economics, 59, 1, pp. 21-37, Business Source Premier, EBSCOhost, viewed 3 December 2011.
  • Tapscott, D 2000, ‘Internet’s reach even extends to 4 P’s of marketing’, Computerworld, 34, 29, p. 30, Business Source Premier, EBSCOhost, viewed 3 December 2011.

About the Author

Leave a Reply