Pricing strategy of multi-oligopoly airlines based on service quality

Hang Zhou and Shikang Zhou

PLOS ONE, 2019, vol. 14, issue 6, 1-14

Abstract: In recent years, with the rapid development of China's air transport industry and the change in market consumption structure, service quality has become one of the important factors affecting airline revenue. How to formulate a reasonable pricing strategy and maintain competitiveness in the fierce market competition has become an urgent problem for airlines. First, the impact factor of service quality level in the traditional pricing model is introduced and a static price competition model for multi-oligopoly airlines based on service quality is established in this paper. And then, a dynamic pricing model based on service quality of the multi-oligopoly airlines is established. The model incorporates the weight factor of service quality impact, which is used to indicate the weight of the service quality level in the process of airline dynamic pricing. The research results show that the service quality level of airlines has an indispensable influence on its development. Airlines should improve service quality as soon as possible to enhance market competitiveness and achieve sustainable development.

Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:plo:pone00:0216651

DOI: 10.1371/journal.pone.0216651

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