February 8-10, Hilton Dallas / Rockwall Lakefront

Transcription

1 February 8-10, 2015 Hilton Dallas / Rockwall Lakefront

2 IAAPA FEC Pricing Presentation Feb

3 Table of Contents Opening Comments Review a few Pricing Research Charts Discuss FEC Segmentation and Revenue Drivers Present Pricing Logics/Theory Philosophic Gut Check Review Rationale for Price variation or similarity Give Examples of FEC pricing configurations Open discussion 3

4 Pricing Research + $40 While price does influence volume Season Pass Sales by Pass Price Change in Season Pass Price From Current Level + $30 + $20 + $10 Now - $10 - $20 - $30 PKI PKD PGA PC PCW - $40-75% -55% -35% -15% +5% +25% +45% +65% % Change in Season Pass Sales

5 Pricing Research A strategic balance of price/volume will Maximize Revenue + $40 Season Pass Indexed Revenue Variance by Price Variance (w/resale) + $30 + $20 PKI PKD PGA PC PCW Change in Season Pass Price + $10 Now - $10 - $20 - $30 - $40-25% -20% -15% -10% -5% +0% +5% +10% +15% +20% +25% Impact on Season Pass Holder Net Revenue

6 Pricing Research Guests generally do not know the price of a visit or how much they paid last time 20% $43 15% Percent of Respondents 10% 5% 0% $5 $10 $15 $20 $25 $30 $35 $40 $45 $50 $55 $60

7 Pricing Research Strategic promotions can optimize revenue but it is all about awareness % Change In Overall Consumer Demand Attendance / Net Revenue 160% 140% 120% 100% 80% 60% 40% 20% Overall Average Impact of Promotions on Consumer Demand Attendance & Net Revenue at 100% Awareness 51% 70% 72% 81% 66% 97% 67% 116% 48% 138% 58% 140% 50% 110% 41% Attendance Net Revenue 83% 11% 37% 0% Free Parking Free Lunch Buy 3 Get 1 Buy 2 Get 1 Buy 1 Get 1 $20 Off $15 Off $10 Off $5 Off Assumes 100% awareness of base price and 100% awareness of the discount. Resale per cap assumptions are described on the last page.

8 Strategic Pricing Model Revenue is/needs to be looked at segmentally Total Park Revenue

9 Corporate Sales Strategic Pricing Model Corporate Sales is Incremental Revenue (new revenue stream) New Revenue Source Budget Price Sensitive FEC Transient Revenue

10 Corporate Sales Strategic Pricing Model Birthdays Parties are important generator of trial business New Revenue Source Budget Price Sensitive FEC Transient Revenue Birthday Party Sales Brings in Trial Uses Opportunity for Upselling

11 Corporate Sales Strategic Pricing Model While Groups/Birthdays are important - Transient is majority of revenue FEC Transient Revenue Birthday Party Sales

12 IAAPA FEC Report - Nuggets FEC Benchmark Study shows similar industry grouping Attendance Breakdown (US/Canada page 27) General (58%) + Discount Admission (9%) 67% Corporate (7%) + Group(10%) 17% Birthday Parties 21% Season Pass 3% Other (15%) + Comp(3%) 18% 12

13 Objectives of the Successful Pricing Structure Maximize Revenue Reward Favorable Customer Behavior Manage Migration Simplify Pricing Structure

14 Pricing Considerations Pricing is more of an art than a science based on insightful experience. Our research says Pricing is too complicated do not know what to buy Believe price is too high Foundations of a good pricing strategy When driving traffic - what are the difference role between product and price? Do people shop for the best deal? Is the program delivering New vs. Old revenue? Pricing structure should promote desired Consumer Behavior Buy more (volume discount) Buy early vs. day of (in advance guaranteeing sale competitive advantage) Visit off-peak vs. peak 14

15 Demand drives attendance not price Consideration for Pricing Strategies Are the identifiable reasons to price product differently? People shop for the best available offer after they decide to visit Migration - Need to manage between programs Treat new revenue streams different than existing revenues Promotions can effectively drive traffic and revenue if fenced Price is generally inelastic around the price point, an increase in price will not reduce volume commensurately The goal is Revenue Maximization

16 Strategic Rationale for Discounting There are identifiable reasons for promotional discounting Sales Volume Group and Birthday Sales Traditionally Works against all programs Active in game/arcade area Generates Commitment Pre-sold Sales (Web or Third Party) Acts as insurance Offsets competitive pressure Creates Urgency Drives key day/period traffic Capacity management (generally not a problem) Adds Awareness Media trades Benefit from Association Very limited opportunity

17 Rationale for Price Variation There are identifiable reasons to price product differently between markets Market Economic conditions (disposable income) Brand Demographics Limited Number of Attractions Capacity Issues Technology Park Condition 17

18 Pricing Structures There are price offerings that if manages together can maximize revenue and simplify the structure A la carte pricing (Buy One) Packages (volume based Buy Bunches) Time Based pricing (But Block of Time) Bundling (add food, etc.) Birthday Pricing Group Sales 18

19 IAAPA FEC Report - Nuggets FEC Benchmark Study shows vast variability related to pricing matters Pricing Structure (US/Canada page 25) Pay as you go 10% Pay one price 34% Combo 55% Arcade Systems Usage (US/Canada page 58) Cash/Coin 41% Tokens 50% Card Systems 43% Wristband 5% 19

