When I mentioned The Financial Buff’s Behavioral Economics Explanation for Sensitivity on Service Fees a couple weeks back, I didn’t think an example of this would come to my attention so quickly. But first, a quick recap of TFB’s article. His discussion focused on how people reacted to the $5/mo debit card fee that Bank of America was about to
inflict charge on its victims customers. This was the first example, baggage fees, another. Today, here’s mine.
This is a ticket (redacted to eliminate my info) to an upcoming concert. The ticket price is $125, which I guess is within reason, good baseball tickets cost this much and there’s 90 chances to see the local team play at home. Yanni, or any performer is pretty limited in how often you can see them play live. But the thing I found irksome was the ticketing fee, $18.50. There’s a transaction cost the credit card processor charges, and I get a 2% rebate each month, so there’s $2.50, it’s the balance of $16 to process this transaction that I object to. The agent has little overhead to handle this ticket, in fact they print nothing and mail nothing out. It was all done electronically. Here’s the crazy thing – If the tickets showed a price of $150 with a $1 mailing fee or free to print yourself, I’d have been happy and thought this a great deal. It’s only when the fee is broken out and I see I’ve paid $37 to process two tickets that I feel ripped off. Not enough to avoid the transaction of course, but just enough to write about it. Last I saw Yanni live was over 20 years ago, before I was married, and he gave a great concert, looking forward to seeing him again. But I won’t be buying popcorn there.