💵 Why dynamic pricing is the future
Hello! Adam Thornhill here. ‘The Podcast Guy’ saving you 10 hours a week.
Enjoy the 97th Podup, with special thanks to TikTok For Business.
Today, we’ll dive into the best insights and ideas from Invest Like The Best.
Ever had that “Why didn’t I think of that?” moment? Sometimes, it’s not about reinventing the wheel but borrowing the best bits from somewhere else.
Nick Kokanas gets it. He owns several high-end restaurants. Nick borrowed concepts from the entertainment industry to supercharge his business.
Know your true offering
Know what you're selling and then actually sell it. This sounds incredibly obvious, but most restaurants would answer this with 'I sell food.' Wrong. They sell entertainment. Eating out is a social endeavor.
Restaurants don't sell like every other form of entertainment. Look at baseball games, concerts, theatre. They all do some sort of ticketing. I was told that it was a terrible idea to do this for my restaurants.
When we started to bring in money through deposits and prepaid reservations tickets, I suddenly looked and had a bank account that had a couple of million dollars in it. It worked, and now we have a float.
Nick Kokanas
The era of variable pricing
Any business that's time slotted should be dynamically priced, right down to your lawyer or dentist. We all want a 10am Saturday appointment, so why doesn't it cost more to go to a dentist then?
The tools to do so aren't yet widely available. But if you look at Amazon and Shopify for hard goods, they're doing this already. It's less accepted for services but it's inevitably going to happen.
Nick Kokanas
Why it matters
By challenging conventional business norms and borrowing pricing strategies from adjacent industries, you can make a tangible difference to your bottom line.
We did exactly this at Medicspot. Historically, our doctor appointments were £49, despite seeing much higher demand in the morning and after work.
We tested a variable pricing model to assess its impact on profit and we were delighted with the results. I'd recommend anyone selling services to do the same.
Next steps
Reflect on what you sell. What is the outcome you're selling to customers? Why do they buy?
Explore new models. If restaurants can benefit from ticketing, what new models are available to your business?
Test dynamic pricing. As the world embraces on-demand services, consider testing variable pricing.
Customer engagement is key. Always keep your customer in the loop. Change is easier digested when it's expected.
Iterate and innovate. Pilot new strategies, gauge the response, tweak, and try again.
Your thoughts?
Thanks to TikTok For Business for making this post possible…
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Quotes were pulled at different points of the episode. Sentences were left out to make the narrative more concise. Podup is not associated or affiliated with any podcast.