Economics of this Halloween party

On Saturday, I’ll be attending the Ghost Ship Halloween party, mainly because several of my good friends are going.  I was wrangled into the party a few weeks ago when one of them sent out an email directing us to the ticketing website.

This post is about the cleverness of the Ghost Ship’s ticketing strategy.

The pricing structure looked something like this*:

  • Super Early-bird Presale: $25
  • Early-bird Presale: $30
  • Regular Presale: $35
  • Presale: $40
  • Last Chance Presale: $45

*I couldn’t remember what the names of each tier were, so I made them up. You get the idea.

These weren’t actually time-sensitive tickets; sales for each tier all ended a few days before the party. At the time the tickets were posted, you could purchase any one of these options.  I could theoretically purchase the Super Early-bird Presale or the Last Chance Presale.  Obviously, given the option, I’d prefer to purchase the less expensive ticket.

So, why wouldn’t everyone purchase the Super Early-bird Presale tickets?  Well, there were only a limited number of tickets at each pricing tier.  And those coming to the website closer do the date of the party would see which tiers sold out.  So, when I got to the website, the pricing structure looked more like this:

  • Super Early-bird Presale: $25 Sold Out
  • Early-bird Presale: $30 Sold Out
  • Regular Presale: $35 Sold Out
  • Presale: $40 Sold Out
  • Last Chance Presale: $45

I quickly purchased a ticket because, well, look at the ticket sales – a lot of people were apparently going to this party.

What’s going on here?  Ghost Ship was doing something pretty clever – they were using the ticket sales to publicly indicate how many people were purchasing tickets to the party.  The ticket sales were an indicator of the party’s popularity.

Not only that, but they were playing off of a phenomenon we discussed last week: Loss Aversion.  Tickets for Ghost Ship were selling out quickly, and I didn’t want to lose the opportunity to purchase one and attend the party … so I bought one.

There’s more to this story about ticket sales, such as the black market for tickets on Craigslist that erupted shortly after the final tier sold out, or the limited number of more expensive tickets available at the door (encouraging people to show up early), or the awesome costumes we made.  But this post is long enough as it is.

Happy Halloween!

Edit: This post got written up on the WePay blog!  Check it out here.

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