Practical Price Theory in Practice (December 6, 2010)

. . .

L          “So you want to maximize attendance?”

M          “It’s a polemical movie.  We want to get as many eyes and ears in the seats as possible.  We have already committed the funds to rent the theater and the movie.  Student volunteers are running it.”

L          “If you offer the movie for free, it may not be worth anything.  Only the committed will attend.  Why not make the movie valuable.  The price of similar movies on campus is three dollars whereas in my day it was one dollar.  State that the cost of a ticket is 25 cents and then print ‘SCHOLARSHIPS AVAILABLE’ in a large font on the pamphlet to entice interest.”

M          “It could peg the value at a quarter and thus not worth considering.”

L          “It might.  And you don’t want to dissuade someone who may not care about the money but does not want to be hassled searching for a quarter.  When someone asks what must be done to obtain the scholarship, ask him or her to state in 25 or fewer words what the movie means to him or her.  Pause and then agree that they are deserving of the scholarship.  Call it ‘Two Bits Production’.”

. . .

M          “We did attract far more viewers than we expected and made some money.  Because of the delay in the line for those seeking scholarships, we set up a second table to conduct the interview, streamlined it to twenty-five seconds and kept the conversation light.”

L          “Super.  It was raining outside that night which may have kept some at home or, if they left the house, drove them inside.  And nothing else was playing in town that night that would appeal to the demographic.  Keep up the experiments.  And keep up the reports.”

. . .

Bumper stickers of the week:

“A cynic is a man who knows the price of everything and the value of nothing.”  Oscar Wilde

“At the usual daily rate, The Wall Street Journal would cost $999 for the entire semester, but you can subscribe today and today only for the low, low rate of 25 cents a semester.”

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