Impact of Price Promotion Strategies on Consumer’s Perceived Value (GC01501)
Acknowledgement
I would like to acknowledge that my parents including my father and mother have contributed a lot to the success of my career, particularly in completing this higher degree in the UK. Thus, my honour and cordial love for them and always bless to the almighty god for wealth and happiness. Then, my supervisor has supported me a lot with effective feedback, suggestions and guidelines. Therefore, I would like to say many thanks to him. Next, I am grateful to the university and librarians who have helped me providing available study resources and making a nice learning environment. Finally, I would give thanks to my friends who have supported me in the completion of this coursework (dissertation) whenever I faced difficulties.
Abstract
The aim of this study is to investigate and analyze several kinds of price promotional strategies which are applied in the travel industry of the UK to influence the customer perceived value. Thus, the objectives of this study are: a) to identify the price promotions strategies used in the UK travel industry; b) to evaluate the customer view about the price promotion strategies applied in the UK travel industry; c) to analyze the effectiveness of price promotion strategies used in UK travel industry on the customer perceived values, and d) to recommend strategies for the UK travel industry to improve customer perceived values. Different methods and methodologies are used to meet the above-mentioned objectives, which are described in this chapter.
The researcher considered that the pragmatism philosophy is suitable for this research work. Two different research approaches are suitable to achieve the research aims and objectives. The first approach is the descriptive research approach and the other one is the explanatory research approach. Then, the explanatory research approach is used to analyze the cause and effectiveness of the research subject. This means this approach will assess and explain the impact of price promotion strategies on the customer perceived values in the travel industry of the UK. This study follows a deductive research approach. The reason is the researcher is familiar with the research topic and subjects and have initial knowledge and understanding. In this research work, the quantitative research approach is suitable. This is because this study focuses positivist paradigm, where the collected data are disclosed in several numerical forms.
The researcher in this study has applied both primary and secondary data sources. This study applies a survey instrument to collect the required data. The survey strategy used in this study includes combinations of qualitative and quantitative questions. This strategy includes both open-ended questions and closed-ended questions. There is a total of 15 questions in this survey questionnaire. Out of a total of 15 questions, there are 12 questions that are closed-ended. The researcher has targeted 100 travelers or customers in the UK travel industry. Among these 100 target people, there was 50 male and 50 female. The sample customers/travelers are classified into five key aged groups. These age groups are 16-25, 26-35, 36-45, 46-55, and 56+. As data analysis methods, the SPSS and MS Excel Sheet has been used to store and maintain and evaluate the quantitative data. Then, the researcher applies to content and thematic analysis techniques. These techniques group the research data into a number of contents and themes and analyze them.
Chapter 1: Introduction
1.0 Introduction
Price promotion strategies play a significant role in gaining improved revenue and profit for the travel and tourism industry. This study conducts research on how to price promotion strategy impacts the customer perceived values in the UK travel industry. Thus, this chapter includes the research introduction, which includes a number of sections. Firstly, the research background is outlined. Then, the research rationale is discussed. Next, the research aims and objectives along with research questions are defined. Following these, research significance and the structure of research are explained. Finally, this chapter concludes what is next.
1.1 Background of the study
In this current business world, the organization mainly the travel industry face high competition. Thus, it has been a significant issue for businesses to focus on selling products and services and their target and potential customers (Weiss and Empen, 2015). In this highly competitive market situation, price and promotional issues have come under deep consideration of business organizations including the UK travel industry. Among several factors and techniques, a price promotion strategy is effectively being used in the current business world including the travel industry (Choongbeom and Mattila, 2014). In addition, price promotion is used as the business strategic technique to improve revenue and profits. Most importantly, a price promotion strategy is used in the service market like the travel industry to motivate and influence customers for more buying.
However, if organizations fail to apply this tool effectively and appropriately, they will face challenges in brand loyalty and reputation. On the other hand, many organizations in the travel and tourism industry use price promotion as a sales or marketing strategy without considering the customer perceived value (Campo and Yague, 2014). If organisations fail to understand customer perceived value when they design their price promotion strategy, they fail to gain their business aims and objectives (Stremersch and Tellis, 2012). Therefore, it has been a significant issue for business organizations including the UK travel and tourism industry to understand their customer perceived value along with their price promotion strategies.
