Industry Overview
The Karaoke culture is popular in East Asia. Unlike the karaoke in bars/clubs offered publicly, the karaoke style here I want to discuss is the one has private rooms for different size of parties, and that is why the concept of Revenue Management can be applied broadly in this industry. I will specifically focus in Taiwan, because the karaoke culture in Taiwan is mature, and the company even expand the business to other countries.
The word “Karaoke” is originated from Japanese, so is the culture. Karaoke is firstly developed in Japan in 1970’s and then expanded to other countries in Asia in 1980’s, but the origin of the idea is obscure. Reference: http://en.wikipedia.org/wiki/Karaoke
In Taiwan, karaoke plays an important role in people’s nightlife. It’s the place for family, friends, colleagues, and even doing business. The karaoke industry in Taiwan is dominant by one company which has two different brands, one for higher class (more expensive) and the other one for lower class (cheaper). Higher class brand charges more with its glorious and hotel-look lobby, fancier private room decoration, more delicious food, and convenience (in-room restroom). There is another premium venue of that company that doesn’t see as a brand but more like a status, because it is limited to members, and joining the membership is by invitation (http://www.cashboxvip.com/viprespect.html). Thus, people start to consider going to karaoke as a luxurious entertainment, not to mention it seems to be a trend for the hotels in Hong Kong and Macau to design presidential suites with an “entertainment room” when we visited last June. Since people can easily spend hours in karaoke, the revenue can be generated in many ways. I will discuss the application based on my observations and experiences in Taiwan, and karaokes in Taiwan also do a better job than karaokes in Singapore on applying revenue management.
(Website of karaoke in Singapore:
a. http://www.partyworldktv.com.sg/promotion-29305210352041938144.html
b. http://www.kbox.com.sg/StaticContent.aspx?u=6)
The following are the overview of basic levers applied in Taiwan:
Space: (not applied in Singapore)
Karaoke has limited capacity, as the number of private rooms are fixed. Also, the size of the private rooms usually vary from small for 3 to 4 people to party size, 18-20 people, or even super party size for up to 35 people.
Time:
The time slot is limited, but the minimum consumption unit vary as the size of private rooms. Usually the rack rate is charged by hour, but promotion packages are charged based on 3-hour consumption, and you can extend by hour as the basic unit.
Also, karaokes apply dynamic pricing according to peak/off-peak hour and high/low season. The prices are differentiated by time of day, day of week, and month of year.
Occupation: (not applied in Singapore)
In Taiwan, students and senior are privileged for cheaper price. People older than the age of 55 are able to enjoy senior discount, as 55 is the minimum age to retire in Taiwan. The reasons may be students are more price-sensitive, but they also have more free time to spend in karaokes, and seniors also have more free time once they retire.
(Unfortunately, the website of the dominant company is in Mandarin, but I think you can still figure out how variable their prices are! Variable pricing charged by per person: http://www.cashboxparty.com/ktv/web_ktv/web_ktv.asp
Rack rate charged by hour per room: http://www.cashboxparty.com/ktv/map/price/kp17.html)
The Levers
SPACE
The inventory unit for karaokes is private room. A karaoke can be as big as a maze with narrow hallways and unorganized directions so it can utilize the space to its maximum. Karaokes define the space implicitly, because the size categories vary according to the space of each branch. Likewise, the capacity of private rooms varies in different branches. The following are the different private room sizes of the biggest karaoke branch in that company:
Small – 2 to 7 people
Medium – 8 to 10 people
Medium big – 10 to 12 people
Big – 12 to 15 people
Super big – 15 – 18 peope
Party size (“Presidential Suite”) – 18 – 35 people
Other utilizations of space:
a. Other than the main revenue generator, private rooms, karaokes utilize spaces for a major human need, food. Consumers not only can order in-room dining in a la carte style, but also can go to buffet area for all-you-can-eat service. Of course the delicacy level is depending on the class of the brand.
b. Another space utilization for karaoke is to selling company-branded products, such as stationary or products signed by famous singers, but it accounts for a very little part of the revenue.
c. In one of the signature karaokes of this company, there is a restaurant serving Cantonese Dim-Sum inside the karaoke. It is a rare but a brilliant concept. For people who go to karaoke but is not that into singing, they may go to that restaurant so they can eat food at the table with more comfortable height. Also, after an all-night singing, people in Taiwan like to have either a late night snack or early breakfast before dawn. The idea of the restaurant can attract people who bother which restaurant to go to. http://www.cashboxparty.com/ktv/cashboxdining/
Karaokes tend to save spaces for private rooms, as the more parties they can accommodate, the more revenue it can generate. To increase more revenue by using space, both brands may consider charging private rooms according to the distance to buffet area. The closer to buffet area, the more expensive the room rent, since people can save more time on going back and forth for food and drinks.
