Talking Tickets 24 June 2022: Richard Howle Drops Pricing Knowledge! The Commanders Discount Opening Day! NYC! And, More!
#141
Hey!
I’m in NYC from 26 June to 1 July. I’ve got some free time and if you are around let me know. We can grab a coffee or a drink.
Also, I’ll be back in NYC on 12 September for “The Whiteboard Workshop”. This was my most popular corporate event before the pandemic and I’ve reshaped it for individuals.
Here’s a bit of an outline:
Section 1: Understanding success, setting an ambition, and the importance of a living strategy.
Section 2: Developing your market. Identifying your buyers.
Section 3: The value proposition. Why you?
Section 4: Resources needed. Action items. Next steps.
The price for this is $300. Email me and I will get you set up.
If you dig the newsletter, please share it with your network and colleagues:
To the Tickets!
1. The Big Story: Richard Howle teaches us more lessons in commercialization:
Big Ideas:
Remember, price is a story. Are you telling the right one?
Inflation pressures are real. People are having to make decisions somewhere.
Some tickets are sold at prices that are loss leaders.
The dirty secret is that I will always share one of Richard’s stories because of any number of reasons:
He’s really focused on people and making sure that people are happy, safe, and entertained.
He’s super smart on this stuff and strikes a really smart balance in commercialization and customer.
Frankly, I think the world of him. He’s a wonderful man and I was so excited to see him in Birmingham in March, even though I felt like death warmed over.
So, this is a great piece and I can’t really add a lot to Richard’s analysis and our POV on this is also pretty similar.
I will point out a few things that I want you to pay special attention to though.
First, Richard points out that some tickets are “loss leaders” and that they are sold at prices that are below profitability.
From a strict profit/loss decision, this might make little or no sense to a lot of folks. But from a brand standpoint, let’s consider the implications these price points do a few things:
Assert that the theatre is for everyone.
Provide a better customer experience for everyone. A full theatre is a more fun and engaging theatre.
Gives the show a wider reach for both of the above reasons.
This leads me to the second point that your price is a story that you use to tell your market a few things about your game, event, or production:
Are you premium? Accessible? Or, something else?
Price can set expectations for the experience you are going to see. Think about the face value of Hamilton tickets and what kind of expectation and branding message they sent.
High prices or low prices can undermine all of this. So make sure you are telling the story that you want to tell.
Finally, the inflation concerns are real.
In May, the inflation rate in the UK was 9.1%. The US has been around 8% for I don’t know how long now.
I read an article in The Wall Street Journal this morning about Americans cutting back on their driving because they want to save money on gas.
These pressures are real because the period when wages were going up for folks is over and folks are preparing to deal with a recession.
So you have to keep all of these things in your head as you make decisions because people aren’t making buying decisions in a vacuum.
Are you going to take a vacation over buying groceries?
Are you going to heat your house or go to a game?
Are you going to buy your kid a new pair of shoes or are you going to go to the theatre?
You need to recognize that the competition for the fan’s spend goes beyond you or even other forms of entertainment…it is all kinds of things that you may not recognize.
Action Items:
Get out there and talk with your market: NOW! You need to know what is really going on right now. You can start with a few one-to-one conversations.
Think about what your price is saying to your market. Are you telling the right story?
Put some time in thinking about what would need to be true for your current way of doing business to still work understanding the environment we are dealing with right now?
2. The Road to Recovery: Discounts for Opening Day?!
Big Ideas:
The fastest way to destroy your brand is through price-based promotions.
“Discounts Are For Dummies” is my trademark statement.
There are many ways to avoid dropping a discount on Opening Day…that’s a new one, actually.
With this one, I’m in you see something new everyday territory: a 45% discount on Opening Day.
Obviously, as soon as I saw this one, I said to myself, “One piece of the newsletter, sorted.”
Pricing is the thing that most businesses seem to struggle with the most. I talk about it pretty consistently and I still see people just throwing discounts all over the place like it is going out of style.
The challenge with so many of these ticket discounts is that if you look at the face value of the ticket, even when you apply a 50% discount, the ticket is likely overpriced.
This means that you do three pretty terrible things from the jump:
You crater what demand you might have had because your market sees you throwing out a discount early in the sales process and begin to consider the question: “How low will they go?”
You undercut your brand because research and experience have taught me that the fastest way to destroy your brand is by using price-based promotions. You become a discount brand and that impression stays with you for years, that’s the scientific research of neuro-marketing which is the study of how your brain responds to marketing stimuli. (They will study anything.)
You kill your profitability. For every 1% in discounting you do, you lose somewhere between 10-40% of your profit.
I’ve tread this ground many times before. So I’m trying to think of a new angle to offer you.
So I’m going to give you 10 tips on better pricing:
Price=Value. Name something that you buy regardless of the price.
Price is about perception. Why do you buy an iPhone?
Demand isn’t created by the cold hand of the market unless you are a commodity. You aren’t a commodity, are you?
Price can indicate quality. Think Smythson until they started discounting all the time.
Price can give a sense of prestige to a product. Think Rolex.
Bundling can get you a higher price. Again, perception of value.
Unbundling can get you a higher price per piece. Think about single ticket sales versus a full season ticket. You get the higher price point from your single-game sales, yeah?
Price is a signal. No one hires the cheapest consultant.
Don’t base your pricing on your competition. The truth is that you probably don’t even know who your competition really is.
