A Super Sunday

Looking for something to do this weekend?  Market Watch reports that prime tickets for this Sunday’s Super Bowl are going for as much as $50,000.00.  Of course, you’re not just going to see a football game.  The price includes performances by Alicia Keys, Jordin Sparks, Paula Abdul, and Tom Petty and the Heartbreakers.

Of course, 50 grand doesn’t include getting to Phoenix, hotel accommodations or other expenses.  For example, two nights at the Hampton Inn in Glendale, AZ will set you back $449.10 per night, according to Expedia.com.  Come back next weekend and the same room will cost you $134.10.

Need a car?  An economy model from Hertz this weekend is going for $67.99 per day.  Next weekend?  $38.99.  Opportunistic pricing?  No, supply and demand.  If we’re in the widget business and we don’t sell all our widgets today, we can always sell more tomorrow.  But Super Sunday only comes once each year.  Even at 1/3 the price, that Hampton Inn probably won’t be full next weekend.

Want another example?  30 second commercials during the game are going for a mere $2.7 million.  That may seem like an outrageous amount of money, but consider the brands who come back year after year, many for multiple spots.  It must be worth it.

Here’s the thing.  Whether it’s a football ticket, a hotel room, a rental car, or a vacuum cleaner, people spend their money to get value.  If there’s somebody out there willing to pay $50,000 for two tickets to a football game, then it’s a fair price. It’s all in the customer’s perception of value.  If they think your product is worth more than their money, you’ve got a sale. The selling price has nothing to do with the seller’s cost.

In retail it’s called "value pricing" and it’s the best way to beat your competition.  Cost plus may work for
Sam’s and Costco, but the rest of us have to be a little more creative.  How well does it work?  The National Hockey League has one game scheduled for Sunday and it’s in Canada.  The NBA has two games, both Sunday afternoon.  How great would it be to have your biggest event of the year and have your competitors not even try to compete?

Most of us will never know.

Super_bowl

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