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The Magic Cafe Forum Index » » Tricky business » » Time to lower prices? (0 Likes) Printer Friendly Version

NJJ
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I am in a new area and have gone from 80% booking rate where I was well known to 30% booking rate in my area with my existing fee of $250 for children's parties.

I am by no means starving or even struggling but I can not help but wonder whether I should drop my price to $220 until my name gets around? (call it an Introductory Price)

Or should I market to more exclusive areas with rich families?
AragorntheMagician
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Metro-Atlanta
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Some questions you should ask 1st.

1) What is the going local rate (Top, Bottom & Midrange) for what you do and where do you fit in at your desired price point?
2) What are the local offering's & by who for those prices?
3) What % of the local entertainment market are you (ie example: Where you came from were there 10 competing so you would have been 10% of the local available talent & now where you are there are 20 competing so you are now 5% of the local available talent)? Where I am there are now 30 magician's in the local yellow pages (thank you downsizing) of which 12 - 15 make it a full time job. That means I am 3.33% which is not that good. However, Atlanta is such a large market with great demographics (and that's what this whole writing is about, demographics) that we are able to make a very good living.
4) What is the average income of population where you are and where you were?
5) What is population (avail on town/area's web site) of your target customer's
(ie - 100,000 3-7 year old's or 25 Major Companies that have really, really big company picnics every year)?
6) How many marketing oppertunities in area? (Resturant's are still great exposure)
7) What makes you stand out over your competition AT YOUR PRICE Point?

Number 7 is the main one and all the other questions lead to it. There have been many discussions on whether you need to be the most expensive or cheapest in a given market. The Clown & I found a way to be at the mid-point and have a 90% booking ratio. At your given desired price point with only 30% booking you normally either lower your price or you might try increasing your offering at that price. Whatever you do it will be the "Invisible Hand of the Market" that sets the price. In a discussion with another established performer he lamented, "All those amature's doing shows at $125". "Remember", I stated, "The market is always driven by the Hungriest Individaul!". A very true statement.

I plan on moving in about 2 years and am already researching my target. I am also saving up to do about 4 months of massive "PreMove Advertising" in that target market including the cost of a billboard on the main artery saying something like 4 months ahead, "Aragorn's Coming!!" "June 2008".......lol. We just had a major player come into our market and he hit the ground running. He knew who, what & where before he got here. Something to see...and emulate as needed.
Hope this helps,
Aragorn is Coming in 2008, Are YOU Ready?
aka: I used to be BOB (It's Cellini's fault)
"All Right, Who's Volunteering to be Turned into a Frog???"
www.aragornthemagician.com
James Munton
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Dallas, TX
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Nicholas,

I've always found that offering three different packages is the best way to test price.

If people consistently book the most expensive package, it's time to raise prices.

If people consistently book the cheapest package, you might want to work on your phone skills or perhaps test a slightly lower price for a while.

If you have recently moved to an area, you are going to expect the first couple of months to be a bit slower until the word-of-mouth starts working.

Word of mouth is the key. You want everyone who sees you at the party to start spreading the word. You can be obvious if you like and tell them to do it!

You might also try having an email sign up sheet at each party for all the other moms who stay to watch.

I personally wouldn't want to compete with the established market on price. As Aragorn said, I'd rather come in and offer something different.

If you do decide to lower your fee, you should make callers aware that they are getting a discount. Be upfront and explain why... "My normal fee in Oldsville was $250, but I'm so excited about moving to Newsville, I'm offering a special introductory price until everyone gets to know me here. For shows booked before the end of the month, I'm offering a $30 discount. Then it's back to $250 in February."

This isn't what I would personally do, but if you're going to reduce the price, definitely let them know they are getting a bargain.

Good luck!
James
Bob Sanders
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Magic Valley Ranch, Clanton, Alabama
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Since I'm an old marketing professor, my preference is to skim the market. The rest of the world calls it "cherry picking". The top prospects actually seem to not only pay better but also they have their acts together too. Things they touch simply work!

There has to be a sufficient number of those in your target market for that to generate the revenues needed. Otherwise you are left with two choices: work a larger circle or offer alternative products.

