September 11, 2012

CRM Oh Oh

My boss at Nordstrom used to say "CRM is a four letter word".  

It does make you think.

Take the University of Maryland.  They're having problems getting customers to purchase season tickets to college football games (click here).

So you have 15,000 folks who pony up the money for every game.

And then the athletic department works with Living Social to offer discounted tickets ... at $15 each.

Now, the article doesn't suggest that season ticket holders pay full price for every game, so we can't assume that best customers are being ripped off.

But the strategy does raise a few questions for CRM experts:
  1. Why is it considered a best practice to offer Living Social customers $15 tickets while the general public might be asked to pay $30 or $40 for the same ticket?
  2. If you were the marketer who executed this campaign, how would you respond to the customer who purchased a comparable individual game ticket for $40 two weeks before the promotion was offered?  Imagine that customer, standing in front of you, asking why s/he had to pay more ... how would you answer that person, in person?
  3. Do you think that a partnership with Living Social will yield customers who attend a game, are thoroughly enthralled, and become season ticket holders?
Discuss.

2 comments:

  1. Anonymous10:43 AM

    Groupon and Living Social are a great way to swap marketing cost for high sales cost. Yep, you only pay on the sales but at $15 per ticket how much are University of Maryland getting after the comissions have been paid? A very small amount.

    As a marketeer, to me, Groupon and Living Social are the marketing method of the desperate. They encourage trial but are you getting trial from a demographic that is likely to repurchase or from the bottom-feeders?

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  2. Perishable goods such as game or airline tickets, or hotel rooms, etc. are worth exactly zero after a certain point in time. And those who purchase earlier get the better seats and the certainty of having a ticket/reservation. So it's perfectly rational to offer remainder inventory at the last minute at deep discounts.

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