Why do customers pay for some services without hesitation? Why do they bargain in others? Pricing services therefore is not easy. Also, since a large part of a service is intangible, there is flexibility as well as confusion in pricing. But it is precisely this emphasis on intangibles that allows a service to charge a premium, provided of course, it delivers an unparalleled experience.
19.1 PRICE DEPENDS ON THE CONTEXT OF CONSUMPTION
A customer who does not mind paying 6 for sending an SMS to Indian Idol contest, objects when asked to pay for telephone calls made on the same mobile. Coke’s price varies depending on whether you buy it ...