Court+ pricing model (Bill Splitting)
The Court+ pricing model is a unique model used exclusively by PodPlay’s system to resolve the Club issue of the free-rider problem. The free-rider problem is a challenge that every Club faces when offering Memberships that discount the rate of a court for Customers who are Members versus Non-members
The Free-rider problem in an example:
A Non-member books a private court for $60 and invites their friends (other Non-members) to the Reservation
The court cost is split evenly among the participants, each paying $15
A Member books a private court for $44 (a Membership benefit of booking courts for 27% less) and invites their friends (Non-members) to the Reservation
The court cost is split evenly among the participants, each paying $11
When a Member books a court instead of a Non-member, the Non-members who join the Member’s Reservation are free-riders, taking advantage of the Member’s perks without needing the pay the Club for a Membership. To learn more, read Evaluate Membership Models for Your Club.
This friction point of the free-rider problem is resolved with PodPlay’s Court+ pricing model, and specifically with the Non-member fee charged at check-in, the Day Pass Non-member Fee.
Reviewing this in an example:
A Membership with valuable perks, like discounted private court Reservations, is available to Customers
A Non-member books a private court for $60 and invites their friends (other Non-members) to the Reservation
The court cost is split evenly among the participants, each paying $15
A Member books a private court for $44 and invites their friends (Non-members) to the Reservation
The court cost is split evenly among the participants, and the Non-members pay their fee, resulting in the Member paying $11 and the Non-members paying $11 + $n (where $n = the Non-member Fee)
And the Club has the flexibility to pick any amount they wish as the value for $n, and the $n is charged to the Non-member once per day.
With the Court+ model, the Club is guaranteed their revenue for the Reservation because if there is a charge failure or cancellation:
Charge Failure: the Reservation Holder covers for any invitee who has a failed charge on their card after they have accepted the invite
Cancellation by Invitee: the balance of the court is shared equally amongst the Reservation Holder and remaining invitees, regardless of any Customer invited to the Reservation who does not accept or cancels last minute
For any Non-members participating in the Reservation that has a hold put on their card for their share of the Reservation + $n, only the Non-member will pay their respective $n, unless the Reservation Holder has elected to send an invitation pay for their friend’s spot
To learn more about the Court+ pricing model in action, read these articles: