Dynamic Pricing in the Hair & Beauty Industry - Case Timma
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Journal Title
Journal ISSN
Volume Title
School of Business |
Bachelor's thesis
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Author
Date
2018
Department
Major/Subject
Mcode
Degree programme
Tieto- ja palvelujohtaminen
Language
en
Pages
20
Series
Abstract
Dynamic pricing has become increasingly popular especially on electronic marketplaces with the help of the rise of modern computer systems. Essentially a form of price discrimination and a means of revenue management and maximization, dynamic pricing has been most widely studied and used in the air travel and hospitality industries. In the very core, dynamic pricing is based on being able to accurately estimate demand for a certain product or service. Electronic marketplaces make demand forecasting easier for businesses in many cases, so dynamic pricing becomes possible for a variety of industries. In my thesis I have studied different factors that affect the probability of sale of a certain time slot in a marketplace selling appointments for hair & beauty services. The research data consists of 62 137 available time slots during the month of November 2017. The data was analyzed in R and a Generalized Linear Model (GLM) with a binomial variance function and a logit link function was fitted to study regressions. My research proves that time of day, proximity to center, consumer ratings and weekday all have a statistically significant effect on whether a particular time slot is sold or not. The results concerning the effect of consumer ratings and proximity to center (location) are in alignment with previous research from the hospitality industry. The effect of time of day or weekday on the likelihood of sale had not been researched before in a relevant industry. It seems that to develop a deeper understanding of the factors affecting likelihood of sale and thus demand in the hair & beauty industry more variables would have to be taken into account. This seems like a feasible subject for further research. Also, a similar study from a different service-based industry would be interesting.Description
Thesis advisor
Mallat, NiinaKeywords
dynamic pricing, hair and beauty, electronic marketplace, price discrimination
