“Price is what you pay, value is what you get.”
What an insightful comment! No doubt the fact that it comes from the world’s most renowned investor, Warren Buffet, adds to the credibility of the statement.
I’ve personally noticed that there is a tendency for businesses to focus too much on the price of a product or service rather than adequately assessing the value.
It is crucially important for venue managers, in fact everyone in hospitality, to understand value.
If promotions and events (as well as all products and services you pay for) are seen purely in terms of cost then the potential for increased patronage and spend is minimised.
I’ll use an example of a venue we have dealt with on and off for the past fifteen years or so.
The manager of this venue sees promotion purely as a cost, rather than an investment. The whole thing, in his eyes, begins and ends with the invoice we provide him for our weekly trivia event.
Eighteen months ago, after hosting our trivia event at his venue for a number of years, this particular venue manager decided he wanted out. He looked at his budget and was convinced he couldn’t justify the weekly cost of the event. Fair enough, these things happen. We shook hands and went our separate ways.
The loyal trivia players were disappointed with this venues decision. The weekly event had become their regular night out with friends where they could get together for a meal and a few drinks to enjoy the quiz and a few laughs.
We ended up teaming with another venue nearby and a few of the players were happy to make this their new local.
Fast forward a few months and the original venue manager called us.
There was a big bar and bistro deficit showing up for his Wednesday night trading, the same night he had been hosting trivia.
Plus, he had noticed what had been a lively, atmosphere filled night was now a dull affair without the vitality and excitement that his forty regular trivia players had added to the venue each week.
I’m not trying to boast. This could have been any type of promotional event, delivered by any provider. The point is this guy saw only the cost and not the value that his weekly event provided in bar and bistro sales and boosted atmosphere.
Understanding the value of promotions and your other investments in products and services is crucial in running a successful venue.