Ask Me Anything Question
When should I discount?
Chris Fabiszak's Answer
Discounting can be an effective marketing tool. The correct reasons to discount are to:
- Help fill a house.
- Attract a new segment/demographic.
- Implement pricing corrections.
However, before you decide to discount to meet these goals, consider the following questions:
- Do you have a demand issue or a pricing issue? The answer to an undersold house is not always a discount. There may just not be enough patrons interested in seeing what you have on stage. Offering a discount in this case will reduce the revenue from those patrons who are willing pay full price and, depending on how steep the discount is, deliver a negative value message.
- How large a discount is necessary? Many organizations offer as much as a 50% discount—either themselves or via third party vendors. Patrons often appreciate the fact that there is a discount, and may respond just as well to a discount between 20% and 33%.
- Does the discount work for the organization? Any discount you offer should meet your organization’s needs. The patron receiving the discount should sit in the seat you want them to sit in for the performance you want them to attend. If a discount offer is not directly meeting one of the three goals, it should be nixed.
- What message is your discounting policy delivering? Constant discounting can train your patrons to buy on sale, devaluing your product. Selective, limited discounts can be valuable, but if you find yourself always discounting, re-evaluate your pricing and scaling approach.
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JCA Arts Marketing collaborates with cultural organizations to increase revenue, boost attendance and membership, and grow patron loyalty. We provide consulting and software services to hundreds of cultural institutions across multiple genres, including dance, museums, opera, performing arts centers, symphony, and theatre. We can help you achieve your marketing goals.
Chris Fabiszak is a Revenue Management Application™ (RMA) product expert and trainer with JCA Arts Marketing, as well as a consultant to such organizations as The Phoenix Symphony, American Shakespeare Center, SFMOMA, and Playwrights Horizons. His career began in nonprofit arts marketing, where he worked in audience services and development for The Clarice Smith Performing Arts Center at the University of Maryland, and then Washington National Opera in Washington, DC.