Pricing on Purpose
Creating and Capturing Values
Chapter One
Why Is Movie Theater Popcorn
So Expensive?
... [M]en are fond of paradoxes, and of appearing to understand what
surpasses the comprehension of ordinary people ...
-Adam Smith [1723-1790]
Why don't we observe movie popcorn price wars, similar to what other
industries engage in from time to time? When asked this question, the overwhelming
majority of businesspeople will answer, because there is no
competition-the movie theater has a captive audience. Other common
explanations include:
Limited selling time
High fixed cost of operating concession stand
It is how the theater owner makes a profit
Higher clean-up costs imposed by snack eaters
Tastes and smells better than you can make at home
Part of the experience of seeing a movie
Because people will pay for it
At first glance, all of these ... read full excerpt from Pricing on Purpose: Creating and Capturing Value ebook
