Front Row Center

Epistemic Sta­tus: Lightweight

Re­lated: Choices are Bad, Choices Are Really Bad

Yes­ter­day, my wife and I went out to see Ocean’s Eight (offi­cial re­view: as ad­ver­tised). The first place we went was a mas­sively over­priced the­ater (thanks MoviePass!) with as­signed seat­ing, but they were sold out (thanks MoviePass!) so we in­stead went to a differ­ent over­priced the­ater with­out as­signed seat­ing, and got tick­ets for a later show. We had some time, so we had a nice walk and came back for the show.

When we got back, there was nowhere for us to sit to­gether out­side of the first two rows. They’re too close, up where you have to strain your neck to see the screen. My wife took the last seat we could find a few rows be­hind that, and I got a seat in the sec­ond row. It was fine, but I’d have much preferred to sit to­gether.

It was, of course, our fault for show­ing up on time rather than early to a sold out screen­ing. I men­tion it be­cause it’s a clean ex­am­ple of how offer­ing less can provide more value.

The the­ater should, if they don’t want to do as­signed seat­ing, rip out the first two rows.

At first this seems crazy. Many peo­ple pre­fer sit­ting in the first two rows to be­ing un­able to at­tend the show, so the seats cre­ate value while in­creas­ing prof­its. What’s the harm?

The harm is in­tro­duc­ing risk, and cre­at­ing an ex­pen­sive auc­tion.

The risk is that if you go to the movies, es­pe­cially the movies you most want to see, you’ll be stuck in the first two rows. So when you buy a ticket and go up­stairs, you might get a bad ex­pe­rience. If the show is sold out, that might be bet­ter, as you can buy a differ­ent ticket or none at all.

The auc­tion is worse. Seats are first come, first serve. So if it’s im­por­tant to get served first, you need to come first. If it’s very im­por­tant to not be last, to avoid awful seats, you need to come early, and so does ev­ery­one else, bid­ding up the price of not-last the same way you’d bid up be­ing first.

With no awful seats, those who care a lot about bet­ter seats will still come early, but most peo­ple care a lot less. So ev­ery­one can come sub­stan­tially ear­lier, and not feel pres­sure. Many will show at the last minute, and be to­tally fine.

The dead­weight loss in time, of adding those forty ex­tra seats, is mas­sive, dis­tributed through­out the the­ater. Every­one feels pres­sure to get there early even when they already have a ticket, so even if their seat is good, they stressed out about their seat, and not only burned time but feel bad about be­ing pres­sured.

Avoid­ing time-based auc­tions and sig­nals, or at least min­i­miz­ing the value at stake in them, is an im­por­tant and un­der­ap­pre­ci­ated prob­lem.