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Hello Alaska,
I had the pleasure of getting an economy lesson this holiday season, when I learned about supply and demand first hand. The short story is that my family and I traveled to Florida for a New Year's/ birthday cruise. I made these reservations months ago, but when I began entering the data for our airline reservations on the cruiseline site, I realized that I had made the reservation to depart out of Anchorage for a day too late (not sure how that happened when I looked at the reservation 50 times over a two day period before I finally bought it). With 6 of us traveling, my challenge now was finding a flight in the busy holiday season to get us to Ft Lauderdale a day earlier. After several frantic calls to the airline and some investigative computer work, our only option was to take a similar flight the day earlier and upgrade to first class. The tab for this little endeavor, including 6x$150 change tickets fees - $4588. OUCH!!!
There are so many personal lessons here that I will be flogging myself for weeks to come. From a business standpoint, large companies have a clear advantage in maximizing the pricing-to-need ratios (also known as "gouge me if you can" philosophy). Airlines and hotels are absolute champions of making you pay as demand increases, often times changing pricing several times a week, or even daily. Additionally, although demand is definitely higher at certain times during the year and for special occasions, the above industries recognize that people will pay for last minute availability. They have to get when the getting is good and as far as my financial relationship to the airline is concerned, the getting was really good!! Unfortunately tourists are often times the victim of financial strategies that are specifically designed for business travelers, who rarely book trips more than 2 weeks out and for whom the cost of the flight and hotel are secondary to the need to be somewhere on a specific date. Frequent stay and flier programs provide little incentive for the occasional vacationer, but are perks that business travelers demand and companies are very willing to provide to retain their clients and with great results. Overall, airline travelers that attain the highest standard of frequent flier incentive programs, typically represent less than 10 percent of the traveling public, but more than 40% of airline revenue.
Too few small businesses work the supply and demand curve well, which is very understandable. Doing so requires constant maintenance and few of us have the time to implement a program that may, or may not produce additional income. All of us have a threshold at which we walk away from a purchase, rather than pay too much. Hotels, airlines and many other large corporations have a full-time person on staff that figures out what exactly that financial breaking point is, by analyzing the potential demand, as well as the rates of competing businesses. There are many, many factors into determining exact price points based on the things that we sell, or offer. While it absolutely pays for multi-million dollar companies to squeeze out an extra 2-5% from its customers over the course of year, the expense to do so for a small independent business is prohibitive most of the time. In the end, we tend to double our cost of goods sold to establish a retail price point, or add what we deem to be an acceptable percentage above the overhead to provide a service.
Appreciating the economic principles behind maximizing profits and charging a premium at exactly the right time that doesn't allow a consumer to walk away, doesn't make up for the gaping hole in my pocketbook. But no worries friends, I'll be back with a super saver fare next year that will undoubtedly make up for the beating I took last month.
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I feel the need to take a couple of lines to promote our own Alaska Aces and for some of you the opportunity to affiliate with this pro club. It helps if you're a hockey fan, but even if that isn't the case, reaching an average audience of 3000-4000 spectators every home game (more often 5000-6000 in late season playoff games) whose primary demographic is 25-54 year old women, this medium may be for you. There are many ways to get your business name associated with the boys in blue and white, beginning with simply buying group tickets. Not only is giving away those tickets to your best clients a great perk (see frequent traveler story above), but your company will be recognized during the game. Lindsey Whitt, the team's phenomenal business development manager can give you all the details, when you call her at 907.375.6816
Need more incentive, why not join the Alaska Aces on February 24th & 25th for a special "Ladies Night" event at the Sullivan Arena when they play the Las Vegas Wranglers!?!?
For this event the Aces are selling 6 ft tables in the expansion area of the Sullivan Arena complete with pipe, draping and one banner for a mere $750.
As a booth sponsor your purchase includes 25 group tickets for your company to use on either Thursday or Friday night in the Upper Mezzanine area (above the glass/orange seats) - your preference of WET or DRY seat.
The Alaska Aces will heavily promote the event for two home games, multiple event announcements throughout January and February on radio, TV, Facebook, printed programs, on-ice promotions, and in other businesses throughout Anchorage.
On a side-note, 2 years ago I happened to be in Las Vegas when the Aces played the Wranglers and I went to watch the game. I found the fans there to be uneducated and nasty. My friends will tell you that I am still scarred from the verbal abuse I took from a 12 year old boy that not only berated me the entire game with 4 -letter bombs, but followed me out the arena doors and continued to trash-talk me the entire walk down a veeeery long hallway back to the casino. Needless to say, I am NOT a fan of the Las Vegas franchise and would appreciate your help in welcoming them to Anchorage appropriately. Nothing serious please, but booing lustily is encouraged whole-heartedly!
