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460 pricing
locations are central to Butler's tourism product
life cycle model, as little prestige is attached to
those locations which are in decline. Furthermore,
different market segments will tire of the same
location at different points in its product life cycle.
Recent research in the language of tourism
reinforces the importance of prestige-related
images and text in tourism marketing. Finally,
tourists who have been questioned on the tales and
stories they tell other tourists have been shown to
discuss their visits quite selectively. Indeed, tourists
show a particular preference for managing their
identity so that their prestige and personal status
is highlighted in their holiday stories.
References
Urry, J. �1990) The Tourist Gaze:Leisure and Travel in
Contemporary Societies, London: Sage.
Further reading
Pearce, P.L. �1991) `Travel stories: an analysis of
self-disclosure in terms of story structure, valence
and audience characteristics', Australian Psychologist
26�3): 172±5.
pricing
PHILIP L. PEARCE, AUSTRALIA
Pricing represents the published or negotiated
terms of the exchange transaction of goods or
services between producers and consumers. It is an
economic concept in which each party �consumers
and producers) in the transaction aims to maximise
their satisfaction. For their part, consumers
attempt to buy at a price which maximises their
perceptions of benefits and value for money as
they choose from competing products on offer.
Producers or service providers aim to reach or
exceed targeted objectives of sales volume or
revenue and to maximise profits and/or return
on investment. In the long term, prices should
be set at a level which reflects an organisation's
costs, anticipated profits and the degree of market
competition.
Successful tourism providers understand that
pricing is an essential activity and, in practice, a
complex one for several reasons. First, segmented
selling of tourism products results in differential
pricing which can vary from the published price,
especially if tourism products are selected as a
`package' of priced options. More importantly,
pricing forms the main tactic in managing trade
fluctuations, because the product is not able to be
stored for the future. Further, it is difficult to
expand the capacity of a hotel or an airline in the
short term. Yield management is the process by
which tourism providers try to maximise revenue
by manipulating the demand/price relationship. At
times of high demand, published prices are quoted
while at slacker times, extra trade can be
encouraged by attractive pricing. In general, there
is a high price elasticity for discretionary segments
such as the leisure, recreation and holiday
markets. This means that customers for these
tourism products are sensitive to the prices charged
and producers need to operate pricing strategy
with care.
Further reading
Fay, C.T., Jr, Rhoads, R.C. and Rosenblatt, R.L.
�1971) Managerial Accounting for the Hospitality
Service Industry, 2nd edn, Dubuque, IA: Wm. C.
Brown, 363±81. �Describes and classifies pricing
decisions.)
Harris, P. �1992) Profit Planning, Oxford: Butterworth-Heinemann,
88±105. �Discusses methods
of pricing products and services in hospitality
and tourism.)
Middleton, V. �1994) Understanding the Marketing Mix
in Travel and Tourism, Oxford: Butterworth-
Heinemann, 95±104. �Explains the issues in
pricing for tourism products.)
Muller, T.E. �1991) `Defining segments in an
international tourism market', International Marketing
Review 8�1): 57. �Demonstrates, through
empirical research, how the identification of
different segments will allow the application of
different marketing and pricing strategies.)
RICHARD TEARE, UK
HADYN INGRAM, UK
GAVIN ECCLES, UK