October 8, 2009

Holistic Offers = Premium Pricing

The market is being flooded these days with product or service bundles that try to capture the imagination of consumers who are spending less in these challenging economic times. Chapter 26 in my book discusses the practice of creating Holistic Offers and how they differ from the ubiquitous bundling activity that we are seeing.Telecom companies bundle wireline, wireless and customer calling services and banks bundle mortgage rates, savings accounts and investments.

I discovered an example a while back of a rather creative Offer that provides a learning opportunity for those on this marketing path.

The White Spot restaurant in Vancouver has created the ‘White Spot Family Nights’ Offer that consists of the following components that I obtained from the Giants website:
- 4 tickets to any Fri/Sat/Sun Vancouver Giants hockey game
- 2 Legendary Burger Platters
- 2 Pirate Paks
- 1 game-night parking pass
- $10 gas coupon from Chevron

I am impressed with the engineering of this offer to include the basic components necessary to meet the needs of a family who attend a hockey game. My hats off to White Spot for putting this together and for extending it to include outside partners such as Chevron. That’s the good news; the opportunity to learn and improve it, on the other hand, lies in the way they priced it and promoted it.

The ad on the website (and also the on-premise poster ads that I have seen in the individual stores) priced this Offer at ‘Only $89 ($130 value)’.

Roy’s BE DiFFERENT suggestions for improvement:
- Increase the price point; I think it is too low given value considerations and also the marketing effort that goes in to integrating an Offer like this that involves with multiple external parties.
- Rather than discounting from ‘regular prices’ price the Offer against what might be considered a substitute? If you say there isn’t one you are making my point!
- In terms of promotion, why tell people that the Offer is valued at $130? You are admitting that you are willing to provide all this amazing value and ‘eat’ the $41 discount. Communicate the price and leave it ‘naked’. If the Offer has compelling value to the intended customer the price will speak for itself. Get off the discount pricing kick!

Lets see…. adding value for the customer, making an incremental marketing investment to create this Offer and then taking it to market at a 32% discount. Doesn’t line up for me! Definitely a marketing Leaning point for White Spot marketers.

Holistic Offers are all about providing a package of synergistic value at a price that reflects that value. It is not discounted a la carte pricing!

Cheers, Roy Osing

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Posted 10.8.09 at 08:48 am by Roy Osing | Read Comments (1) | Leave a Comment