Monday, July 26, 2010

The Value Of Price Discrimination

There are times when offering a price differential can be of great use as a marketing tool for businesses - when it is done legally and ethically, of course.

This morning I was thinking of asking my in-laws to do something for me on Wednesday afternoon. Then it hit me. They will probably decline because Wednesday is 'Movie Day' for them! Why is Wednesday 'Movie Day'? Well, because the movie theater offers a special discount to senior citizens for Wednesday matinees when they use their "Golden Buckeye" card - a state-issued card for people over 60 years of age.

My in-laws have been retired for a few years now, and pretty much every Wednesday they go to the movies at a discount. Sometimes they even see two in a row! And why? Because it gives them something to do that is enjoyable for both of them, and they are getting a significant reduction from the regular price of a ticket.

Clearly, this discount is a great benefit to older people. But, is this really beneficial to the theater? If my in-laws like movies so much, wouldn't they go anyway at full price? Isn't this lower pricing taking away revenue the theater could get from selling seats to other age groups at full price? The answer to the first question is a definite YES. The answer to the last two is a firm NO.

Now my father-in-law enjoys movies a lot. But, I can say with confidence that he would almost never go to the theater to see a movie if he had to pay full price. The same is true with other businesses that accept the Golden Buckeye card, such as restaurants. He will go to these restaurants, and go more often because there is a discount involved.

The reason this is such a good marketing tool is because the program brings in customers that the business would not normally attract, and often during non-peak hours that struggle to bring in customers at all. In the example of movie theaters, Wednesday afternoons are a time that few people patronize. Employees are still working, popcorn is still made, movies are still showing, and electricity is on even if moviegoers are not there. So, by offering a discount to seniors during this off-peak time, the theater attracts patrons who are often retired (meaning they have time and money to spend in the theater during the day) to be their customers when they normally would have few.

A discounted ticket plus refreshments equals increased revenue for the theater, and happy seniors who enjoyed their afternoon with a price cut. Increase profits by offering a lower price. What a great idea!!

Monday, July 19, 2010

Bill Hicks On Marketing

While watching a bunch of stand-up clips from comedian Bill Hicks over the weekend I came across this bit he did about marketers. I actually find it more interesting than funny - though it is funny.

If you are familiar with the kind of comedy Hicks did, you know that he was often critical of things like consumerism, conventional unquestioned thought, and the 'ruling class'. So, you may not be surprised that marketers would be on his list of people to despise.

Ultimately, I think he has a legitimate point about those that constantly research, segment, and profile in order to peddle garbage to consumers. Their goal being to convince the consumer that whatever product or service they offer will help to fulfill them once consumed, and is not, in fact, useless garbage.

I, myself, strive to use the art and science of marketing in my career to do something a little more meaningful and helpful to the public. I feel as though many other marketers do too - and have genuinely useful products and services to offer. Not everything is garbage, and there are some things which people need, correct? Though, competition and capitalism has the ability to reduce marketers with my intentions to the 'scum' of which Hicks speaks. Ha!

Anyway, enjoy the clip below, and let me know what you think of it.

*Also be warned that this clip contains a lot of profanity.

Wednesday, July 7, 2010

Coca-Cola's Marketing In Korea

This is an interesting article I just read about Coca-Cola's attempt to utilize social media as a way to introduce their products in new territories with Internet access, and build their brand with the help of influential bloggers.

From this, it seems Coke is really staying in front of changing opportunities in marketing. They are actively (and, apparently effectively) using all of today's tools to not only expand their visibility and reach in current markets, but to establish relationships in new ones.