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Pricing Pulse | March 2019

Welcome to a new monthly wrap up on what’s going on in the world of Pricing, Behavioural Economic and Business Model Monetisation.

Unbundling of Airfares: The Endgame?

Last year, airlines in the US (American, Delta, United) introduced a new class of travel. For years, they have resisted the temptation to call the main cabin “economy” (preferring instead to call the back of the bus “coach” [sic]). But grab a “basic economy” ticket, and expect to have to pay more for seat allocation and even overhead locker space.

As the website Strategy-Business.com noted, this is a classic decoy product:

“The key to basic economy is not what happens to the passengers who accept it, but what happens to the many passengers who avoid it. By creating a class of service many passengers shun, basic economy appears to have made ordinary service seem less bad.”

Heavy Metal Subscription

You’ve heard of Willie Wonka’s “Golden Ticket”, but have you heard about Metallica’s “Black Ticket”? For $US598 you can get access to any one of the bands 30 US shows as long as you RSVP 48hrs in advance (I’ll do the math for you – that’s less than $20 a ticket).

The subscription is not available for their forthcoming Australian tour though. If you’re heading to their Marvel Stadium show in Melbourne on 22nd October, expect to pay anywhere between $382.09 and an astronomical $3,567.01 for the American Express “Dream No More” experience (Note the “nudge” to buy two of those $3.5k tickets?!)

Harry Potter and the New Business Model

If Metallica is not your cup of team, maybe “Harry Potter and the Cursed Child”, now playing at The Princess Theatre in Melbourne is.

It’s a performance in two parts, and ticket prices are much more affordable than those of Metallica. But could this be a new theatrical business model, where the time between the first installment and its sequel is minimised to days or even hours. This brings in revenue from “the sequel” much quicker than the traditional “Rocky 99” -type model. The same business model could also work in cinemas.

From all accounts, the first installment concludes with such a cliff-hangar, you can’t wait to see Part 2.

Cruising for WiFi?

Seen any interesting pricing lately? Hat-tip to Lauren Smith who emailed me details of Carnival Cruise’s WiFi pricing, from Florida. Does it remind anyone else of this scene from “The Dictator”?

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