TIME
Karaoke sells time explicitly. The prices are either charged by per private room per hour, or by per person per certain time slot (ex. by per person for 3 hours). The pricing differs as follows:
a. Hour – separate a day into 5 different slots: (http://www.cashboxparty.com/ktv/map/price/kp17.html)
07:00-10:59 – the cheapest
11:00-15:59
16:00-17:59
18:00-19:59
20:00-22:59(Sunday to Thursday) 20:00-01:59(Friday and Saturday) – the most expensive
23:00-06:59(Sunday to Thursday) 02:00-06:59(Friday and Saturday)
b. Day of week
As what I mentioned above, Friday and Saturday are considered as “peak season”, and Monday to Thursday are “off-peak season”. The pricing for Sunday is slightly higher than weekdays but much lower than Friday and Saturday.
c. Month of year
This pricing differentiation is specially catered to student groups. Since students in Taiwan have winter vacation (3 to 4 weeks long in January and February) and summer vacation (8 to 9 weeks long in July and August), it is less often for students to go to karaokes with friends or classmates.
d. Special holidays
Public holidays are considered as peak season for karaokes, such as Christmas and spring break (can last from 3 – 5 days to celebrate Tomb-sweeping Day and Children’s Day)
Apart from the above explicit specifications of time, I suggest karaokes can consider to charge implicitly by the number of songs. It is not uncommon that the time we pay for the private room is about to end, but my favorite song is not played yet. If people can pay by songs, then such situation can be avoided and customers can also leave without pity.
PRICE
Karaoke uses physical and non-physical rate fences to differentiate its pricing, but the application of physical rate fences is far less than non-physical.
a. Physical rate fences are the size of private rooms, minimum charge for party size private room, and location of the karaoke branch. It is obvious that karaoke locating in downtown business area or in prime cities can charge higher than other locations. (Minimum rental list for Presidential Suite: http://www.cashboxparty.com/ktv/act/1001118_17/)
b. Non-physical rate fences are occupation (student), age (senior and birthday discount), membership (membership of karaoke and certain credit card holder), and time.
Other non-physical rate fences that I think is doable are advanced reservation and distance to buffet. To manage inventory more efficiently, karaokes can consider charge slightly higher for walk-ins in peak hour or hot season. Also, as what I have mentioned, it is possible for people to pay more for a private room which is closer to buffet area.
That appears to be excellent however i am still not too sure that I like it. At any rate will look far more into it and decide personally! Dragonball Miner KS6 Pro+
I’m keen on the various blogposts, When i severely preferred, I’d prefer specifics about the item, due to the fact it is superb., Best wishes concerning producing. st martin villas
“I’m also writing to let you be aware of of the wonderful encounter our child had viewing your web page. She came to find several details, including how it is like to have a very effective giving nature to get many more without problems have an understanding of specified impossible subject matter. You actually exceeded our desires. Many thanks for churning out such insightful, trusted, explanatory and also fun tips about this topic to Jane.” lagoa encantada em ilheus
Hope you will update the article. I still like the blog ilheus lagoa encantada
Appreciating the time and effort you put into your blog, I’m adding your RSS feeds to my Google account. اسلیو معده در تهران
Hi i would really love to subscribe and read your blog posts , POS system for retail shop
The best platform for playing online betting with the enjoyment of abundant prizes, for that, just visit the website betawislot
“Top-notch quality from BClub CM!”
“BClub CM’s attention to detail is amazing.”https://bclubb.net/
slot gacor spin298 merupakan link situs slot online gacor terbaru hari ini yang gampang maxwin dan anti rungkad agen judi slot88 online resmi terbaik yang ada di Indonesia.
