A few weeks ago, I had a surprise opportunity to attend a Nashville Predators home game at Bridgestone Arena in downtown Nashville. In the interest of backstory and not digression, I used to commute to Nashville every day and had a paid monthly contract for parking privileges at a garage adjacent to Bridgestone Arena. On event nights at Bridgestone, I would see the garage management move a sign to the mouth of the garage – $30 for event parking! That’s a lot, even by boom town standards. Once, I saw $40. As shocking as that might be, it was pretty sweet on the nights I had tickets to a Bridgestone event, knowing I had it covered through my contract.
Please do not get me wrong. I understand the interaction of supply and demand forces and do not begrudge the owner for charging $30 or $40. If they were smart enough to buy the location and put the capital at risk to build the garage, more power to them. I must admit that it is a premier location, nestled among Bridgestone, the Schermerhorn Symphony Hall, and the Country Music Hall of Fame.
For this recent experience at the Bridgestone Arena, I no longer had the luxury of my monthly parking pass, having retired from the banking industry months previous. I was now a transactional consumer with choices to make. I chose a surface lot a few blocks from the arena – easy walking distance, affordable pricing, and, from what I could tell, well-positioned for exit post-game.
I parked and walked a few hundred feet to the machine to pay, grab my ticket, and walk back to place the ticket on my dash. You know the routine. True to form, the pay machine seemed a little grumpy to be at work that night. Each person in line had a difficulty of some sort. I watched people retrace the directions in slow motion to make sure they had not missed something important. Some cajoled the machine by tenderly easing their card in and out. Others used the more aggressive quick wrist snap on the card. Each person seemed to have their own nuance and strategy. Thankfully, I was not in a hurry, at least not when I arrived.
I fared better than most people when my turn came. I pulled my card too early on the first try. I got my receipt on my second try, but immediately noticed that the charged amount was an oddball amount with numbers after the decimal place. I had expected the well-rounded $15.00 as advertised. Sales tax passed on to the consumer possibly? My eyes darted up and down the left side of the receipt, where all the letters were, looking for some explanation. There it was – taunting me, pushing MY buttons – the convenience fee.
It just did not feel convenient to me at all. I still had a few hundred feet back to my car to prove I had paid for my stall, then a return trip through the lot on my way to the arena. What would have been convenient for me would have been to hang Abe and Alexander out my window as I passed a super-friendly parking attendant, probably never completely stopping my car. (Apparently those people do not exist any longer.) Sure, there was some teamwork and bolstering at the pay machine as each person worked through their issues, but it was not convenient, at least not for me.
I have never regarded myself as one of those “profits are bad” socialist types. I believe in fair prices for value delivered, fair returns for shareholders for risks taken, and I have a healthy respect for the laws of supply and demand – the glorious and inglorious. All kinds of stuff can happen in the free market.
More and more, I find convenience fees on the tab for a wide variety of services. Sometimes, the fees truly reflect a higher level of convenience for me. I am glad to pay for it. A former client of mine in the logistics and transportation business once told me, “don’t ever forget that the price of anything is delivered…” He was heavily involved in commodity transport. His clients obsessed over Chicago Board of Trade prices. He was successful in convincing them that they needed to be equally judicious about freight rates. For many, his intermodal logistics approach offered significant savings to the final delivered price, and his seamless approach was convenient for his clients.
I have been wrestling with this one since it happened. If convenience is a bona fide strategy of your business, should it not be included in your price, as part of your value proposition? That seemed to be the position of my contract parking garage, charging double the stated rate of the lot I chose for the primo position of the garage. If a convenience fee has little to do with the product and simply the means of payment, shouldn’t a consumer be provided with payment options? If a business has to tell me their offering is convenient, and assign a value to it, I am just not so sure that it really is all that convenient.
At Bizzics, Client Connection is critical to building and maintaining momentum in your business. If your business has built convenience as a strategy, be proud of it and include it in your price. Build relationships on it and resist the urge to be transactional.