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Summer tourism marketing campaigns are starting to pick up steam! The Kenai Peninsula Tourism Marketing Council has the following partnership opportunities available. - LA Times Travel & Adventure Show deadline 2/21/2011, show date 3/19-29/2011
- Mat-Su Outdoorsman Show deadline 3/7/2011, show date 3/25-27/2011
- Great Alaskan Sportsman Show (Anchorage) deadline 3/18/2011, show date 3/31-4/3/2011
- Fairbanks Outdoors Show deadline 4/4/2011, show date 4/15-17/2011
- Oxygen and Octane Winter Recreation Show deadline 9/19/2011, show date 10/8-10/2011
Click here to download the registration form, or contact the KPTMC for more information at info@kenaipeninsula.org, or (907) 262-5229 ATIA invites you to introduce your product to key travel agents, tour operators and media. The week will consist of training seminars for the Japanese travel trade, meetings with product planners and a media event in Tokyo. This invitation is limited to 10 partners. Tokyo - April 18-19, 2011 Nagoya - April 20 Osaka - April 21 Hiroshima - April 22 Cost: $2,500 Registration Deadline: February 4, 2011 Click for an application & more information ATIA can also distribute your brochures at their Alaska booth at ITB in Berlin. This is the world's largest travel show with over 111,000 trade professionals in attendance. Global and German tour operators and travel agents, as well as the international press, come to the Discover America Pavilion to find out what is new in the Alaska market. March 9-13, 2011 in Berlin, Germany Cost: $2,500 for both share, $250 for brochure distribution Registration Deadline: February 4, 2011 Materials Deadline: February 25, 2011 in Germany Click for an application & more information ------------- Why not start the new year by getting ahead of the game? Check out the wide variety of the workshops offered by the Alaska Small Business Development Centers and its partner programs around the state? They include:
Anchorage: Employer Payroll Tax Workshop - Jan 28 Business Bookkeeping - Beginners - Feb 9
Bethel: Tax Planning - Jan 14, 15 Payroll for Quickbooks - Jan 27
Fairbanks: Starting a Small Business - Jan 19
Homer Business Start Up -- Jan 21, Feb 7
Seward Business Start Up - Jan 14
Soldotna Feb 9
Wasilla Intro to Starting a Business - Jan 18, Feb 2, Feb 9 Basic Business Bookkeeping - Feb 1
To see them all visit: http://aksbdc.org/small-business-workshops/ ------------- The Alaska EXPO Foodservice & Hospitality Show Dena'ina Convention Center on February 4th 2011 This unparalleled commercial show, which is not open to the public is the largest restaurant, foodservice, hospitality & lodging industry trade show held in this state. Over 2,000 Companies will be invited to attend. Attendees represented: Chefs, General Managers, Purchasers, Marketing Managers, Restaurant Owners Associations, Bar, Nightclub, Bed & Breakfasts, Café, Coffeehouse, Teahouse, Catering, Consulting, Government Agencies, Grocery, Convenience Store, Hospital, Nursing Home, Clinics, Hotel, Motel, Inns, Non-Profit Organizations, Press, Media, Institutional Foodservice, Lodges, Resort, Golf Course, Restaurant - Fast Food, Restaurant - Full Service, Oil & Mining Camps and Schools & Universities New for 2011, The Alaska Expo will be hosting the 42nd Annual Alaska School Nutrition Association vendor show. The Alaska School Nutrition Association is the Alaska affiliate of the National School Nutrition Association, which represents more than 55,000 food industry professionals involved in school foodservice programs. Also new this year will be a New Buyers Guide mailing out to over 2,000 professionals in the industry. This is a resource that attendees will be able to use and reach out to exhibitors throughout 2011, when they're looking for products and equipment. For additional show details, visit the event website: www.alaskaexpo.biz ------------- Alaska SeaLife Center Marine Gala Fundraiser January 16th at the Dena'ina Center in Anchorage. The evening will showcase the work and stories of National Geographic Photographer Joel Sartore, the Alaska Ocean Leadership Awards, and both silent and live auctions. After the formal event, dance the night away with "H3," Anchorage's own award winning band. Be sure to visit, www.alaskasealife.org/alaskamarinegala, or call 907-224-6890 with any questions, or to purchase tickets, ------------- Alaska Top Forty Under 40 Awards - Now accepting nominations
Sponsored by the Alaska Journal of Commerce, the awards recognize the state's top young professionals younger than age 40 who have demonstrated professional excellence and a commitment to their community. Attached is a flyer that you can post to encourage nominations to this prestigious recognition program.
Criteria for Selection:
- Must be younger than age 40 on January 1, 2011
- Must live and work in Alaska year-round
- Must have demonstrated professional excellence in their field
- Must display a commitment to the community
Find nomination forms at http://www.alaskajournal.com.
Simply download the form, fill it out, and e-mail it as an attachment to editor@alaskajournal.com.
An event to honor those selected is set for March 2011.
For questions, contact: Melissa Campbell, Managing Editor of the Alaska Journal of Commerce - (907) 275-2158, or editor@alaskajournal.com
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