A remarkable business model that I stumbled upon.

A few months ago, I wrote about the death of trade shows because the shows that I went to were very disappointing for me. Yet, in the middle of one of one particular trade show stood a company that absolutely caught my attention.

How it Worked

I walked around the show with my heavy back pack (why I insist on taking this bag I’ll never know, but I did) and stumbled upon a small, out-of-the-way stand that offered massages. I looked at the signage and there was no indication of price. In fact, the sign didn’t tell me anything other than the company name: Mobile Massage UK. One of the masseurs saw me and she asked me to sit and one of the (7) therapists would be with me soon.

She then proceeded to tell me that for the pleasure of a massage “you pay what you think it is worth”. This is what surprised me. She offered the service, but no price – that was my choice based on what I thought about the service they offered. I, of course, accepted her offer as I had nothing to loose. If it was bad – no money. If it was good, then I would pay something. I didn’t have a clue what I would pay – but I knew it would be something.

As I sat there contemplating this and as the lady continued to massage her client – my masseuse became available. He explained to me again that he would give me a 10 minute head and back massage. At the end of the ten minutes I could pay what I thought was a fair price for the massage. He also told me that “people usually give between £5 and £20″ and that “10% of the money I give will go to a Children’s charity”. I still, of course, wanted my massage (which was very good and too be honest, I could do with another one now).

I sat there thinking about this model and how it worked. At the end, I paid £10, which equates to £1 per minute. I did think about 60p per minute, but that would mean asking for change. It seemed fair and neat to pay the £10. It was easy.

The lady that initially spoke to me owns this business and I was keen to talk to her about her company and especially the business model that she had chosen. She kindly spoke to me and answered every question that I had.

The Business Model

They had tried the fixed price for a massage – but she made more money this way (although she didn’t know how much more). She put on the signs once “pay what you think it’s worth” and business dropped dramatically. So all she had on the signs now was the name of the company (Mobile Massage UK).

People would walk by and stop and ask if the service was free (put on by the event organisers). This was, of course, planned. That initial question was the opener for the staff to give their story. They must get asked this question hundreds of time every day, and each time the patter is the same. Some people didn’t like this – but more often than not people sat down.

She (the owner) told me that a few times people didn’t pay and occasionally you get teenagers paying £2, but more often than not people did what I did – and paid £10 (which is actually expensive for a 10 minute quick back rub). So not only did she get more business, but the people seemed happy to be paying more for the service. She takes a risk on the price, but reaps the rewards of doing so.

The charity thing is because it is what people expect rather than out of a desire to change the world, “people in this country don’t like the idea of you making money – so the charity statement helps with that” she told me. She is obviously listening to her customers.

View more info at: http://www.mobilemassageuk.com/

What do you think to this idea? Have you experienced this yourself (I know there is a restaurant in London that does this for example)? Have you done this yourself?