Do some pricing research. Experimentation, conjoint studies, A/B testing, the Van Westendorp pricing survey…whatever, just do something besides sticking your finger in the air and hoping that you make the best guess possible.
Put this to use:
Find out what your customers value. You aren’t your customer.
Do some pricing research. Find out what value your customers put on different things.
Experiment with your pricing, bundle, or unbundle things besides the ticket.
3. How To: Be a great podcast guest!
Big Ideas:
I explain how I developed my pricing philosophy, using gin!
Strategy before tactics!
We never really even touch the full range of experiences involving helping bust out a famous wine brand or my time on Broadway or in sports business.
“Call to Action” is probably one of the top 3 marketing podcasts in the world. Giles Edwards has been on “The Business of Fun”. When Giles showed up, we talked about proper marketing, Spurs, and all kinds of stuff.
So I was over the moon to be invited to record an episode of Giles’ podcast.
This episode covers a lot of ground. I even listened to it and I never listen to myself on these things.
A couple of highlights for y’all to consider:
First, we talk about how I started learning about pricing and it all began with gin. More specifically, with the question: “What kind of gin do you prefer?”
I can safely say that I have probably made over a million individual pricing decisions at this point from my time in nightclubs, bars, tickets, B2B services, and more. But it all began with that one question.
Second, I answer Matt from True Tickets’ question about strategy and I think I give an answer that will give you a good bit of understanding about why I tell you all the time: strategy before tactics.
Third, we talk about my path into “marketing” and how it all began with the customer. We even talk about this idea of a “good job” which drove me to focus on revenue through sales, marketing, and branding.
This is a winner and it is the second-longest episode in CTA history…so I failed in overtaking famous advertising man, Rory Sutherland’s record of having his conversation broken into two parts!
P.S. My dude, Rob Cressy, is launching a new cohort-based group around launching and building a podcast. TBF, minus the folks at Harris Blitzer, Rob is the reason I started ‘The Business of Fun’. So give this a look if you’ve been curious about launching your own podcast.
4. Tech/Tools/Profile: Time to Tackle the Touts:
Big Ideas:
When you look outside of the US, the attitude about resale is entirely different.
Like I talked about with Brett Goldberg a few weeks back, speculative tickets have gotten to the point where the only thing that comes across is negative.
Any change to any market won’t happen without enforcement. That’s a big if in any country right now, or, at least it feels that way.
I like to highlight these stories from time to time to show how much differently the conversation around the secondary market is outside of the United States.
This piece stuck out to me because of Adam’s comment about speculative ticketing being a fraud to customers. In my experience, there can be legitimate times to post speculative tickets, but the practice has gotten to the point where it could also be considered out of hand. This is where I settled down on it when I spoke with Brett Goldberg a few weeks back.
The most important point here is that we need to consider that no matter what situation we are looking at around ticketing or society that any good idea or rule is great, but it isn’t likely to go very far without some sort of enforcement. The incentives must be such that doing the behavior you desire is less painful or more enjoyable than the opposite.
5. Blurbs and Such:
MCG or Marvel Stadium? I’m torn. I love Marvel Stadium, but the Dees play at MCG. Let’s call it a draw.
For the advertising doesn’t work crowd: We don’t know the long-term implications of YOLO sports gambling, but some of the data coming out of the UK is pretty compelling. And, I’m sure we will hear more about the ways that gambling companies are find their ways to kids at younger and younger ages.
AB decides to go tactics before strategy: Y’all are going to read this and email me about how I’m missing the point, but the lesson of Les Binet and Peter Field’s study, The Long and Short of It is that you have to do both, long-term brand building and short-term sales activation. The talk about being everywhere is code for doing all sales activation. And, the data shows that if you only do sales activation, your sales fall off pretty quickly and radically. Maybe I’m wrong here, but the Super Bowl is one of the top events that you have to drive real brand awareness…controlling the beer and seltzer market of the Big Game is an opportunity that shouldn’t be discarded.
Without Title IX, Candace Parker wouldn’t have been a basketball star: I have a son, but the kid’s soccer club I’ve been coaching for years now has always had a few girls, even when most of the girls have moved onto the all-girls team. Having the girls around has taught me that focusing on leveling the playing field for them is still something that needs to get attention because in too many cases, the girls may not get the same equipment, field space, or coaching attention that the boys get. Obviously, we’ve been past the point where we’ve seen the power of women’s sports to make a positive change, but it is also good business as we’ve seen with the growth of the AFLW, WNBA, and the Women’s Champions League.
You can find me everywhere with my special Linktree! It is all my links!
Be a part of the ‘Talking Tickets’ Slack community.
Check out my friends at Booking Protect!
We continue to see the value of offering refund protection in the data. Feedback shows that the most challenging issues since re-opening have been pretty consistent for teams, theatres, and venues:
Consumer confidence
Changes in buyer behavior
COVID policies coupled with refund or exchange policies.
Offering refund protection helps you provide a solution for these challenges.
Hook up with the team at Booking Protect!
I did the FREE webinar a few weeks back but had some technical issues with the live stream on Microsoft Teams. I’m not sure if was Teams or my new desktop computer, either way…I’m going to continue to play with the tech stack and I posted the audio file in the podcast stream. So, pricing ideas to your heart’s desire.
Lots of great podcast conversations: check out recent conversations with Amanda Lester, Paul Williamson, and, Brett Goldberg.
Let me know who you’d like to hear from by sharing your ideas with me here.