“I'd like to move the bottom....people up. .... (what)....moves them?”
Customers can be “moved” if you solve their problems.
Sales mix provided equals average of $8.15, typical for express tunnel. Benchmark for top package
marketing is $9.00.
Simple test for price is compare per capita income in trade area with U.S. per capita, this gives measure of relative spending.
In your case of $8 average, if trade area per capita is less than U.S., prices may be too high.
If trade area per capita is greater than U.S., it may be possible to create upward pressure on price.
However, increasing price by manipulating price alone (scaling up) to increase total revenue (profit) is same as trying to increase volume by manipulating price alone (scaling down).
Works in theory but results vary significantly by circumstance.
Besides price,
marketing involves products (do they solve customer’s problems), promotion (is information/message reaching consumers) and distribution (do customers have sufficient access).
So, you should identify root cause before formulating a remedy (strategy).
For example, if you survey customers and find, say, only 5 percent of them are between the ages of 18 and 30 years old, this low level would have an adverse effect on volume as well as average price.
Low average can also be a sign customers do not appreciate what is being offered. Here, a satisfaction survey can be invaluable means to help determine customer attitudes and buying habits.
For example, currently, 63 percent of your average revenue comes from 75 percent of your customers (lowest prices).
Typical performance is 49 percent of average revenue would come from 36 percent of customers.
Above average performance would be 71 percent of average revenue comes from 61 percent of customers (highest prices).
Consequently, this leads me to suspect that price (alone) is not the problem.
Hope this helps.
