Customer outrage about expensive ticket prices is not a new phenomenon. But recently, even politicians are joining the chorus of complaints and threatening to investigate the entertainment ticket industry. But are Ticketmaster, Live Nation, and other providers gauging prices? Or are the prices driven by other factors?
Some fans were outraged when man-of-the-people Bruce Springsteen charged more than $5,000 per seat for his upcoming concert. The high prices were the result of a dynamic pricing system, in which prices are adjusted upward in response to strong demand. This controversy illustrates seven lessons that managers should keep in mind when adjusting prices, including the need for clear communications, longtime customers’ expectation that they deserve a discount, and the fact that high prices will raise expectations about quality and service.