Segmentation of theatre audiences: A latent class approach for combined data

Alina Ozhegova and Evgeniy M. Ozhegov

Journal of choice modelling, 2020, vol. 37, issue C

Abstract: Theatrical productions are supposed to be perishable good, since the tickets for a particular play cannot be inventoried and sold after a time of play. In the revenue management of a perishable good price discrimination is widely used. Since the theatre audience is heterogeneous in terms of visit purpose, ability to perceive quality, willingness-to-pay, the strategy of price discrimination is developed in the context of theatre segments. In this paper, we segment consumers of Perm Opera and Ballet Theatre and propose marketing and pricing instruments to manage theatre revenue. Since development of detailed price discrimination strategy requires data on consumer's purchase history, her behavioural and socio-demographic characteristics, we collect and combine two data sources: data on ticket purchases and data obtained from discrete choice experiment. We modify latent class logit model for joint revealed and stated preferences data where data on consumer characteristics is only partially observed and employ the model to segment the audience. We identify four segments of the theater's audience. The study reveals theatregoers segments with different willingness-to-pay for performance and seat location characteristics. Segmenting allows to develop detailed recommendations on the pricing strategy for various theater audiences.

Keywords: Demand; Performing arts; Consumer segments; Willingness-to-pay; Discrete choice models (search for similar items in EconPapers)
JEL-codes: D12 Z11 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eejocm:v:37:y:2020:i:c:s175553452030035x

DOI: 10.1016/j.jocm.2020.100237

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