20 A few examples of FEC Pricing Maximize Revenue Reward Favorable Customer Behavior Manage Migration Simplify Pricing Structure

21 Package Pricing Pricing: a la carte, volume, time play, and bundling Attractions Mini Golf 1 Round $8.00 At Boondocks Food & Fun, there's something for everyone of all ages to enjoy! Bumper Boats 1 Driver (minimum of 44") 1 Passenger (minimum of 36") $7.50 $3.50 Unlimited Fun Unlimited Fun (58" and above) $28.95 Junior Unlimited Fun (under 58") $21.95 Go-Karts 1 Driver (minimum of 58" for Road Track and Slick Track, 48" for Rookie Track) 1 Passenger (minimum of 40") $7.50 $3.50 Includes: Bowling (includes shoe rental), Miniature Golf, Bumper Boats, Laser Tag, Go- Karts (Road Track, Slick Track, Rookie Track, Jr. Racer), Kiddie Cove and 10 arcade tokens for general admission, 20 arcade tokens for junior admission. Indoor Unlimited Indoor Unlimited - All Ages $17.95 Includes: Laser Tag, Bowling (includes shoe rental), Kiddie Cove and 20 Arcade Tokens Fun Packs Pick 2 - Includes 2 passes & 10 arcade tokens $15.95 Pick 3 - Includes 3 passes & 10 arcade tokens $20.95 Each Attraction pass good for choice of: Go-Kart Ride (Road Track, Slick Track, Rookie Track or Jr. Racers) Bumper Boat Ride Round of Miniature Golf Laser Tag Game Game of Bowling (includes shoe rental) Rookie Track 1 Driver (must be 48" tall) $7.50 Jr. Racers 1 Driver $3.50 Laser Tag 1 Game (minimum of 40") $7.50 Bowling Weekdays (Monday - Thursday and Friday before 4 pm) Per Player / Per Game Per Lane / Per Hour (Six Player Maximum) Prime Time (Friday 4 pm - close, Saturdays, Sundays & Holidays) Per Player / Per Game Per Lane / Per Hour (Six Player Maximum) Shoe Rental Rental Fee Socks Available For Purchase $4.00 $20.00 $4.50 $22.50 $3.00 $2.00 Kiddie Cove Unlimited Play (Under 48 ) $3.50 Arcade 1 Token 20 Tokens 43 Tokens (3 Free) 87 Tokens (7 Free) 25 $5.00 $10.00 $20.00

22 Pricing: a la carte, volume, time play, and no obvious bundling Main Street Transfer Individual Ride Tickets $ tax per wristband 6 Tickets - $8.00 +tax 12 Tickets - $ tax This wristband includes: 24 Tickets - $ tax UNLIMITED Basic Park Rides UNLIMITED Playzone with Inflatables Main Street Deal $ tax per wristband This wristband includes: UNLIMITED Basic Park Rides UNLIMITED Playzone with Inflatables TWO (2) Special Attraction tickets Keys to the City $ tax per wristband This wristband includes: UNLIMITED Basic Park Rides UNLIMITED Playzone with Inflatables UNLIMITED Special Attractions 48 Tickets - $ tax Train - 3 tickets to ride Carousel - 2 tickets to ride Truckin' U.S.A. - 2 tickets to ride Taxi Jet - 2 tickets to ride Jitterbug Swinger - 3 tickets to ride Tilt-A-Whirl - 3 tickets to ride Miner Mike Kid's Coaster - 2 tickets to ride Frog Hopper - 2 tickets to ride Mini Himalayan - 3 tickets to ride Santa Ana Scrambler - 3 tickets to ride Ferris Wheel - 3 tickets to ride Antique Cars - 3 tickets to ride Tubs of Fun - 2 tickets to ride Super Bee - 2 tickets to ride Balloon Race Ride - 3 ticket to ride Sam's Fun City has many great attractions that are suited for adults, teens, kids and families of all ages. On slower Sam s Fun City Quick Facts: Free General Admission Over 20 rides and attractions Great food at Bullwinkle's Restaurant Go-Kart tracks for all ages Crossroads arcade Convenient location

23 Examples of FEC Pricing Seven Peaks FEC Pricing: a la carte, volume, time play, and bundling 23

24 Examples of FEC Pricing Boomers Irvine Pricing: What are a la these carte, pricing volume, structure time play, trying and to convey? bundling 24

25 Pricing Considerations Questions to stimulate dialog How many locations are considering using debit cards? Does anyone have demand pricing (price differently weekday/weekend)? How prevalent is Time Play? Do you allow card credits/points to be used on games and attractions? Can a guest buy food/merchandise with card credit? Can redemption points be used to buy food/merchandise? Should all attractions be the same price? What does your loyalty program look like? 25

26 Open the Floor for Questions and Comments

27 Open Discussion Speak now Set Strategic Direction by Consensus (together) Test park (Houston/EC.SD) vs. full rollout Next steps digest and make recommendations for a Feb 1 st decision Implement by March 1 st (or sooner ) IAAPA FEC Pricing Presentation Feb 2015

28 February 8-10, 2015 Hilton Dallas / Rockwall Lakefront