The Added Value Playbook
Page 6
discounted deal. This slashes one of the sports marketer’s core arguments that, by experiencing the product at a heavily discounted entry, the customer can now be expected to pay full price when he nexts want to experience the product. Not only does the franchise not gain any information on the threshold marketing customer, they have now allowed that customer to brand their product in a way to where the customer knows that there are other avenues, aside from full price, to access the product.
If the sports marketer’s point was to simply gain more attendees without tracking by the franchise, why not just open the doors and let everyone in for free? It sounds silly, but it illustrates the non-seller, who does not understand why Big Data is of paramount importance in the franchise’s sales cycle. The non-seller’s version of events is that every transaction is passive, while the customer interest in the product is hard core. It is actually the opposite, as each sales transaction must be aggressively made, while the interest in the product by the majority of the customers is very passive overall.
The sports marketers and non-sellers tend to discuss the merits of threshold marketing on the basis of reach. They believe that threshold marketing companies have the ability to build hundreds of thousands of social media and e-mail customers, creating a large base of ready buyers for the franchise’s 50 percent off ticket deal. This is the sports marketer's laziness, and also that of the franchise, which would rather undercut itself in the long-term, rather than build a larger network of interested parties to develop..
If the franchise or sports marketer were that forward-thinking, they would be able to gain an additional 25 percent, assuming that the deal was always a 50 percent discount, as well as track the customers who purchased the product. They would also block out rampant discount hunters from receiving the deal more than once and create a traceable ROI system. This would involve some long-term planning by sports marketers at the franchise, as well as some forward-thinking by baseline budget people above them.
Losing customer data is inexcusable. It is worse than letting massive groups purge and topple the gates at 50 percent the normal price point. Non-sellers don’t understand this because they don’t do follow-up with customer data. They’re busy revving up the next heavily reduced price point ticket plan in order to “brand” more customers as discount hunters. In essence, they aren’t even providing the franchise’s sales department with a chance to build a fan base at full price without damaging it with their threshold marketing efforts.
This also drops the franchise’s per cap average further, down to 25 percent of the overall profit margin for those tickets distributed. And it may not even pay for the expenses of operation costs, along with other shadow costs, incurred by those discount hunters now entering the building. Sports marketers, however, do not consider this a worthy topic for discussion.
Does threshold marketing foster more than a one-time attendance bump anyway? Several small businesses, aside from sports franchises, have gone bankrupt trying to appease or service threshold marketing discount hunters. The only time those people appear is when there is a discount to be had. That is not a good cycle of financial stability for the franchise itself, which allows the discount customer to dictate what the price point is, rather than the regular customer who would pay full price. Except now they’ve been informed of alternative to pay at a reduced rate for the same product experience.