Pricing Physical exercise Apr2015
SOLID RARE METAL AND FRESH HORIZONS: A PRICING EXERCISE
W. MORRISON ∗
1 . Introduction
You could have been asked to advise the Lanport Symphony Orchestra (a professional company) as to how they ought to price two concerts organized for next year. The initial concert entitled ‘Solid Gold' (SG) features the music of Beethoven, Mozart and Mendelssohn. The second live show entitled ‘New Horizons' (NH) features the music of Stravinsky, Schoenberg, and Cage. Each of the concerts offers ticket-holders admission to a reception (drinks and appetizers) which has a guest presenter, prior to the functionality. The reception costs will be the only costs that could be meaningfully allotted as a price per market member (all other costs are thought to fixed costs). The SG live concert will charm to fans of well-liked classics as the NH live performance will have even more appeal to ‘serious' traditional music enthusiasts and those who also prefer more contemporary and probably dissonant (atonal) compositions.
Howard, the band box-office and marketing supervisor has gave you profiles of 4 representative buyer groups and the willingness to cover the two types of live concert. Some of the orchestra's patrons are the Wolfgang Amadeus Mozart fans or since Howard calls them, ‘WAMs'. WAMs have a strong with regard to " light” classical courses and place a decreased value on most music consisting after 1900. Another well-known group of clients are the ‘Melody Lovers', who like popular classics but are prone to give more contemporary composers including Stravinsky a go. A third group of patrons will be the ‘Boomers', viewed perhaps relatively stereotypically since aging specialists who like going often , tend to be less picky when it comes to the actual content with the entertainment. The fourth and last group of representative patrons is exactly what Howard telephone calls the ‘Sophisticates'. This group is usually more knowledgeable about contemporary time-honored music and includes performers or customers who have spent some time learning or playing music....