Category Archives: Pricing

Determining the role played by price levels, scaling, packaging and timing as well as attender combinations in purchase decision making in order to build profitable incremental revenue.

Market Penetration, Market Research, Marketing, Pricing

The Arts can Inform Sports Marketing

Boards of cultural institutions from coast-to-coast have asked for insights to help drive attendance, subscriptions/plans and contributions, leading to having assisted museums, theatre/repertory groups, opera companies and symphonies.

Usually, the learning highway runs from sports & live entertainment to the arts groups. But the art of arts marketing is becoming increasingly sophisticated.

We helped one long-standing musical theatre organization better understand its own market segmentation so that it could increase the appeal of its show offerings and the effectiveness of its marketing programming/message persuasiveness and get more pop for its always constrained resources.

Drawing on a battery of focus groups and audience surveys we conducted, the following segmentation was developed and embraced.

Heydays . . . These were patrons introduced to musical theatre during the 40s through 60s. They enjoy seeing the great shows of that Golden Age. These might include Sound of Music, Fiddler on the Roof and My Fair Lady.

Experientials . . . These patrons were drawn to the downtown, enjoying the 360º experience – “dinner and a show” at an affordable price.  They look for quality, appreciate convenience and reasonable pricing. Their interest is not tied to a particular show but respond to valued added experiences.

Escapists . . . These patrons seek relief from day-to-day demands.  They like memorable music, high energy dance, shows that fill the theatre and predictable plots. Shows they enjoy include 42nd Street, A Chorus Line, Evita, Les Misrables and West Side Story.

There are two sub-segments that flow from the first three . . .

Melodics . . . This group is comprised of a broad range of individuals whose love for musical theatre stems from a positive, early life experience with music. Many were introduced to musical theatre by their parents.

Loyalists . . . This group is very supportive of the theatre company and its long term audience growth challenges, even though they may not like the “risky” shows periodically produced to attract a new audience. It always finds something to like about each show.

Capitalizing on insights like these increases productivity and results. Count on it.

 

 

Innovations, Market Penetration, Market Research, New Revenue, Pricing, Product Development

Premium Seat Pricing Born

 

 

Sandy Alderson (President, above)/ Andy Dolich (Executive, left) – Oakland A’s . . . The former (now General Manager of the New York Mets) and latter (most recently COO of the San Francisco 49ers) demonstrated bold business vision in the mid 1980s when they commissioned me and colleague Bob Hallam to evaluate the relationship among ticket demand, pricing and perceived value, an engagement that led to the dramatic upward rescaling of “box” and “reserved” seats, ushering in the concept of premium seating throughout Major League Baseball.

The notion of pricing tickets relative to demand, a long-standing practice of the airline industry, had spread across Major League Baseball within three years of the A’s taking action. The neighboring  San Francisco Giants were the first to follow suit. The precursor of flex or dynamic pricing , tailored to day-by-day demand, weather, day-of-week, opponent and other variables, was a courageous move.

An important part of its effective execution was the messaging to fans most directly affected by the changes and communication of the reasoning behind the changes.  Not all fans were pleased, but the appropriateness of the philosophy was born out by the sustained results and overall economic benefits. Ironically, the Giants have been at the head of the flex-pricing class.

Lessons learned here have implications far beyond the live sports and entertainment business into the realms of tiered TV/cable and web-based subscriber services.

Branding, Market Research, Marketing, New Revenue, Pricing

Precursor of Seat Licenses

John McMullen (Owner – New Jersey Devils) . . . Then also the owner of another client, the Houston Astros, McMullen retained us (including colleague Douglas K. Nelson) to (a) help re-launch his newly born New Jersey Devils National Hockey League club (formerly the Colorado Rockies) 60 days before its opening puck-drop, (b) restructure its pricing and season plan packaging 30 days after the original plan had been announced and (c) recapture his personal credibility with the New York media. Top tier season plan buyers were given access to the nearby Pegasus Club in return for a front-end long term loan to the club, inadvertently foreshadowing seat licenses.

How the first 30-60 days of a new ownership are managed can have lasting implications for the marketing of a sports franchise and how fans, media and prospects view not only owner intentions but the brand personality.  Faltering first impressions are costly to reverse.

Market Research, Marketing, New Revenue, Pricing

Horse Racing Insights Pay Off

Edward DeBartolo Sr. Owner – Thistledown/Louisiana Downs/Balmoral (subsequently sold before opening of Remington in Oklahoma City) race tracks . . . Hired our firm to develop a factual understanding of patron attitudes, behavior, satisfaction levels and geographic dispersion so that marketing efforts could more effectively address how to increase the visitation frequency of light attenders and profitable high spenders, affectionately called “degenerates”. He immediately grasped the parallel between building shopping mall traffic (the foundation of his business interests) and attracting/serving race track patron

Market Penetration, Market Research, New Revenue, Pricing

Understanding the Hispanic Community

Jackie Autry (Owner – California (now “Los Angeles”) Angels) . . . Not satisfied with having attendance stalled, win or lose, at the 2.5 million level, Autry retained us to understand the decision making dynamics of light and heavy attending Angels fans, including focused attention on Hispanic communities,  in order to increase marketing and ticket sales effectiveness and productivity. Her customer service consciousness, bred of her experience in banking, was among the highest in the entire pro sports industry.

The structure of the Hispanic community, reinforcing what we had learned when working with the Houston Astros, highlighted the importance of engaging community leaders, informal and formal, including religious, political and small business principals. A key hurdle we discovered that had to be overcome was the issue of “trust” and “commitment to diversity” reflected in the team’s and playing facility’s hiring practices.