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Segmentation of Theatre Audiences: A Latent Class Approach for Combined Data

Author

Listed:
  • Evgeniy M. Ozhegov

    () (National Research University Higher School of Economics)

  • Alina Ozhegova

    () (National Research University Higher School of Economics)

Abstract

Theatrical productions are perishable goods, since the tickets for a particular play cannot be inventoried and sold after the time of the 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 should be developed in the context of theatre segments. In this paper, we segment consumers of the Perm Opera and Ballet Theatre and propose marketing instruments to increase theatre revenue. Since the development of a detailed price discrimination strategy requires data on consumer purchase history, behavioral and socio-demographic characteristics, we combine two data sources: data on ticket purchases and survey data. Using a modication of a latent class logit model for joint revealed and stated preference data we identify four segments of the theater's audience. The study reveals theatregoer segments with dierent willingness-to-pay for performance and seat location characteristics, which allows the development of detailed recommendations on the pricing strategy for various theatre audiences

Suggested Citation

  • Evgeniy M. Ozhegov & Alina Ozhegova, 2018. "Segmentation of Theatre Audiences: A Latent Class Approach for Combined Data," HSE Working papers WP BRP 198/EC/2018, National Research University Higher School of Economics.
  • Handle: RePEc:hig:wpaper:198/ec/2018
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    References listed on IDEAS

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    More about this item

    Keywords

    demand; performing arts; consumer segments; willingness-to-pay.;

    JEL classification:

    • Z11 - Other Special Topics - - Cultural Economics - - - Economics of the Arts and Literature
    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis

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