Archive for 2011
Broadway for 2 at $700? Dynamic Pricing Keeps Expanding
$700 is the price a couple would pay for the best seats to see Hugh Jackman Back on Broadway this month. With a runaway hit, producers have raised prices several times. Orchestra seats that were priced at $155 are now priced at $175. Premium seats that were priced at $250 are now priced in the range of $275 to $350, depending upon demand for specific performances. Their decision to use dynamic pricing has placed Hugh Jackman’s essentially one-man-show in the top earner position on Broadway with roughly $1.5 million in ticket sales for the week ending November 20th, 2011.
With pricing success like this, one can suspect that more executives may benefit from considering the value of dynamic pricing.
Read MoreTop 6 – December 2011
To Marek Matějka, herec, dobrý muž, i camarad, I will miss our zábavný večer. 2 October 1974 – 25 November 2011 Not everyone values you, but some do. Love the one your with. I am speaking about customers you know. With sluggish economy and growing disparity, underdog branding might be in order. TS: “food, housing,…
Read MoreThe Merits of Underdog Positioning
For some reason, consumers often find the underdog more attractive than the category leader, according to research done by Harvard Business School Professor Anat Keinan. In this article, we examine some of the drivers that makes underdog marketing successful.
Read MoreEffective Price Segmentation Techniques
In order to fully capture potential profit contributions, a firm must be able to successfully execute price segmentation tactics on a consistent basis. Faced by a dynamic market, firms require regular price maintenance to ensure segmentation hedges remain effective. Efficient price discrimination techniques that involve limited cost to identify market segments and mitigate the existence of a secondary market, truly contribute to a firm’s bottom line. Understanding the theoretical concepts of price discrimination discussed in a standard economics textbook only scratches the surface of the knowledge needed to implement a profit generating pricing strategy. This article will attempt to provide the connection between pricing theory and where the rubber meets the road.
Read MoreKilling the Golden Goose – Part 2
Reed Hastings, the CEO of Netflix (NFLX) has cemented his position on my Hall of Shame. Whether hubris (outrageous arrogance) or stupidity, Netflix has taken an ill-advised price increase and transformed it into a runaway train that threatens to jeopardize the company. The story began when Reed Hastings and his management team, after doing apparently no market research, decided to raise their prices by approximately 60 percent. This action was taken amidst a continuous stream of record earnings, customer loyalty and a growing customer base.
Read MoreThe Coming Convergence of Alternative Payments and Digital Marketing Strategy
During October, I had the distinct pleasure of attending the BAI Retail Delivery Summit 2011 and the 3rd Mobile Contactless Payment Innovations Summit. These shows discussed various aspects of banking and payment convergence with digital mobile devices. The majority of the presenters focused on the technology and near field communications issues. But there were a few speakers who had different perspectives.
Read MoreTop 6 – November 2011
“The only profit center is the customer” Peter Drucker Corporations are psychopaths? Pricing errors, specifically price communication errors, are deadly for career and corporation. Witness Reed Hastings & Netflix. Corporations are people? One person’s blunder is another’s opportunity. Corporations serve needs? All of the above or pick & choose.
Read MoreOccupy Movement and the Existential Purpose of a Firm
Why do firms exist? Why should society allow corporations to exist? What moral reason should we, as a society, allow firms to exist? At the most fundamental level, the Occupy movement is asking this question. Shouldn’t we be addressing this?
Read MoreSales vs. Pricing and Strategic Accounts
Salespeople abuse discounts. Pricing is the sales destruction department. Well, which group is right and must they keep fighting? In this article, we explore the role of price segmentation in strategic account selling.
Read MoreTop 6 – October 2011
In America, we teach our kids how markets work at a very early age. It’s called Halloween. Pricing vs. Sales – “Can we all get along?” Rodney King, 1 May 1992. Arrogance is an STD (socially transmitted disorder) – very contagious and deadly. If you only talk to purchasing agents, you aren’t in sales. You’re…
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