Hi!
This is a case study I did from a recent bit of pricing work.
I’m a bit tired after taking the boy to see his first concert last night, Tyler the Creator.
He gave it a 9 out of 10.
Case Study
Arts Organization Pricing Strategy
Challenge: Non-profit had never done any kind of pricing research or pricing strategy in its history.
The organization was basing decisions on previous years, assumptions, and guesses.
Action: We undertook a thorough investigation of previous years pricing and put the non-profit’s pricing in context of the larger market, the unique nature of the organization’s offerings, and an emphasis on the value that the organization provided to communities of all economic levels.
We also did market research to better understand the context of the organization’s offerings against the alternatives in the market.
This enabled us to highlight the reality that the competitive group wasn’t competing shows, but also things like dinners, shopping, or not coming into the city to see a show.
Results: After reviewing the previous year’s pricing decisions, we undertook the following course of action:
- We cut the number of price points from 26 to 7. This gave the organization greater control over their pricing and enabled more pricing based on value instead of arbitrary boundaries set up by partners.
- We used the organization’s goal of making their major performance accessible to all by setting a “$20 at every performance” price achieving a goal of accessibility while also having a key messaging tentpole for advertising campaigns.
- We changed the organization’s ad targeting to be less generic and more specific, based on behavior, to enable the organization to reach a larger potential market at a “premium” price point.
- We uncovered a huge demand gap that was age based, highlighting the importance of brand building activities that were targeted at younger adults, new families, and non-traditional attendees.
These actions allowed us to restructure pricing in a way that would achieve a 15% increase in revenue from the historical ticket sales average while expanding the potential audience including new audiences and underserved communities.
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