Normal appointments listed here are the easiest method to thanks for the work, that means that I am going to the website daily, searching for brand new, fascinating data. Numerous, thank you! top up domino
This post really brought a much needed new perspective. Thank you for sharing the insights and inspiration. I feel more motivated to live life with more passion and gratitude! https://sm18.net
IReading this blog is always a refreshing experience. Your words are like an oasis in the midst of the hustle and bustle of everyday life. Thank you for being a source of inspiration and motivation! https://tuangoumaifang.com
You really make it seem so easy with your presentation but I find this topic to be really something that I think I would never understand. It seems too complex and extremely broad for me. I’m looking forward for your next post, I’ll try to get the hang of it! copisteria bergamo
I real pleased to find this web site on bing, just what I was searching for : D as well saved to bookmarks . biglietti da visita bergamo
Well done! I thank you your blog post to this matter. It has been insightful. my blog: how to make a girl fall in love galvanisieren auf kunststoff
What a delightful reading experience! Your storytelling is so lively and engaging. Thank you for brightening my day with this writing! https://123sfw.com
Terimakasih atas beritanya pak, Saya Tunggu Berita yang barunya lagi Genset Genpac Open / Silent Cummins 80 kVA GC80
Your writing always makes me happy! I always laugh and am entertained every time I read this blog. Thank you for bringing cheerful colors into my life! https://uxi307.com
thanks atas share informasinya semoga bertambah lagi ilmunya DURABELT EP 125 Rubber Conveyor Belts 5 Ply BW 800
Situs Anda selalu memberikan berita yang update, menarik dan bermanfaat Genset Genpac Open / Silent Cummins 60 kVA GC60
Good day, Can I export your post picture and apply that on my personal blogging site? Online POS System
Employee relations should be given more importance in an office environment as well as on any other business establishment.. POS systems for retail stores
Well, this Thursday I read through a couple of your posts. I must say this is one of your better ones. Have a nice day! Alopecia Baldness
Agen Bandar Slot Gampang Menang Minimal Bet 200perak nikmati slot luar negeri dengan bonus new member 50% auto cuan Sekawanbet
I wanted to say thank you to you for this excellent read!! I have you saved as a favorite to see fresh stuff you post. Hair Dropping Out
performing arts is my thing, i am very much interested to learn more on this art’ dewatogel
informasi yang bagus sekali semoga info ini bermanfaat DURABELT EP 125 Rubber Conveyor Belts 5 Ply BW 1000
This will be the correct weblog for hopes to be made aware of this topic. You recognize a great deal its practically challenging to argue along with you (not too I really would want…HaHa). You definitely put a different spin on the topic thats been revealed for a long time. Fantastic stuff, just fantastic! Hair Loss Thinning
The leading slot game bookie site is the most popular right now because it offers fun games, it has also been crowned as the safest digital gaming platform and only through this link can you get the highest maxwin. To find out more information, just visit this website betawislot
Get the best online slot playing experience from various providers that will lead you to abundant profits. agentotoplay
It proved to be Very helpful to me and I am sure to all the commentators here! omega x mercury in ksa
Vape UAE is a premier online retailer specializing in a wide range of vaping products and accessories. Committed to offering the highest quality e-liquids, vape mods, disposable vapes, and accessories, Vape UAE caters to both beginners and experienced vapers.
The Olympics 2024 will be held in Paris, France, from July 26 to August 11, showcasing athletes from around the globe competing in a variety of sports, including innovative events like breakdancing, emphasizing sustainability and cultural celebration.
Vape Dubai King offers a premier selection of vaping products in Dubai, catering to both beginners and experienced vapers. They provide a wide range of e-liquids, devices, and accessories from top brands, ensuring high quality and satisfaction.
You sound so passionate about what you are writing. Keep up the good work. tuning auto elettriche
SLOT777 adalah sebuah situs slot demo pragmatic play terlengkap dan terpercaya dengan fitur rtp slot tertinggi saat ini di Indonesia alexistogel
Simply desire to say your article is as astonishing. The clarity on your publish is simply spectacular and that i could suppose you’re a professional in this subject. Well with your permission let me to grasp your RSS feed to stay up to date with drawing close post. Thanks one million and please carry on the enjoyable work. زيادة متابعين تيك توك
Situs Bola Online Terpercaya SBOBET Pathner Official dengan pasaran odds terbaik se Asia & bonus parlay terbesar Sekawanbet
http://www.sekabet.net
Güncel Sekabet giriş adresini buradan öğrenin ve online bahis dünyasında güvenli bir yolculuğa başlayın. En heyecan verici oyunlar ve cazip bonuslar için Sekabet’in en son erişim bilgilerini keşfedin!
It’s difficult to acquire knowledgeable folks within this topic, however you be understood as there’s more you are discussing! Thanks grafica bergamo
I’m interested in using some of your material for my website. Please let me know if that’s OK and I will link back to this page. aziende grafiche bergamo
It’s exhausting to find educated people on this topic, however you sound like you recognize what you’re speaking about! Thanks godzilla168
I can feel the dedication and hard work you put into each post. Keep it up, your work is much appreciated! https://123sfw.com
Thanks For sharing this Superb article.I use this Article to show my assignment in college.it is useful For me Great Work. Weekend getaway deals
The little details in your writing really bring it to life. I really appreciate your thoroughness and attention to detail. https://zhlc8.com
Dari slot klasik hingga slot video terbaru, pemain dapat menemukan ulasan dan panduan lengkap di Prediksi77. Informasi ini membantu pemain untuk memahami cara kerja setiap permainan dan memilih slot.
Very informative post! Do you have any further suggestions on [topic]? I would love to learn more. https://www-431616.com
Salah satu situs yang kian naik daun di dunia perjudian online adalah Casino Prediksi77. Situs ini menawarkan berbagai fitur menarik.
Youre so cool! I dont suppose Ive read anything in this way before. So nice to discover somebody with a few original thoughts on this subject. realy appreciation for beginning this up. this web site is something that is required over the internet, a person with a little originality. useful job for bringing something new to the web! عمل بینی طبیعی مردانه