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Spa Ceylon

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by

Michelle Abdulnour

on 2 September 2015

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Transcript of Spa Ceylon

Spa Ceylon
The entity’s main target is to compete with other high-class domestic and international spa orientated organisation's.
Even though Spa Ceylon’s products are more expensive, they use alternative ways of testing products in order to protect the environment.

This incites their niche audience to purchase products from them, regardless of the price.
Identify the pricing
objectives purchased by
Spa Ceylon for the
skincare products.
How does this
pricing objective
support the organisation’s
value proposition?
Spa Ceylon define their products and services as luxurious
Their Ayurvedic products are the main source for the organisation's expensive pricing.
According to Kulkarni, A (2015) “Literature suggests use of herbal, mineral and herbo-mineral preparations in various dosage forms for centuries”.
The organisation endorses “environmentally-friendly products, supports human rights, and is against the use of child labour and animal testing”.
Having a luxurious product line strictly relates to Spa Ceylon’s pricing objectives as their company is based around brand equity and competitive success.
By
Lilian Stirling
Michelle Abdulnour
Ellen Webster

Kapferer, J and Michaunt, A define luxury as “parallel success in its shadow market, because the reasons for the growth of the former also serve as levers of the growth of the latter.” (2014).
What pricing strategies should Spa Ceylon implement for the sale of their products to India? Give reason for your answer.
What market forces are likely
to impact on Spa
Ceylon’s price setting?
Suggest approaches that
Spa Ceylon can use to
address these market
based concerns.
Companies are often faced with the challenge of needing to change the price of their products to adapt to the market force. A market force is defined as “The economic factors affecting the price of, demand for, and availability of a commodity” (Oxford Dictionary, 2012).
Spa Ceylon prices their products and their premium, targeting a niche market. Companies who participate in niche marketing create some of the best ways to maximize their profits and receive the greatest possible return their marketing investment (Richardson, 1997).
There are many factors which could possibly impact Spa Ceylon’s pricing system but the main factor which is likely to impact their price setting is due to competition.
Spa Ceylon price their products according to their competitors. Indian and Sri Lankan Spa’s attract a specific group of people who associate the value and quality of merchandise based on the price of the product. Thus creating pressure for Spa Ceylon to keep up with the pricing system of their competitors to keep up with other premium spas whether it be domestic or internationally
located.
The case
study it explores and demonstrates the actual price ranges of Spa Ceylon’s leading competitors; for example L’Occitane charges $50, and Quan Spa charges $40 for a basic massage, where as Spa Ceylon charges $45. For full body rituals, L’Occitane charges $200,
Quan Spa charges
$220, and Spa Ceylon
charges $250.
This demonstrates that Spa Ceylon creates a price in between their two competitors, thus appealing to the middle and upper income earners. Even though Spa Ceylon is in the higher price range, customers are willing to spend the money due to the fact that Spa Ceylon spends a lot of time creating their products used throughout the spa treatment.
Their ayurvedic products are designed and produced in India, then imported to Sri Lanka, where they can be used, as well as being available to customers to purchase
Thank You for listening
References
Kapferer,J, & Michaut,A, A, 2014, 'Research paper Luxury counterfeit purchasing: The collateral effect of luxury brands' trading down policy', Journal of Brand Strategy, vol. 3, no. 1, p. 59.
Kulkarni, A, Rumalla, S, Andhale, S, Kolatkar, A, & Kuchekar, B, 2015, 'Taste Masking of Ayurvedic Nutraceutical Formulation by Pan Coating Process', Pharmacognosy Journal, vol. 7, no. 4, p. 215.
Richardson, M.K. & Doucette, V. 1997, "Niche marketing: Targeting your efforts for success", The Michigan CPA, vol. 49, no. 2, pp. 30-31.
Songini, ML 2001, 'Demographic Segmentation', Computerworld, vol. 35, no. 31, p. 42.
Tobias Schaefers, 2014 "Standing out from the crowd: niche product choice as a form of conspicuous consumption", European Journal of Marketing, Vol. 48 Iss: 9/10, pp.1805 - 1827
Spa Ceylon’s products and services are priced at a premium, catering to a niche market. According to Porter’s (1980) strategic approaches, focusing on specific needs of parts of the market rather than addressing the whole market (i.e. pursuing a niche marketing strategy) can be the source of a competitive advantage.
Spa Ceylon would need to cater for the upper-middle class people who live in India
Spa Ceylon should implement demographic segmentation as a strategy, which is an approach used by companies to separate or identify customers by socioeconomic groups, such as location, age, sex, occupation, education, ethnicity, income, family size, family life cycle and religion. The results are often used to aim marketing and sales campaigns at niche customer groups.
Spa Ceylon target market is middle aged to elderly females with higher incomes, therefore the price of their products and services would be higher and “exclusive” as the target market is willing to pay
Full transcript