Back in October, 2007, the band Radiohead launched a new CD and made the album only available to buy online. In exchange for the CD, they asked consumers to go ahead pay what they wanted for the CD. No set price. People could just pay what they wanted. In response, the band sold 1.75 million CDs in the UK (another 1.25 million in the US) and sold millions of plays on various pay sites. Retail sales of their boxed set increased, as did the number of of concert tickets they sold.
And in the process, a new retail pricing model began. Provide something of value, and ask people to pay what they feel is the real value of it.
Recently, Panera bread launched a similar model where people could order their meals, cashiers tell the customers the "suggested" price -- and people then pay what they want. After the first trial period, about 70% of people agreed to pay the suggested price, 15% paid less, and about 15% paid more. There were, of course, some free-loaders, but there were also a lot of people willing to pay $20 for a cup of coffee.
Interestingly, as people have experimented with the idea, and done some testing, it turns out that people are more likely to pay more if they are told that "excess" money is going to help a charity vs going to line some business owner's profits. When a charity was involved, the casual freeloaders balked at the idea of paying nothing because it was more likely to reflect badly on them, yet customers with a desire for the priduct and the cause were willing to pay for both.
Which leads me to ask the question, can shelters and rescues succeed with a pay what you wish pricing model? As charities (in most cases) themselves, they have a built in charity to them.
So let's say the "suggested" adoption fee is $50. What if we went to pay-what-you wish pricing? Would some people take free adoptions? Most likely -- and honestly, if they're good homes, that's probably ok. And on the flip side, if someone with some money came in to adopt, would they be willing to leave $100 with the extra to "help out" other animals? Most likely, yes.
I think it's interesting that many mainstream businesses have ventured into the pay-what-you wish pricing...and I'm wondering if anyone out there of a shelter that has tried this at all and what the results were from it. It sure seems like a great way to get a lot of publicity, overcome price barriers for adoptions, generate a lot of good will in the community -- and maybe get some high-dollar donations for adoptions in the process.
And, most importantly, find a lot of good homes for homeless animals -- which is the true end goal.
For more: Are "pay what you want" animal adoptions a good idea? - from Change.org