The perils of discounting

Tuesday, September 28, 2010 6:23 AM

Forgive me for using a UK example, but it's what I'm basing the thread on. Take Thorpe Park, for example.

Gate Price: £38 ($60USD)

If anyone pays that amount they are quite simply a fool. A few months ago I went a pretty long drive and during the journey I bought petrol, newspaper and a BK meal. With each of those purchases I got a half price voucher for any Merlin attraction (Alton, Thorpe, Chessington etc).

Not only that - but you can return to the park the following day for just £1 ($1.60)

So the 'standard' price for entry to those parks is now £19 ($30USD). By their marketing strategy I would now feel as though I was being ripped off if I had to pay the full amount which one day - must surely be inevitable?

When you have paid less than $32 for two days in a park - you do have to wonder how the public would react when asked to pay $100.

I wonder how much per-cap spending is affected when entry is discounted to this level - if not much, perhaps we'll never see an end to discounts like this?

+0
Tuesday, September 28, 2010 8:20 AM

I've been to Thorpe Park a few times whilst across the pond - I don't even think it is worth the 19 pounds/$30 US - but that's my opinion :-) I would rather head over to Germany or Spain - flights on Ryan Air and other carriers make this more attractive to me.

But back on topic - Once you go down that evil path of discounting - it is very hard to step off. If anything it certainly leaves a bad taste in everyone's mouth.

+0
Tuesday, September 28, 2010 8:43 AM

This is true of all business. If you start discounting and then stop, the results are often much worse then the gains derived from the original discounts.

+0
Tuesday, September 28, 2010 10:18 AM

The key is not to discount the gate, but to create other incentives for guests. Include a free meal, or a t-shirt, or free admission to an up-charge attraction. And advertise this as a 'free, limited time offer, so hury'. Then we the offer goes away, you don't have the same backlash as raising prices.

+0
Tuesday, September 28, 2010 10:35 AM

^Agree 1000%. BTW, I absolutely LOVE your profile pic! There are not a whole lot of coasters out there I'd ride instead of TSMM.

+0
Tuesday, September 28, 2010 11:32 AM

I suspect it's a long term strategy. No one is ever going to be pissed because the real gate price is £19, not £38.

Kind of like what Six Flags does here in the US, they list the gate as ~$50, but it's pretty tough to actually pay that much to get in.

I think the idea is that listing the price at the higher level makes the 'real' price seem like a deal.

+0
Tuesday, September 28, 2010 11:38 AM

Kind of like Disney and extra days...

+0
Tuesday, September 28, 2010 11:39 AM

Yeah, I follow - I just don't get how you can lower the value of your product to that level and ever hope to raise it.

+0
Tuesday, September 28, 2010 11:41 AM

As crowded as Thorpe was, lowering the gate price seems like a move in the wrong direction...not sure if that's clockwise or anticlockwise, LOL... ;)

+0
Tuesday, September 28, 2010 11:57 AM

Rick_UK said:
Yeah, I follow - I just don't get how you can lower the value of your product to that level and ever hope to raise it.

The same way anyone pushes their rates, by raising the "list" price too.

If the list goes up, so does the 'discounted' price.

+0
Tuesday, September 28, 2010 12:03 PM

Yeah I guess, but a certain number of visitors (especially tourists) continue to pay the list price, surely it'll hit a point where they won't pay. I follow what you mean though.

+0
Tuesday, September 28, 2010 12:04 PM

I also think the few people who actually do pay the actual gate price are too oblivious to know there are discounts out there. As far as they're concerned, everybody else paid the same price they did. Ignorance is bliss.

+0
Tuesday, September 28, 2010 12:08 PM

Like RGB said, I suspect there's a segment paying it now. Assuming it's a steady and reasonable climb, there's no reason to assume they wouldn't in the future.

I mean, if someone would have told us 10 years ago what we'd be paying to get into the parks today, it would have seemed high then, but everyone pays it now. Just like we'll all pay the 2020 rates that will make today's prices seem crazy-low in hindsight.

+0
Tuesday, September 28, 2010 12:21 PM

Lord Gonchar said:
Like RGB said, I suspect there's a segment paying it now. Assuming it's a steady and reasonable climb, there's no reason to assume they wouldn't in the future.

Curious if you think enthusiasts make up a reasonable percentage of that segment? I know I do if I am visiting a park as a quick side trip. I know I could save $10-20 if I found a McDonalds near the park but I would rather buy my ticket on-line and have it in hand than looking for a cheaper ticket the morning I go to the park.

+0
Tuesday, September 28, 2010 12:32 PM

Shades said:
Curious if you think enthusiasts make up a reasonable percentage of that segment?

No idea.

Perhaps there's a sub-segement of enthusiasts that value convenience over price like yourself who do pay more than they have to.

However, keep in mind most parks 'discount' their online tickets to some degree as well. So it's still not "full price' in most cases.

The only people that I would think are paying the list price are those that walk-up to the gate and purchase a ticket.

+0
Tuesday, September 28, 2010 12:49 PM

I would think enthusiasts would be the ones searching for discounts. We're much more familiar with the usual suspects (coke cans, fast food joints, online) and we have additional resources (this forum) to find discounts. The added effort to find a discount is probably significantly less than it is for the GP. Hell, when I was planning my trip to KI for memorial day, a link spontaneously popped up in one of the forums for $25 tickets.

Then again, we're also spending thousand of dollars to get to a park, so what's another $20?

Last edited by ApolloAndy, Tuesday, September 28, 2010 12:51 PM
+0
Wednesday, September 29, 2010 1:54 PM

And people wondered why auto sales dropped so drastically after the cash for clunkers program ended.

+0

You must be logged in to post

POP Forums - ©2018, POP World Media, LLC
Loading...