Want More Fans to Pay? Then Double the Price…
This is the part where you burn your Econ 101 textbook. Because in certain situations, fans will actually buy more if the price is higher. In the car business, this has been a lesson for brands like Cadillac, where experiments in lower-priced models destroyed the perception of higher-end quality. Once the prices were lifted again, status-conscious buyers returned.
But this anomaly goes beyond luxury automobiles. In the music space, Stageit founder Evan Lowenstein (formerly of Evan & Jaron) is pursuing the idea that artists should protect and charge for certain online assets, specifically unique, live streaming performances. But in a recent marketing analysis with Harvard Business School, surveyed fans actually showed a greater interest in certain higher-priced performances from their favorite artists – even though the ‘product’ itself remained unchanged.
Dip into ‘live streaming performances,’ and all sorts of variations emerge. That includes studio feeds, couch performances with requests, and full-blown concert simulcasts, all of which are getting studied and observed in the real world by Lowenstein. But most show a modest increase in demand even while the price is rising.
So, give away those easily-duplicated MP3s, but don’t dare give away those one-time special performances. And, price-point experimentation could produce some unexpected gains. The rest is still getting tested in the real world, though Lowenstein is broadening the petri dish through recent partnerships involving Jimmy Buffett and Rhino.