This is one for all you pricing purists – a true story where the names have been changed to protect the guilty… There are two publications fighting it out for the hearts and minds of the travel industry. One is clearly the market leader, packed with advertising every day, while the other is a long way number two with 75% less advertising. The market has clearly stated that it only sees value in the market leader under the present rate structure yet there’s been no adjustment from #2 even even though the imbalance is getting worse.
A potential advertiser recently approached #2 with a low-ball, long-term offer for a slot that had seen nothing but house ads for weeks figuring something is better than nothing. He was told: “The rates for positions are not determined by whether they’ve been sold or not but the value that those positions have.” Right. Genius at work. Slot still vacant. And people say discounting is a bad thing. Discuss.