Are you or your Board of Directors thrusting personal pricing opinions onto the consumer?
Over the years, I’ve seen this done time and time again by well-meaning committees and boards. As a result, thousands (or, in some cases, hundreds of thousands) of dollars are never realized!
Too many boards and committees make marketing as well as event ticket pricing decisions based on personal bias. Bias is a human condition that we all share. What this means is that even the best of intentions can result in lost revenue. In some cases, a significant loss of income.
Here’s a real-life example.
Years ago, the Chairman of the Board for a highly respected local event said, “I would never pay $75 for a VIP event ticket! Therefore, we won’t charge more than $75 for a VIP Ticket.” The rest of the board agreed, shrugging and said, “He’s the Chairman, right?” All in lock step. They set the VIP ticket price at 75 dollars.
In this particular case, VIP tickets went on sale and SOLD OUT in a matter of days. Here's the real rub. If someone had been offended by the $75 VIP ticket price, they could have gone to the event for FREE. It was a FREE event to the public!
However, had the VIP ticket price been raised to $100 (only $25 more), the client would still have seen their tickets SELL OUT while taking in an additional $4,000 of revenue at no extra time, cost, or effort.
After the event, I found out that the Chairman was being pressured by his wife. (It happens and NOT the wife’s fault … it’s the human condition, and everyone is susceptible to peer pressure.) In short, one single person in the community complained to the Chairman’s wife about VIP ticket prices. That one complaint cost the event $4,000 of guaranteed revenue.
Your Profit Action
If you’re unsure of a ticket price, leave it in the court of last resort—your consumer! A simple solution to the above example would have been for the board to test two different price points with their consumer base. Technology now makes price testing seamless for the consumer and extremely affordable. However, you do need to know how to use this technology in testing. Let your customers vote with their wallets and tally the data.
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