by

Revenue Management Application on Karaoke Industry in Taiwan

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.

46,654 thoughts on “Revenue Management Application on Karaoke Industry in Taiwan”

  1. Selling an AWS (Amazon Web Services) account is strictly prohibited under AWS’s terms of service. AWS accounts are non-transferable, meaning you cannot legally sell or transfer ownership to another party. Attempting to sell an AWS account could result in the suspension or permanent termination of the account, along with possible legal and financial consequences.

    AWS Account Salestore sensitive information, including billing data and cloud resources, making them highly vulnerable in the wrong hands. Selling an account puts both the seller and buyer at significant risk. The original account holder could remain liable for any outstanding charges or misuse of the account, even after the sale. Additionally, the buyer could inherit unforeseen costs or security issues.

    If you no longer need your AWS account, the recommended approach is to close the account or transfer specific resources to another AWS account. AWS provides tools for transferring services like EC2 instances, S3 storage, and more, without violating their policies.

  2. I’m pretty pleased to find this page. I need to to thank you for ones time for this particularly wonderful read!!
    I definitely appreciated every little bit of it and I have you saved to fav to check out new information on your
    web site.

    Look at my web-site :: bokep dewasa

  3. I’ve been exploring BLACK SEO LINKS – BUY BACKLINKS – SOFTWARE FOR MASS BACKLINKING – TELEGRAM @SEO_LINKK a
    bit for any high-quality articles or blog posts on this kind
    of area . Exploring in Yahoo I ultimately stumbled upon this site.

    Studying this information So i am happy to express that I have
    an incredibly excellent uncanny feeling I came upon exactly what
    I needed. I so much no doubt will make sure to don?t put
    out of your mind this site and give it a glance on a continuing basis.

  4. Gracias por compartir esta información tan valiosa.
    La salud es lo más importante y este tipo de contenido lo
    demuestra.
    Este contenido me ayudó a entender mejor el tema.
    La data sobre análisis médicos es clave.
    Nunca había considerado esto de esa manera.
    Gracias por proporcionar esta información.
    Este tipo de artículos son necesarios.
    Gracias por desglosar la información de manera sencilla.

    Es bueno ver contenido que destaque su importancia.

    Muy útil para quienes buscan consejos sobre salud.
    Gracias por subrayar la importancia de la salud preventiva.

    Me gusta cómo abordas el tema de los laboratorios.
    Gracias por compartir esta valiosa información.
    Esto es justo lo que necesitaba leer.
    Un contenido que sin duda es valioso.
    Este es un artículo que recomendaría leer.
    La salud es prioridad y esto lo deja claro.
    Esto es lo que todos deberíamos saber.
    Es bueno ver artículos que destacan la importancia de
    los laboratorios.
    Este tipo de información es necesaria para todos.

    La salud es algo que todos debemos priorizar.
    Un artículo muy informativo y necesario.
    Es un gran recurso para quienes buscan aprender más sobre salud.

    Gracias por abordar este tema con tanta claridad.

    Gracias por explicar esto de manera tan clara.
    Un excelente artículo sobre la salud y sus cuidados.
    Gracias por este artículo tan bien detallado.
    Es importante estar bien informado sobre salud.
    Gracias por la información tan útil.
    Un artículo muy valioso sobre un tema importante.
    Gracias por compartir esta información tan necesaria.
    Gracias por destacar este aspecto tan importante.
    Gracias por compartir esta información tan clara.
    Es un tema importante y bien explicado.
    Es un gran recurso para quienes buscan información fiable.

    Un artículo muy interesante y bien explicado.
    Un contenido muy valioso sobre salud.
    Un gran recurso para la comunidad.
    Un gran contenido sobre salud y bienestar.
    Gracias por explicar esto de manera tan clara.
    Es vital entender esto y tu artículo ayuda mucho.
    Esto es lo que todos necesitamos saber.
    Siempre es útil tener información clara sobre temas de
    salud.
    Es importante estar bien informado sobre salud y bienestar.

