11/30/2005

Tokyo Hotel -- No leash, no paws, no service?

Would you be willing to pay for a five star hotel? What about for you dog? New in Tokyo is the pampering your pet has been waiting for. I wonder what kind of demand curve this type of service has? Or will have? Think about it. How much would you be willing to pay to make sure your pet got top treatment while you were away on business? Would you be willing to pay for something where they will probably get more attention then the average day that they spend at home with you. This has got to be something for the super wealthy or those people that treat their pets like their children.

3 comments:

Dr. Tufte said...

-1 on Maddy's post for grammatical errors.

This sort of operation has been around for a while. They charge a high price because there are people - say, Paris Hilton - who will pay for it.

This tends to be a phenomenon of large cities with a lot of business travel. In an area where it is tough to connect with neighborhood kids to do this sort of work, it will flourish.

FWIW: When we lived in New Orleans (in the city itself) we hired a professional babysitting service. It was relatively cheap because there was a market for this with tourist and convention traffic. We got great babysitting from pre-Grandma types at wages competitive with teenagers.

Blake said...

My thought is that a plush, 4 star hotel atmosphere for pets is truly a luxury service. However, if people are willing to shell out the cash, this luxury service will continue to possess a demand. While I think this type of service could potentially have a viable life in the market, I would classify the market as being firmly inelastic, thus inidicating that in order for it to maintain its viability, the business would need to adhere to a discipline of highly strategic methods in order to target and retain a loyal customer base.

Dr. Tufte said...

All I would add is that I think this a good field for price discrimination.

I think Blake is right - demand is inealastic, but I would add that this is only for a fraction of folks. For others it is probably quite elastic.

In this sort of case you offer to types of service - a first class one and a cut rate one. It seems to me that we've had the latter for a long time, and this firm is addressing the former.