The Optimization Of Service Product’s Pricing And Revenue Based On Customer Segmentation

With the rising of the third industry, service economy has been developed rapidly in modern society, but the free development of market and the diverse demand for service products of people, making the increasingly competition in the service industry. Under this background, how to pricing for service product and utilizing of company’s resources in order to maximize enterprises’profits, at the same time, it’s also help for enterprises get their own competitive market place. Because of the specificity of service product, the pricing of service product is also different from the general physical products. There are many theory and methods about service products pricing in the world, but most of them relatively scattered, and lacking of a systematic framework. Therefore, it’s necessary based on the perspective of general services and existing pricing method, segmenting customers and then using different prices for different customers to optimize service product pricing and revenue.This paper’s research object is service product, so first we introduce the definition and scope about service product, then we get a conclusive discussion of service product’s characteristics. By reading a large number related literatures, the paper systematic analyzes the existing pricing theory and methods of service product, considers the features of service product impact on the pricing, then the paper proposes the theoretical pricing framework of service product.On the issue of customer segmentation, the paper combines the theory of marketing, investigates the different perspectives of each customer segmentation theory. For the specificity of service product, we propose the general subdivision standard, divided the customers into general consumers and willing to wait consumers who are price-sensitive, based on the division, we continue to research the question of service pricing and revenue optimization.The main content of our paper is based on the customers’ utility function, this function concludes the valuation of products, we assume consumer’s sensitivity to price and quality is heterogeneous. By this function, we discuss the respective demand functions when the customer groups face the different pricing strategies. Then we construct the profit function to study how to pricing for service product when the condition are a single monopolist and competitive market.