Develop a foundational knowledge of
PRICING to understand its role in
marketing
IDENTIFY
FACTORS AFFECTING PRICING
and
PRICING ISSUES
OF SEM
FACTORS AFFECTING PRICING
OF SEM PRODUCTS
•
LEAD TIME
•
MARKET DEMAND
–
How much of a product customers will buy at a certain price
•
MARKET SEGMENTATION (TARGET MARKET)
•
SMOOTHING
–
Dividing product into different segments:
• Time: Pay more money for “Prime time”
• Place: Pay more money for Court-side seats and less for nosebleed
•
RESPONDING TO COMPETITORS
MARKET DEMAND
PRICE ELASTICITY
:
–
Measure of how sensitive customers are to
changes in
price
•
Gauges relationship between
market demand and price
–
INELASTIC DEMAND
•
Price changes have
little to no impact sales
–
ELASTIC DEMAND
RESPONDING TO COMPETITORS
•
2 Types of Pricing Strategies:
–
PENETRATION PRICING
•
Setting prices lower than the competition
– Used to introduce a new product or to encourage maximum participation
–
SKIMMING
•
Setting prices
higher than the competition
PRICING ISSUES
•
COST
–
Cost of production for good/service
• If cost more to produce an event then revenue from ticket sells prices = have no business
•
VALUE
–
What are the
PERCIEVED BENEFITS
to consumers?
• Unique perception of each person
• PERCEIVED BENEFITS:
– TANGIBLE: Physical benefits (i.e.: Buying a surfboard with an ankle-band) – INTANGIBLE (i.e.: Buying a surfboard to spend time with friends at the beach)
•
OBJECTIVES
–
What are the goals of the good/service?
DIFFERENT PRICING OBJECTIVES
Company-Focused
Competitor-Focused
Customer-Focused
•
Pricing products to
ENHANCE THEIR
IMAGE
•
COVERING COSTS
•
CREATING PROFITS
•
OFFER LOWEST
PRICES
•
DISCOUNTS
Offering the
MOST
TICKET PRICING STRATEGIES
•
SCALING THE HOUSE
–
Pricing tickets differently based on
•
Location of seat
•
Time of purchase
–
YIELD-MANAGEMENT PRICING
•
Maximize revenue with venues with limited capacity
Employ sales-promotion activities to
inform or remind customers of business/
SALES PROMOTION
•
STIMULATION OF SALES
achieved through contests,
discounts, giveaways, special offers, and similar activities
•
SALES PROMOTION is a major part SEM
–
INDUSTRY IS SO HIGHLY COMPETITIVE
• Customers have endless possibilities to spend money
• Helps customers decide to spend that money with them over the
competition
– Use Athletes as a product to help sell
•
“OUT-OF-THE-BOX” Sales Promotions
–
NO PARTICULAR TECHNIQUE-
UNIQUE!!
OUT-OF-THE BOX
STEPS
•
STEPS:
– PREPARE FOR INSPIRATION • Know target market
• Knowing your competition
– means taking their ideas and improving on them
• Putting a new twist on an old idea
• Brainstorming
– DETERMINE INCENTIVE
• "What does this sales promotion offer to customers?"
– A chance to save money? A free sample or gift?
– DETERMINING DELIVERY
• "How will my customers receive this sales promotion?"
– Deciding how to "package" the incentive
– DETERMINING HOW TO GET THE NEWS OUT
TICKET SALES CAMPAIGN
•
Sales campaign to
encourage the sale of tickets
to a certain
event
•
IMPLEMENTATION- must consider:
–
IMMEDIATE ACCESSIBILITY
• Consumers expect to order and pay for tickets right away
–
THEME
• Make the campaign unique and stand out
–
TECHNOLOGY
• Most consumers purchase on the internet
PREPARING SALES PRESENTATIONS
There are four questions to be answered before you can begin to prepare:
1. Why
are you saying it? -
PURPOSE
2. To whom
are you saying it?
CUSTOMER PROFILE
1. In precall planning, the salesperson focuses on learning more about the
customer
3. What
are you going to say?
– CONTENT
– WRITE A SCRIPT
PURPOSE
1. Communicate Information
2. Make a Proposition/Sell
a product or idea
3. To
Inspire and Motivate
CUSTOMER PROFILE
CUSTOMER PROFILES DETERMINES A PROSPECT'S
NEEDS
–
Consider how much they know already
–
Establish the Characteristics
CONTENT
1.Decide on your
APPROACH
–CUSTOMER-BENEFIT APPROACH
•Ex: Asking if customer would like to save money on office supplies
•Use questioning to exemplify product benefits
–Introductory approach
•Simply state name and reason for presenting
2.Summarize the
objectives
of your presentation
3.List points
you need to cover
WRITE A SCRIPT
•
A script is used to:
–
JOG MEMORY DURING PRESENTATION
• Help to remember key points that they want to cover
–
Plan presentation length
–
Practice
before presentation
•
When writing a script make sure language is
–
POSITIVE
–
PRECISE (short)
–
PERTINENT (Meaningful to the customer)
ESTABLISHING
A
GOOD RELATIONSHIP
•
WHY ESTABLISH A GOOD RELATIONSHIP:
–
BUILDS LONG-TERM LOYALTY
•
Supportive
even with
controversy or a losing season
•
HOW TO DEVELOP LONG-TERM RELATIONSHIP?
–
BUILD EMOTIONAL CONNECTIONS with customers
•
Spectators driven by the emotions and experiences
– Influenced by tradition, attitude, and team performance
–
Provide customers/fans with what they want and
expect
STEPS
to
EFFECTIVE SALES OPENINGS
You only have 1 chance to make a first impression!
1. KNOW
your customer before initial contact
–
RESEARCH their company website
2. Have a PLANED AGENDA to discuss
–
DON’T call without preparing what to say
3. CUSTOMIZE the sales script
–
Don’t read a general script for each customer
4. ASK OPEN-ENDED QUESTIONS
–
Find out what customer needs/wants
5. CLOSING LINE: Ask for the SALE!
EFFECTIVE
WAYS TO SELL TICKETS
GOAL: Sell-Out your event to make MONEY
If you don’t make up the costs of the event-LOSE MONEY
•
LOTTERY SYSTEM SHOULD BE USED IF:
–
DEMAND IS HIGHER THAN THE AVAILABLE SUPPLY
–
A drawing in which people are given equal chance to win
•
Word of Mouth
•
“EARLY BIRD PRICING”
–
One reason it is important for professional sport/event
organizations to develop advance ticket sales plans is because the
generated revenue helps organizations to cover pre-event
expenses.
