Question

Lets consider again the willingness to pay for a hotel room and theme park entrance for the four market segments. Also assume as before a market size of 5,000 individuals per day.

Segment	Room	Theme Park	Market Share
Amusement Park Lover	$200	$150	20%
Luxury Lover	$300	$50	10%
Conference Devotee	$325	$5	20%
Disney Devotee	$50	$200	50%

Which would be the optimal price to maximize revenue for the Room and Theme Park, without considering the possibility of bundling?

Room: $200

Theme Park: $150

Room: $300

Theme Park: $150

Room: $200

Theme Park: $200

Room: $300

Theme Park: $200

Answer 1

1. Room: $200

Theme Park: $150

Let's assume the total number of people be 100 so a 10% share is 10 people and 20% share in 20 people and so on. With option 1, at ($200,$150) Everyone except Disney devotees will pay for room and Only Disney devotees and amusement park lovers will pay the $150 for a theme park.

Market share tapped at $200 room = 20 + 10 + 20 = 50%

Revenue = 200 * 50 = 10,000

Market tapped at $150 theme park = 50 + 20 = 70

Revenue = 150 * 70 = 10,500

Total = 20,500

Only Luxury lovers and conference devotees will pay $300 for a room

Market share tapped at $300 room = 10 + 20 = 30%

Revenue = 300 * 30 = 9,000

Revenue form $150 theme park = 10,500

Total = 19,500

Revenue from $200 room = 10,000

Only Disney devotees will pay $200 for a theme park

Market tapped = 50%

Revenue = 200 * 50 = 10,000

Total = 20,000

Revenue from $300 room = 9000

Revenue from $200 room = 10,000

Total = 19,000

All revenues:

1. 20,500

2.19,500

3.20,000

4.19,000

Option one with $200 room and $150 theme park will bring maximum revenue