I would almost rather work for free than lower my fees.

Bob Sanders
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icentertainment
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If your not stuggling for cash- I would say don't drop your prices.

set the scene for the $250 kids party entertainer at the beginning.
You cn always lower your price---but it is harder to raise them later
NJJ
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Thanks guys.

I think I already knew the answer...I just needed others to tell it to me.

Aragon - I have done all the pre marketing you mentioned and I have had 60 calls since January 1. It's more getting the PRICE accepted rather then me!
Bob Sanders
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Grammar Supervisor
Magic Valley Ranch, Clanton, Alabama
20514 Posts

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With it known, next time you will find that the good prospects simply budget for you!

Mean while, keep on keeping on!

Good Luck!

Bob Sanders
Magic By Sander
Bob Sanders

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icentertainment
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60 enquiries and not enough bookings suggest your sales is letting you down
James Munton
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Either that, or you are advertising in the wrong place and getting the wrong kind of callers.

Best,
James
Buster Balloon
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There have been several times when I have made major upgrades to my show, which came with price increases. With each of them, I have found that the introductory price has worked very well.

When I get to the price portion of my phone script, I tell them that $X is my normal price, but since I am breaking in my new improved show, featuring (insert new feature here)I am offering it at $x as an introductory price. I also let them know how long I am offering the special price, so that when they call to book again or when they refer a friend, they know to book soon or expect the higher price.

When my wife (then my fiance) moved to California from Colorado, we used the same strategy. She offered her shows at a discounted introductory rate for the first 9 months to get acclimated, and to build her reputation, and it worked out beautifully.

And of course, as Arragon pointed out, and as you probably already know, you need to be able to clearly explain to a potential client what makes you stand out. Too many performers do the same old "I make your event special blah blah blah." Everyone says that.

When potential clients ask why I am more expensive than others I can tell them that no one else does a show that features a straight jacket, a leaf blower, a six foot balloon, and what are guaranteed to be the most amazing balloon creations they have ever seen.

Good luck in the new market. Looking forward to hearing all about your huge success.
Buster Balloon
Creative Genius, Balloon Twisting Savant, & Pre-Sweetened Breakfast Cereal Connoisseur
http://BusterBalloon.com
NJJ
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David and James - Could be both! It is the same marketing pitch that worked well in my previous market so I'm not sure the pitch is letting me down. It is more likely that my marketing is attracting the wrong type of bookings.

I just remembered that I have not taken into account people who wanted to book me but who I could fit in, so my success rate might be a little higher.
Donald Dunphy
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Victoria, BC, Canada
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Hi Nick -

From the shows you ARE booking now, are you getting repeat business, referrals, spin-offs, etc.? Are the customers writing you testimonials? Are you getting tipped?

Those might be some indications of whether the customers who are hiring you in your new area, feel you are offering "good value" to them (their perception of cost vs. the quality of service you provide).

Remember to keep first things first. Don't worry too much about those who can't afford you, and making them happy... worry about those who do hire you, and making them happy.

- Donald
Donald Dunphy is a Victoria Magician, British Columbia, Canada.
NJJ
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Hi Donald! With three weeks in town my referrals etc are pretty low. 7/60 were people who saw me already and 5 of them booked at the price.
Bob Sanders
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Grammar Supervisor
Magic Valley Ranch, Clanton, Alabama
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Don't forget that being new to town is newsworthy! Use it.

Bob Sanders
Magic By Sander
Bob Sanders

Magic By Sander / The Amazed Wiz

AmazedWiz@Yahoo.com
NJJ
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Indeed! I'm doing the my second round of media releases this week.
Bob Sanders
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Grammar Supervisor
Magic Valley Ranch, Clanton, Alabama
20514 Posts

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Offer to attend Chamber of Commerce, Elks, PTA, church and other meeting with five minutes of introduction. Don't forget that Valentines is HERE! Use it!

Good Luck on your relocation.

Bob Sanders
Magic By Sander
Bob Sanders

Magic By Sander / The Amazed Wiz

AmazedWiz@Yahoo.com
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