Jennifer Sowinski
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Grow arts and culture revenue

Ask Me Anything: Airlines and Dynamic Pricing

Ask Me Anything Question

"People often reference the airlines' dynamic pricing model when we talk about using dynamic pricing in our theatre. Is this a fair comparison?"

Jennifer Sowinski’s Answer

Not exactly. 

Airlines have been using dynamic pricing longer than most other industries, and customers are used to the idea that the price of an airline ticket can and will change over time. They understand and accept that a flight leaving tomorrow will be a different price from a flight three months from now. At the same time, they expect the price of most goods (a paperback, or a soccer ball, for example), to remain the same regardless of when they purchase it. This is why that's a common comparison.

But, the major difference between dynamic pricing in theater and airline tickets becomes apparent when you consider the value proposition of each service. Customers purchase plane tickets because they need to travel from one city to another. The decision to purchase a flight is almost always out of necessity, and the value of their purchase is clear. The customer has been moved from where they started to a new location, and has paid what was necessary in order to achieve that goal.

In contrast, the value of a theater ticket is not as tangible. In fact, it is determined entirely by the customer’s perception of its value. Airline tickets are bought out of necessity, but performance tickets are purchased because the buyer believes that the experience is worth their time and resources. Few productions have the luxury of continually raising ticket prices and expecting demand to remain the same—and that’s where the comparison falls short.

The perceived value of a theater ticket can vary drastically from person to person, and the actual price is only one piece in that puzzle. The perceived value of a theater ticket comes primarily from a customer’s own personal experiences. Arts organizations should also do what they can to keep the perceived value of tickets high. Things such as utilizing appropriate scaling and reigning in discounting can all help the value perception of tickets.

Do you have a question for the team at JCA Arts Marketing? Submit it here. It could be featured in an upcoming Ask Me Anything post.

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.

Jennifer Sowinski, Consultant, JCA Arts Marketing

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