Another Ridiculous Fee
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Companies get to do whatever they want.?Buyers just decide whether or not to buy from them.??
I was sitting in Las Vegas, taking a course in a suite at the MGM Grand, when I saw this sign.?It struck me as ridiculous.??
I travel a lot, and most hotel rooms nowadays have mini refrigerators in them, at least the ones I frequent.?So why would the MGM put this fee in place??Answer:?because?they can.?
Sure, it takes time for someone to go through and count what’s in the mini bar after a guest leaves.?They want to save that expense.?Also, they may be able to earn an extra $35/day by renting a refrigerator.?This may be especially important considering some people may choose to eat food bought at a grocery instead of dining at the overpriced restaurants in the resort.??
In a way, this is smart pricing.?They bring you in with affordable prices and then sell you more when you’re only making Will I decisions.?Yet this one feels like it goes too far.?There is already a refrigerator in the room, but you can’t use it.?It’s only there for MGM to store items you may be able to buy.??
What do you think??Too much??Or smart pricing???
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Now, go make an impact.?
Working at the final level with post-MBA methods to optimise organisational decision-making and managerial efficiency advancing corporate marketing governance, strategy, and planning results.
2 年MGM executives need a lesson in the marketing concept, market segmentation and Total Product... This is the perfect example of operational lunacy without strategic purpose I have heard of in a while... albeit they happen all too often when senior decision-makers lack strategic intelligence.
It is a turn off for sure. Before saying if it is a good or bad decision, I would be curious the impact on incremental revenue. Is the emotional reaction of guests worth the extra revenue? I thought airlines charging for luggage, better seats, even carry-ons was a turn off….but I saw how much revenue this generated (literally at no extra cost)…and the fact all airlines followed suit…and I understood.
Operation Research Analyst, HQ AFMC/A9A at United States Air Force, Wright-Patterson AFB
2 年Mark definitely this is a ridiculous fee. But I guess that it might become a norm for others to copy down the road like the checked baggage fee charge by all the airlines here in the USA (barring Southwest). Yes, initially there will be lot of complaining, but soon it would be forgotten and it will become normal/natural. Definitely, customers have a choice to avoid these fees (if known at the time of the booking) like bringing a cooler, and not even opening the mini-bar (to avoid the temptation to use). I think ridiculous fees are treated as innovation by some organizations to improve their bottom line. The important question is can these fees be avoided?
Certified Instructor, Pragmatic Institute
2 年Wow. Just because you can doesn’t always mean you should…
Data Science and Analytics professional for the Performing Arts and Retail Industries
2 年Interesting. A few years back we were working on demand modeling for MGM and found that almost everything was extremely inelastic - even bottles of water. We thought our models must be broken. Nope. It seems people will way overpay even for water to avoid having to leave a casino. Until they won’t. MGM charging for fridge space is strong evidence that there are limits to overcharging for convenience.