How do you determine the right price for tourism products?

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How do you determine the "right price" for tourism products?

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Abstract

The tourism industry currently is a rapidly changing sector. I saw it last year when I worked for a small tour operator in South Africa, African Eagle. Although the organization was quite small and rather upscale, we were looking for providers on a daily basis who offered their services at the lowest prices in order to be able to offer trips at attractive prices.
Although we will mainly discuss the issue of "sell out" during the course of this paper, this example demonstrates that finding the "right price" is now an essential element in the tourism industry.

This sector represents 12% of the global GDP and is now everyone's focus. The actors are extremely numerous, and the Internet revolution widely hit the industry. Price comparison sites give new power to the consumer, who is also becoming more demanding where prices are concerned. Tourism professionals must therefore offer the right price at the right time in order to attract customers.

Introduction
What is the link between price management and the tourism industry?
Some Reminders Regarding Price Management
Some definitions
Different pricing strategies, according to Simon, Jacquet and Brault
The Tourism Industry
1. Tourism today
2. Actors
The Relation Between Price Management and the Tourism Industry
What tools are used for determining price?
Airlines, Yield management and Price Management
1. Case study: Air France
2. Yield management and price management operations
3. Implementation
4. Why use it ?
Yield Management Adapts to Hotels
1. What differences exist between airlines and hotels?
2. Case study: What price should I set?
Tour Operators and Dynamic Pricing
1. Case study: Marmara
2. The importance of price optimization
3. Risks of dynamic pricing
4. How do you create efficient dynamic pricing?
Conclusion

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[...] Thus, taking in consideration all of the data we have discussed above, dynamic pricing allows the tour operator to provide the best price according to demand. However, the implementation of dynamic pricing should not obscure significant risks. II.3.C/ Risks of dynamic pricing The first is related to the commoditization of products and the increasing importance of price with respect to the purchasing behaviour of customers, phenomena on which the whole industry seems to agree. Thus, people do not know what the "fair price" to pay is for their trip. [...]

[...] To start with, we will try to briefly go over how prices can be set for the aircraft. Firstly, a single element: plane seats (like hotel rooms) are perishable. That is to say that if the services are not purchased when they are available -in our case, air tickets -then they are lost forever. It should be understood that the higher the importance of the filling ratio, the lower the cost per passenger. Indeed, fixed costs (fuel, personnel, etc.) remain the same and airlines have to be paid by someone when planes are not full. [...]

[...] More customers are constantly looking for the lowest price and do not know what the real price is of a tourism product. So, airlines, hotels and tour operators are now seeking solutions to find the prices that allow them to ensure maximum profitability in their structure. This award should not be too low so as to not "sell out" their product, and it should not be too high so as to not scare the customer. What then are the tools used by these professionals to set those prices? [...]

[...] How do tourism professionals respond to the new world tourism situation? What differences between the three main actors? We will discuss these different points during the course of this paper. First, we will recall some basics and identify the current issues concerning world tourism. We will then see, via various examples, the techniques employed by such companies in the sector, and examine them in more depth with respect to the three major players in the tourism industry: the airlines, hotels and tour operators. [...]

[...] The rules vary from one site to another, and they do not cancel or offer repayment of money paid in part or in full. These sites are paid by a commission (known as “provision” in English), which ranges from 5 to 25% and is generally determined by the hotel in real time, based on the current price of the bedroom. The order the hotel offers the service of sale depends on what the latter receive in the event of sale (it is no longer booking). [...]

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