Marketing Mix: Pricing and Placing Strategy of Singapore Airlines Ltd.

PRICING AND PLACING STRATEGY – SINGAPORE AIRLINES LTD (SAL)
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Pricing Strategy of Singapore Airlines Ltd
Pricing strategy is the only revenue-generating factor in the marketing mix. Brands should evaluate the value proposition, differentiation, and industry position before determining a suitable price for a product or service. Disparities in pricing strategy could result in losses, as customers would perform an immediate brand switch to seek convenience and affordability. Pricing has become sensitive to businesses and customers since the COVID-19 outbreak. The post-pandemic era made customers reluctant to make impulse buying decisions and exhausted disposable income. Brands must evaluate the internal and external business environments before adopting a pricing strategy to retain customers while encouraging spending on offered products or services (Lim 2023). Singapore Airlines Ltd (SAL) operates in a competitive business environment. The brand should adopt various pricing strategies to make servicescape relevant and attractive for customers in the long run.
SAL follows a variable pricing strategy to meet market demands and manage industry competition. Variable pricing strategy alters businesses’ pricing method to generate profit between fluctuating demand and supply. A variable pricing strategy allows brands to adjust prices according to industry fluctuations and generate revenue while managing competition (Abid 2022). SAL changes its pricing brackets regularly based on fuel prices, haul destinations, and flight demands. SAL adjusts prices based on seasonal and other factors that influence sales in the airline industry. For instance, SAL introduces promotions and discounts during the holiday season to attract more customers willing to travel domestically and internationally. A variable pricing strategy allows SAL to attract more customers and maintain its market share in the long run.
SAL has four flight categories offered to customers. First, SAL offers an economy class to a mass audience with basic facilities and features. SAL should adopt a competitive pricing strategy to attract customers and extract revenue during immense competition. According to Zhen and Xu (2022), a competitive pricing strategy is an approach to setting price points for products or services by evaluating pricing propositions offered by competitors. SAL should use a competitive pricing strategy to attract mass customers that travel domestically and internationally. Economy class passengers are price sensitive, and SAL should charge a standard industry price to remain competitive in the marketplace.
Second, SAL offers Premium Economy Class (PEC) flights to customers. SAL introduced PEC in 2015, offering wider seats and substantial leg space compared to economy class. SAL should charge value-based pricing for pushing PEC in the market. By definition, brands adopt a value-based pricing strategy to charge customers against value propositions (Talon-Ballestero et al. 2022). SAL could differentiate PEC by offering different cuisine and other entertainment to expand the value p...