1.2 Research rationale
The travel and tourism industry is a big industry in the current business world. This is the fastest-growing industry in the current world. Thus, its importance is widely recognized. Nowadays people are spending about 5% to 10% of their total income in a year (Holloway and Humphreys, 2016). This industry creates a single job every 2.4 seconds. This industry earns about £3 trillion in a year. Pricing in the travel and tourism industry is a complicated process (Middleton and Clarke, 2015). This is because the travel and tourism industry is related to Hotels, Railways, buses, and Air Travel. In addition, the pricing of this industry depends on other issues such as geographic location, destinations, seasonality, competitor prices, government regulations, varying customer demand (Kotler, Bowen and Maken, 2016). However, it is important to determine the pricing to prevent competition, to fetch target and potential market share, and take care of price elasticity of demand. Travel and tourism organizations can respond to their pricing circumstance in two different ways.
The first one is to correspond with marketing strategy, and the second one is to correspond to marketing operations for meeting present competition and demand (Michael, 2014). Price promotion plays a significant role in determining prices in the travel and tourism industry. Most importantly, the price promotion strategy is designed for short-term to increase sales and revenue and to gain improved market share and promote new products or services (Cook and Marqua, 2013). In addition, price promotion strategy plays a significant role in promoting price-sensitive customers. Therefore, it is significant for the travel and tourism businesses to understand the customer perceived values before designing the price promotion strategies for their products and services. As a result, this study focus on the price promotion strategy used by the travel and tourism industry, and the customer perceived values. Then, the study evaluates how the price promotion strategy impact the customer perceived values in the UK travel and tourism industry.
1.3 Research aims and objectives
Aims
The aim of this study is to evaluate the price promotion strategy used by the travel and tourism industry, and the customer perceived values. Then, the study evaluates how the price promotion strategy impact the customer perceived values in the UK travel and tourism industry. Then, the study recommends the UK travel and tourism industry on their price promotion strategy and consumer perceived values.
Objectives
- a) To understand the price promotion strategies used by the UK travel and tourism industry
- b) To analyze the customer perceived values in the UK travel and tourism industry.
- c) To evaluate the impact of price promotion strategy on consumer perceived values in the UK travel and tourism industry
- d) To recommend the UK travel and tourism businesses on how they can develop their price promotion strategies considering the customer perceived values to promote revenue and profits.
1.4 Research questions:
Key question:
How do price promotion strategies impact the consumer perceived values in the UK travel and tourism and industry?
Sub-questions:
- a) What are the price promotion strategies used by the UK travel and tourism industry?
- b) What are the customer perceived values in the UK travel and tourism industry?
- c) How do the price promotion strategies impact consumer perceived values in the UK travel and tourism industry?
- d) How can the UK travel and tourism businesses develop their price promotion strategies considering the customer perceived values to promote revenue and profits?
1.5 Significance of the study
It considered that this study will be supportive for both the UK travel and tourism industry and the researcher herself. The study will evaluate the price promotion strategy used by the travel and tourism industry, and the customer perceived values. Then, the study will evaluate how the price promotion strategy impacts the customer perceived values in the UK travel and tourism industry. Then, the study will recommend the UK travel and tourism industry on their price promotion strategy and consumer perceived values. This means the UK travel and tourism industry will get support from the study which will improve its sales revenue and profits. In addition, it will be easier for the UK travel and tourism industry to gain sustainable competitive advantages and to survive in the competitive marketplaces.
On the other hand, the study will be helpful for the researcher herself in several ways. Firstly, this study has extended the research and analytical skills of the researcher and taught how to conduct research work for a business. Secondly, this study has improved the interpersonal skills of the researcher. Most importantly, it has improved written communication skills, decision-making skills, problem-solving skills, computer skills and presentation skills. These interpersonal skills will help the researcher to build up a better career in the near future.
1.6 Structure of the research
This research study has been conducted by dividing it into six key sections. The first section has given an overview of the research background along with research rationale, research aims and objectives, research questions and research significance. The second section has conducted a critical literature review focusing on the key variable included in the research topic. This section first focuses on price promotion strategy, and on consumer perceived values. Then, the section has focused on how to price promotion strategy impacts the consumer perceived values in the UK travel industry. The third section has formulated and designed the research methodologies including research philosophy, approach, strategies, data collection methods, data analysis methods, research ethics, and reliability and validity. The fourth section has collected and maintained research data and presented the research findings along with research discussion. The fifth section has included the research conclusion and research recommendations. Finally, the sixth section has discussed the research limitations and the scope for further researcher……………
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