    Esto es lo que todos deberíamos leer.
    Es fundamental entender esto y tu artículo ayuda
    mucho.
    Un excelente recurso para quienes buscan mejorar su salud.

    También visita mi web blog: dra. Stephanie

  6. Hi there, just became aware of your blog through Google, and found that it is truly informative.
    I am going to watch out for brussels. I’ll appreciate if you
    continue this in future. Many people will be benefited from
    your writing. Cheers!

    Feel free to visit my site :: Pinterest

  9. I abssolutely love your bblog annd find mot of your post’s tto
    bbe juust wwhat I’m looking for. can you offger gguest writers too writfe content
    available foor you? I wouldn’t minnd pubhlishing a post oor elabrating onn most off thee subjects you write regareding here.
    Again, awssome weblog!

    Alsso visit my page jav xxx

  14. Price in Bangladesh.com a rapidly growing economy in South Asia, presents a unique pricing landscape shaped by local production, import dependency, and evolving consumer needs. Whether you’re a consumer, business owner, or visitor, understanding the price structure for goods and services is essential for navigating the market effectively.

    This blog offers a detailed look into pricing trends across various categories, providing insights into what drives these costs and how you can make informed decisions in the Bangladeshi marketplace.

  16. Price in Bangladesh.com a vibrant and rapidly developing country in South Asia, is renowned for its bustling markets, growing economy, and diverse consumer needs. With a thriving population and a mix of traditional and modern lifestyles, understanding prices in Bangladesh is essential for consumers, business owners, and international investors.

    This article offers a detailed exploration of prices across various sectors in Bangladesh, identifying key factors that influence costs and providing actionable insights to help consumers make informed decisions. By delving into groceries, electronics, real estate, fashion, and more, this guide ensures a well-rounded understanding of Bangladesh’s pricing landscape.

  20. Wow, suⲣerb blog layout! How long have you been blogging for?
    you made blogging look easy. The overall look of youг site is excellent, let
    aⅼone the content!

    Also visit my blog post – Online Sex Chat

  22. นคืออะไร? รู้จักตัวยายอดนิยมที่ทำให้วัยรุ่นหลายคนติดใจ
    ถอดความหมายว่า ลีนคืออะไร ? โดยลีนนอกมีชื่อภาษาอังกฤษว่า “ Lean ” ซึ่งไม่ใช่ยี่ห้อของยาแต่จะเป็นชื่อเรียกของกลุ่มตัวยาที่ใช้สำหรับผสมเครื่องดื่ม เพื่อกระตุ้นอารมณ์และทำให้ผู้ใช้รู้สึกผ่อนคลาย ซึ่งปกติยาที่นำมาใช้ผสมจะเป็นยาที่ใช้รักษาทางการแพทย์ในกลุ่มอาการแก้แพ้ แก้ไอ แก้ปวด ยาคลายกล้ามเนื้อและยาลดความเครียด แต่เมื่อนำลีนนอกมาผสมเป็นสูตรต่างๆ แล้วจะทำให้เครื่องดื่มลีนมีรสชาติที่หวานและอร่อย

    ในส่วนของอาการผู้ใช้ Lean Syrup จะมีทั้งความรู้สึกมึนเมา ง่วงซึม เคลิบเคลิ้ม ความคิดสร้างสรรค์ เป็นต้น ซึ่งทั้งหมดก็ขึ้นอยู่กับปริมาณและประเภทตัวยา เพราะฉะนั้น ยาลีนคืออะไร ? ก็คือยาผสมเครื่องดื่มเพื่อสร้างความมึนเมาและความเพลิดเพลินนั่นเอง

    ยาเขียวเหลือง

  29. I’m impressed, I must say. Actually rarely do I encounter a blog that’s both educative and entertaining, and without a doubt, you could have hit the nail about the head. Your thought is outstanding; ab muscles an element that insufficient everyone is speaking intelligently about. My business is happy which i came across this during my hunt for something about it. prestar serviços

  30. Hi there! Someone in my Facebook group shared this website with us so I came to check it out.
    I’m definitely enjoying the information. I’m book-marking and will be tweeting
    this to my followers! Outstanding blog and fantastic design.

