Menu/Pricing Makeover Q?

[wood]

So, about 1 year ago, I revised my wash menu. At that time I added a wash & towel dry for $4.95. I am an exterior with towel dry who used to have a base price of $6.50.
The volume has increased 20%, and I am pleased with that. However, for an array of reasons I want to go from 4 to 3 packages, and my main goal is to increase my revenue per car.

Presently I am $4.95 (35% of sales), $6.95(22%), $8.95(16%), $10.95(25%)

I plan on consolidating my $6.95 & $8.95. Is it best to switch that middle package now to $7.95 or leave $8.95? I purchased a couple new wax arch applications and will be able to maneuver, justify either way I go $7.95 or $8.95.

My question is: Which route should I go to achieve the increased revenue per car?

Thanks,
Wood

 

[rph9168]

I would raise the bottom package to 5.95 and make the middle 8.95.

 

[robert roman]

“I want to go from 4 to 3 packages, and my main goal is to increase my revenue per car.”

Where would you like it to be?

One common trick to achieve higher average sales is to combine good-better-best pricing with decoy marketing; offer customers a similar but inferior product at about the same price.

Basically, good is what people came for and better is used as a stepping stone to best. If customers don’t buy more of the less attractive wash, you may actually see a jump in sales of what you are trying to sell, best.

According to your numbers, current average sale is just shy of $7.50. Since this is the industry norm for express exterior, I would say that decoy marketing did not work particularly well for you - volume went up by 20 percent but I have to assume that average ticket must have dropped from the previous period when base price was $6.50.

One way to get back to a three package menu would be to drop the “good-better-best” product strategy. One problems with this strategy is its hard for people to see what the differences are and why they should want to pay a premium price.

A counterintuitive idea is top package marketing. Instead of adding a slightly inferior wash to the bottom of the menu, you would add a superior wash to the top. I find this strategy can lift average sale by $1.50 or so as compared to good-better-best. Unfortunately, it takes you back to a four package menu.

A sensible alternative to these strategies is to sell carwash services on a benefits platform. I find this strategy can lift the average by $2.50 to $3.00 or more as compared to good-better-best and it can be done with a three package menu.

 

[wood]

RPH:

A year ago I lowered my base by $1.55 (6.50 to 4.95). In my opinion, it is to soon to raise it back up. The 20% increase has been growing lately, and probably closer to 25% over the last 3 months.

I had 3 conveyor competitors in my market, One closed 4 months ago. So, I feel I am gaining momentum.

Robert:

When you factor in Tire Shine sales, which is a la carte my ticket average is $7.95. So yeah your $7.50 excluding tire shine is spot on.
For the same reason above, I want to keep my year old $4.95 as my base wash price. I am trying to consolidate my wash #2 ($6.95) & #3($8.95) and am trying to get a good portion of the #2 wash purchaser's to go up, not down. I'm not sure the best approach.
In addition, maybe if I did raise the top package from $10.95 to $11.95 i could offer those people tire shine for $1. presently it's $2.50 for all.

Can you explain the "benefits platform" a bit more?
I do appreciate your thoughts.

Wood

 

[wood]

Let me also add that I am ordering a couple of the overhead, waterfall type of new wax applications that were all over the show floor in Vegas. With the success I have heard of in the field and the benefits of the product to the finish I feel I can market, and package these accordingly, and justify whatever I end up doing.
I plan to place one at the entrance for the show and hopes of people seeing and then requesting, and one will be placed in the traditional wax stage.

Wood

 

[robert roman]

Hot wax was sold at carwashes decades ago and bubbler arch is a way to create a new show for customers (ala, triple foam). Combining these two products (one old, one new) is an example of how manufacturers are using innovation as a way to extend the maturity phase of product lifecycle (theirs and their clients).

However, just selling customers more “stuff” at different price points is merely transacting. In other words, hot wax and bubblier doesn’t guarantee a better value proposition to customers because other waxes are available. By comparison, total body protection and tire shiner were game changers because these products were previously unavailable to carwash customers in the wash-bay.

The "benefits platform" I mentioned is a departure from traditional carwash merchandising as the flex-serve operating platform is a departure from traditional full-service conveyor.

I don't give it away because the method has helped my clients make more money. Additionally, the platform requires more than add-ons and juggling prices. Implementation of specific tactics would only come after market analysis, customer surveys and preparing a marketing plan.