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Virgin Conducting Pricing Research on Inflight Internet

Posted by PriceBeam on April 4, 2017


Virgin Australia has started to conduct pricing research to determine their customers' willingness-to-pay for inflight internet. Pricing research is important to make sure you understand what your customer cares about, and that is exactly what Virgin aims to do with this research: Understand how much their customers value inflight internet, so that Virgin can charge accordingly (or decide not to invest in it).

As you can see from the survey, Virgin wants to know how much customers are willing to pay for:

1) Basic Internet (For checking your email, general browsing, online shopping)
2) High Speed Internet (Watch Netflix and Videos, too)
3) Free 30 Minute Access (Yes, you pay for free stuff too)
4) The Brand (Virgin vs Quantas)

These four are the attributes of the analysis. Essentially, what Virign does is to adjust these 4 attributes and see how it influences the fare: that is, the price customers are willing to pay for their ticket given the current attribute levels. While the brand is not something that can be changed over night, the 3 other attributes are: and that is what Virgin will do: Once they know how the "Basic Internet", "High Speed Internet" and "Free 30 Minute Access" influences the fare, they can adjust them so they together will maximize profits/revenue/marketshare (whatever their objective).

Written by PriceBeam

PriceBeam posts regular guides, articles and news related to pricing and strategy. Go have a look!