    Here is my web blog :: canadian pharmacies

  34. I know this is one of the most meaningful information for me. And I’m animated reading your article. But should remark on some general things, the website style is perfect; the articles are great. Thanks for the ton of tangible and attainable help. check out this site

  35. ยาแก้ไอ คืออะไร เครื่องดื่มที่กลุ่มวัยรุ่นนิยมใช้
    หลายคนอาจสงสัยว่าการดื่มยาแก้ไอเพื่อใช้เป็นเครื่องดื่มสำหรับมึนเมาของวัยรุ่นอยู่ปัจจุบันนี้นั้น มีรูปแบบการใช้งานอย่างไร หรือมีความปลอดภัยมากน้อยแค่ไหน โดยก่อนอื่นเราต้องบอกเลยว่าการดื่มยาแก้ไอนั้น ไม่ใช่การกินยาแบบเพียวแต่อย่างใด แต่โดยส่วนใหญ่เป็นการใช้ยาแก้ไอละลายเสมหะผู้ใหญ่

    แบบน้ำและเม็ดมาเป็นส่วนผสมในเครื่องดื่มรสชาติต่าง ๆ เพื่อทำให้เกิดการเคลิ้มและมึนเมาได้ รวมไปถึงสามารถบรรเทาอาการปวดในบางจุดของร่างกายได้อีกด้วย เพราะสารในยาแก้ไอ มีสารประกอบหลักอย่าง Promethazine ซึ่งช่วยในเรื่องของการทำให้ผ่อนคลาย และบรรเทาอาการปวดได้อีกด้วย

    ยูนิแลค

  36. Thanks for taking the time to talk about this, I feel fervently about this and I take pleasure in learning about this topic. Please, as you gain information, please update this blog with more information. I have found it very useful. There have to be charging stations everywhere. encanador

  38. After study several of the blogs with your website now, i truly much like your strategy for blogging. I bookmarked it to my bookmark web site list and will be checking back soon. Pls look at my internet site at the same time and make me aware if you agree. engenheiro

  39. The internet has been considered as one of the best ways to find a reputed and known SEO company. Apart from high quality services, its response towards customers is prompt and satisfactory. Search a company and get associated with it for your SEO services. pedreiro

  41. Konya Escort Bayan

    Merhaba tatlım benimle geçireceğin Konya Escort bayan hizmetinde mutluluğun dibine vurmaya hazırsan. Telefon numaramdan dilediğin zaman Konya Escort Bayan fantezisinde sizleri bekliyor olacağım. Farklı tatların tek adresinden selamlar.

  44. Understanding the importance of gaming on the go, WW88 offers a mobile-optimized platform and apps that provide full functionality and a smooth gaming experience on smartphones and tablets. ww88

  46. It’s a pity you don’t have a donate button! I’d certainly donate to this superb blog!
    I guess for now i’ll settle for book-marking and adding your
    RSS feed to my Google account. I look forward to new updates and will share this website with my Facebook group.
    Chat soon!

    Here is my page: Jackpot Bet Online

  48. I am really enjoying the theme/design of your website.
    Do you ever run into any browser compatibility problems?

    A number of my blog readers have complained about my website not working correctly in Explorer but looks great in Chrome.
    Do you have any suggestions to help fix this issue?

    Feel free to surf to my webpage … Boost SEO with Guest on Uplinke.com

  50. Pretty section of content. I just stumbled upon your blog and in accession capital to assert that
    I acquire actually enjoyed account your blog posts. Anyway I will be subscribing to your
    feeds and even I achievement you access consistently rapidly.

    Here is my blog post shkoh

Leave a Reply

Your email address will not be published. Required fields are marked *