The hole in the story

It's been interesting to see how issues of pricing and the performing arts have come back to life in the internet and beyond. 

This isn't about whether a particular price point is to high or low.  I've got my feelings on that and I'm sure you have yours . . . but that is always going to be up for debate.

This about the narrative.

Behind every successful movement or organization there is a story.  It's built on words and on actions.  The key is making sure that the various components of that story make sense.

So the real question is whether your price and pricing strategy fit with the story you are trying to tell the world?  If it doesn't, it blows a hole in the story.

I think this is a particularly important thing for nonprofit arts organizations to consider because we depend on more then a ticket transaction. 

We depend on certain people loving us enough to donate significant sums of money and be ambassadors of what we do.

It's those sorts of people who are the mostly likely to look closely at how an organization operates.  It those sorts of people who are most likely to find the holes in your story.  When they find them they aren't going to yell and scream about it . . . they are simply going to move on to another group whose words and action more closely align. 

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What I find most frustrating about this price conversation is that we don't put it in the context of the overall story being told.

Right now we just pull out a tactic, start shouting MORE REVENUE, MORE REVENUE and then watch as people flock toward it.

But how many groups, in how many industries, have been crushed because they jumped on a short term revenue bump without thinking about how it impacted the entire picture?

That's my real concern.  It's not the specific price point.  It's the semi-desperate "we will do anything to make a few extra bucks" vibe that I sometimes see surrounding these things. 

So I hope that as we continue this conversation about price that we don't let fear, or short term thinking, stop us from giving these matters the full consideration they deserve.

 

 

 

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Comments

[Eric Ziegenhagen]

In Chicago, and probably in every major American city these days, the culinary arts scene is full of successful examples of this.

Hot Doug's: Gourmet chef opens a hot-dog stand. The whole quality+egalitarian+funny nature of the place, and of Doug Sohn himself, comes across in the pricing as well: franks for a dollar, polish sausage for $3, elk and alligator and rabbit for around $7.

Alinea: Aspiring chef apprentices with Charlie Trotter and Thomas Keller, then sets off on his own to create a completely otherwordly experience, literally creating food that has never existed before through technology and imagination. Dinner can run $250 a person, but it's meant to be a once-in-a-lifetime experience, something that promises to be memorable for a lifetime.

Schwa: Gourmet chef has the talent and training to be a Trotter or Achatz, but doesn't want to "play the game." Opens a small storefront where he and the sous-chefs also serve the food. Dinner runs something like $55 for three courses or $100 for five. BYOB.

Hard to get a table at any of these three. All three have made it clear that the price is right. And since these are for-profit businesses, not 501(c)3 organizations, the investors and the culinary artists themselves can benefit from the success.

I can't imagine that theater, by its nature, has to be different from this.

[Adam]

Agreed. I think restaurants are great examples of using food, price, atmosphere, etc. to tell a complete and compelling story. Of course I think the performing arts should be doing this. I just think we have to encourage our peers and colleagues to think about the entire picture/story

[Chris Ashworth]

Heh. Funny, I would have used many of these points to argue the opposite conclusion. :-)

Can a failure to look at the whole picture be what prevents people from properly getting more revenue out of their pricing strategy?

How many groups, how many organizations, bleed themselves to death on a "sacred" pricing strategy that isn't producing enough revenue?

How many organizations let fear of different prices prevent them from finding better prices?

[Adam]

Chris,

You could absolutely look at the whole picture and decide that dynamic pricing is a good idea. My point is that the entire picture should be looked at and to me the entire picture (particularly for a nonprofit arts org) is more then the economic outcome.

I noticed on your blog how you used dynamic pricing for your software and it worked out very well. Hell, even my own (for profit) consulting has different pricing tiers. But in a nonprofit arts org it's about both sides of the ledger . . . the ticket sales transaction and the donation . . . and I hope people consider how one thing may impact the other.

And again, maybe an org looks at it and decides that dynamic pricing creates a net positive. They could be right. All I'm saying that it requires a serious conversation.

[Chris Ashworth]

Right on. :-)

Sidenote: I'm not sure that my pricing for QLab technically qualifies as dynamic, unless rentals qualify. The standard licenses are tiered, but they stay constant.

Cheers,
C