Revenue management in the context of movie theaters: Is it fair

Choongbeom Choi, Miyoung Jeong, Anna S. Mattila

Research output: Contribution to journalArticle

7 Citations (Scopus)

Abstract

Certain industry characteristics (for example, a relatively fixed capacity, varying and uncertain demand, and perishable inventories) are a prerequisite for a successful implementation of revenue management (RM) practices. Although movie theaters have these characteristics, they have failed to try RM as a pricing strategy. The current study examines the joint impact of five potential RM practices (that is, rate fences) and framing effects (surcharge versus discount) on consumers' price fairness perceptions. Several rate fences (morning-versus-noon, weekday-versus-weekend and time-of-booking-based pricing) received relatively high fairness ratings, whereas location-based and popularity-based pricing were perceived as less fair. In addition, framing ticket prices as a discount rather than a surcharge significantly improved customers' price fairness perceptions. The findings of this study provide guidance for movie theater operators in their pursuit of optimal pricing.

Original languageEnglish (US)
Pages (from-to)72-83
Number of pages12
JournalJournal of Revenue and Pricing Management
Volume14
Issue number2
DOIs
StatePublished - Mar 21 2015

Fingerprint

Revenue management
Movie theaters
Pricing
Fairness perceptions
Price fairness
Management practices
Discount
Uncertain demand
Pricing strategy
Optimal pricing
Operator
Industry characteristics
Guidance
Rating
Fairness
Framing effects
Consumer prices

All Science Journal Classification (ASJC) codes

  • Business and International Management
  • Finance
  • Economics and Econometrics
  • Strategy and Management

Cite this

@article{dd1b249fdf57446caaf6698fca368fd3,
title = "Revenue management in the context of movie theaters: Is it fair",
abstract = "Certain industry characteristics (for example, a relatively fixed capacity, varying and uncertain demand, and perishable inventories) are a prerequisite for a successful implementation of revenue management (RM) practices. Although movie theaters have these characteristics, they have failed to try RM as a pricing strategy. The current study examines the joint impact of five potential RM practices (that is, rate fences) and framing effects (surcharge versus discount) on consumers' price fairness perceptions. Several rate fences (morning-versus-noon, weekday-versus-weekend and time-of-booking-based pricing) received relatively high fairness ratings, whereas location-based and popularity-based pricing were perceived as less fair. In addition, framing ticket prices as a discount rather than a surcharge significantly improved customers' price fairness perceptions. The findings of this study provide guidance for movie theater operators in their pursuit of optimal pricing.",
author = "Choongbeom Choi and Miyoung Jeong and Mattila, {Anna S.}",
year = "2015",
month = "3",
day = "21",
doi = "10.1057/rpm.2014.30",
language = "English (US)",
volume = "14",
pages = "72--83",
journal = "Journal of Revenue and Pricing Management",
issn = "1476-6930",
publisher = "Palgrave Macmillan Ltd.",
number = "2",

}

Revenue management in the context of movie theaters : Is it fair. / Choi, Choongbeom; Jeong, Miyoung; Mattila, Anna S.

In: Journal of Revenue and Pricing Management, Vol. 14, No. 2, 21.03.2015, p. 72-83.

Research output: Contribution to journalArticle

TY - JOUR

T1 - Revenue management in the context of movie theaters

T2 - Is it fair

AU - Choi, Choongbeom

AU - Jeong, Miyoung

AU - Mattila, Anna S.

PY - 2015/3/21

Y1 - 2015/3/21

N2 - Certain industry characteristics (for example, a relatively fixed capacity, varying and uncertain demand, and perishable inventories) are a prerequisite for a successful implementation of revenue management (RM) practices. Although movie theaters have these characteristics, they have failed to try RM as a pricing strategy. The current study examines the joint impact of five potential RM practices (that is, rate fences) and framing effects (surcharge versus discount) on consumers' price fairness perceptions. Several rate fences (morning-versus-noon, weekday-versus-weekend and time-of-booking-based pricing) received relatively high fairness ratings, whereas location-based and popularity-based pricing were perceived as less fair. In addition, framing ticket prices as a discount rather than a surcharge significantly improved customers' price fairness perceptions. The findings of this study provide guidance for movie theater operators in their pursuit of optimal pricing.

AB - Certain industry characteristics (for example, a relatively fixed capacity, varying and uncertain demand, and perishable inventories) are a prerequisite for a successful implementation of revenue management (RM) practices. Although movie theaters have these characteristics, they have failed to try RM as a pricing strategy. The current study examines the joint impact of five potential RM practices (that is, rate fences) and framing effects (surcharge versus discount) on consumers' price fairness perceptions. Several rate fences (morning-versus-noon, weekday-versus-weekend and time-of-booking-based pricing) received relatively high fairness ratings, whereas location-based and popularity-based pricing were perceived as less fair. In addition, framing ticket prices as a discount rather than a surcharge significantly improved customers' price fairness perceptions. The findings of this study provide guidance for movie theater operators in their pursuit of optimal pricing.

UR - http://www.scopus.com/inward/record.url?scp=84928153725&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=84928153725&partnerID=8YFLogxK

U2 - 10.1057/rpm.2014.30

DO - 10.1057/rpm.2014.30

M3 - Article

AN - SCOPUS:84928153725

VL - 14

SP - 72

EP - 83

JO - Journal of Revenue and Pricing Management

JF - Journal of Revenue and Pricing Management

SN - 1476-6930

IS - 2

ER -