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What is it worth to you?: Beyond cost structure and competition: pricing the knowledge based services of an Italian travel agenc,Used
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Satisfying consumers is the best method for organizations to gain competitive advantage. To deliver quality services to clients we need to understand what they are looking for and how much value they attach to the single elements of the offering. It thus become crucial, especially for knowledge based services to develop pricing models that take into account the perceived value of the service by the client, going beyond simple cost or competition considerations. Combining an aggregate planning model with a share of choice model, I establish a link between the planning of the resources and their pricing. The shadow prices associated with the solution of the optimization model then provide a proxy for the price of the expertise delivered. Model and results are presented for a travel agency.
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