Marketing Plan Pricing Approach

Marketing Plan – Main Pricing Approach

Cost-Based Pricing
Shanti Spa will apply a 40% mark-up, from cost, on all services which will in turn allow for an average 29 % profit margin.

Profit Margin Calculator Results
For the services below the average gross margin is 28.57%. This represents an average selling price of $55.14.
Results Summary
Product
Name Wholesale
Cost Markup
percent Selling
price Gross Margin
$ Gross Margin
%
Ananda Pedi $48.84 40.00% $68.38 $19.54 28.57%
Ananda Mani $50.11 40.00% $70.15 $20.04 28.57%
Paraffin Wraps $35.12 40.00% $49.17 $14.05 28.57%
CdMP Facial $22.60 40.00% $31.64 $9.04 28.57%
Holistic Facial $43.84 40.00% $61.38 $17.54 28.57%
Facial Glow $42.42 40.00% $59.39 $16.97 28.57%
Body Scrub $34.37 40.00% $48.12 $13.75 28.57%
Algae Wrap $55.16 40.00% $77.22 $22.06 28.57%
Waterfall Thal. $25.53 40.00% $35.74 $10.21 28.57%
Ritual Massage $35.87 40.00% $50.22 $14.35 28.57%
Product Averages: $39.39 40.00% $55.14 $15.76 28.57%

Value-Based Pricing

In accordance with the principles of value-based pricing, and keeping in line with our mission, vision and values, Shanti Spa has solicited the expert opinion of respected spa consultant Douglas Preston when pricing our services.   He had the following to say:

"The perceived value of a spa treatment is very high and a spa visit is an important part of an upscale resort experience."
"Brainstorm to come up with a list of benefits that you can use in your marketing campaign. Focus on the emotional impact of your product and service. Think about what your customers (or potential customers) value. Do they attach importance to great customer service, customized treatments, and personalized, human touch? How about value and saving money? Perhaps your customers prefer small, independent professionals over large companies and retail chains."
Shanti Spa Clients Value More for More Experiences Including:
- Exclusivity
- More for more service offerings
- Impeccable... [continues]

Read full essay