CP Death Spiral
I must note that this was a post that I posted on another forum, which I wish to share with you all in regards to CP price increase at KTVs that eventually will bring down the whole fun of going to CP in the first place. This actually might even bring down the whole foundation of what CP is built upon, which is affordable fun for all mongers. Enjoy:
SSS my friend has a great theory that he once explained to me which I feel inclined to share with everyone on this board. It's his death spiral theory that is going on CP KTV scene recently.
First, let me give you a background of what is going on within China right now, which most of you are probably familiar with. China is getting richer! It's not just the coastal provinces and cities that are wealthy, it's also the inner provinces of Hunan, Hubei, Jiangxi, Chongqing, Sichuan, Shaanxi etc. As a result, many of the girls who use to come from these provinces to CP to work as a WG are finding no incentive to travel so far away from home anymore. Many of them are choosing to stay in their home province and just go to a big city there to work as a WG in the KTVs there, where they get paid even more money as a WG back at home. With the recent millionaires accumulating in developing third tier citities in the inner provinces of China, they too want have the capability to splurge and play in their KTVs as well. As a result, Girls are paid more, get to live closer to their home town or village. This equates to bad news for Guangdong Province KTVs in general, because it's becoming harder and harder to attract talent to KTVs.
So the logical solution for all of these CP KTVs and all other KTVs in all of Guangdong area is to increase the prices for sitting fees and take out fees, in an effort to get them back to CP KTVs to work. It seems great in theory. Initially this does attract lots of girls to come to CP. However, this brings about a negative consequence.
Let's take the classical 2-5-8 that was in place in CP for many years before this current jump in price.
Sitting fee is 200 and ST is 500 and LT is 800. That means that in the past, a girl only get 200 for sitting a customer. One pop gets them 250% more than just sitting there and LT overnight gets them 400% than just sitting there. There is a high incentive for girls to go out with customers. This model worked for many years.
Now the increase is 3-6-9.
Let's do the analysis here. 300 sitting fee, if they do ST 600 it's a 200% incentive than sitting and a 300% incentive for LT overnight session. You see how the incentive becomes less and less for girls to even want to go out? It may seem marginal, but psychologically it does play a part in indirectly making the less keen to want to go out.
Now it doesn't just stop there. Now CP these 2 years have really increased the fees in all of their KTV venues.
At Yihao models are 4-10-15, Eurasia is 5-15-20, Fuhao has super models for 4-10-15 and even Mayflower has models for 4-10-15 as well. Not to mention Royal Garden in Dalang Town is up to 1000 sitting fee 3000 ST and 5000 LT.
The hotels are all trying to repackage their girls and upsell them. As many of these girls are no taller or prettier than before. Many of the same girls as BSD has pointed out were only mere 2-5-8 girls 2 years ago.
The negative impact is extreme! If you are a model in these KTV establishment getting paid 400 or 500 just for sitting with a customer, what incentive do you have to even want to go out with customers? In fact I have single handedly witnessed with my own eyes, how a Yihao and Eurasia Model girl will be picked by a customer, walk into the room and act bored and bitchy and withdrawn on purpose, so that they customer will just pay them 400 or 500 to get rid of them because they are souring the mood. That same girl who just pocketed 400 or 500 from the customer will proceed to sit another room and get another 400 or 500 for another sitting fee.
Before the norm was that girl who give you good service were going to be rewarded with a take out so they could earn more money. Now, girls in KTVs are getting smarter. Why would they want act all nice and give great service to customers and get stuffed for 1500 and 2000, when they could act like a total ***** and sit 3 rooms and collect 1200 to 1500 by just doing nothing? What girl really wants to get stuffed by customers? Unless they really like the guy, really like sex or they want the money. But usually it's the last reason-money. But if you could get similar amount of money for doing less and not get poked, most girls will follow this trend. You will notice that girls these days are more and more picky. They will hide from you if they don't like you. Mommies can't even control their girls anymore because Mommies are having a hard time recruiting new girls. So recently, girls are getting off the hook even when they give bad service. Before many KTVs gave girls a quota of needing to have a certain number of rooms reserved through them or they get fined. Most KTVs have done away with all of these rules now because they are at the mercy of the girls-especially the pretty top tier girls.
You may think that sitting 2-3 rooms is out of the ordinary, but in reality on Thursdays, Fridays, Saturdays and sometimes even Sunday, it is very possible for most models in the tier 1 KTVs to sit 2-3 rooms easily.
So here comes the death spiral. KTVs increase the fee structure for girls to attract girls to CP. Which is good, they get them in the door. But girls have lesser incentive to go out with customers as a result of the high sitting fees they get. So a monger comes up to CP in hopes of having a good time and bringing home a pretty girl back to their hotel room for the evening. They spend on room fee, snacks, alcohol, DJ fees and then their girl rejects them and does not want to go home with them or acts like a total ***** that you just don't even want to bring her back to your hotel room. Customer becomes upset and thinks that it's not worth it anymore they refuse to come to KTVs as much. Less customers come to KTVs and then business is bad and then Girls end up leaving CP for another destination where they can rake in bigger bucks. KTVs lose girls / talent and customers and their business goes sour. If hotel business goes sour than other auxiliary businesses such as restaurants, footies, DVD stores, Cell phone stores, clothing shops etc in the surrounding area gets affected, including real estate and Taxi / transportation businesses as well. That's where the death spiral comes in.
Right now there is already a shift in attitude of the girls. I find that girls do not give as good service as they use to anymore. Many appear distant and cold. This is a similar opinion shared by many veterans on the board such as Jim Traveler in our previous conversation. It's not like how it use to be anymore where girls were dying to be picked by customers. Nowadays, it's almost as if girls are choosing customers. Look around at Yihao and Eurasia's flower street. You approach a cuter girl and if the cuter girl doesn't like you- some hide away from you or look away or even walk away to the bathroom. This trend will continue for now. But how sustainable is it, I am not quite sure.
BUt one thing is for sure. There is an increased number of Taiwanese mongers coming into CP recently. It's not just the recent 4 day Taiwan holiday, but overall Taiwanese are starting to catch onto CP and so there is a huge influx of them recently. Mostly from group tours and also with groups of friends coming into town. I know because I have first handedly witnessed how they have single handedly increased rates at Swan Lake Hotel, Clipper and Walter Hotel etc. As a result, you feel that there is a whole lots more mongers in town these days and thus rooms and KTV rooms, footies and even Saunas are hard to book these days. But perhaps after the freshness factor wears off it may stabilize a bit. So the current Taiwanese influx could also attribute to high demand in bookings recently-thus temporarily sustain this outrageous increase in fees. But I really don't know how CP KTVs can sustain this constant increase in the girl's tipping fees. But one thing is for sure, the death spiral has begun.
AsnDragon | |
