Datamine helps SkyCity determine best ticket prices

When every dollar counts, price sensitivity for businesses is under the spotlight — How many customers could you lose if you valued your product at a higher price, and would that mean less or more total profit? And could you reduce your price and increase your earnings?

New Zealand company Datamine is helping businesses discover their best strategy for dealing with just such pricing decisions with success, most recently with SkyCity Cinemas, soon to be Event Cinemas.

“Pricing policy needs more than just guesswork. We see a lot of companies discounting where a higher price would be acceptable to their customer,” says Sally Carey, Datamine’s co-owner.

SkyCity hired Datamine to gauge customer perception of ticket prices and analyse how many tickets it would sell at various price points.

By translating the company’s existing data, Datamine clearly showed how high SKYCITY could price tickets without losing sales.

“In effect, we can run sales figures through various scenarios to concretely show larger retailers, which face the biggest cost, how the much discounting is too much and how their competitors deep discounting will affect them. We mock-up and test their options to find the best course of action,” explains Carey.

Datamine is also working with leading retailers to test the effectiveness of their marketing mix – saving them more money. What worked for them in a usual business climate may need changing to fit with the times.

“Ultimately it is every retailer’s aim to get their prices right. Answers to questions around pricing and how much your customer will pay are there within your data,” explains Carey, “you just have to ask the right questions.”