![]() ![]() Price gouging is a popular tactic employed when a city / town gets these one-off events. Thirdly, will this event disrupt other “regular” business that you normally have, in that expected demand is larger than city capacity? Secondly, the number of days, as well as the actual event (stay) days of the week of the event, will also influence your pricing decisions. Is this something that solely attracts local visitors, or is this something that attracts visitors from further afield? “Firstly one has to evaluate the actual impact of the event. These large types of events tend to be announced well in advance, so what is key here is to be able to keep up the pace to that of the demand, so that rates increase as fast (if not faster) as that mentioned demand, being able, therefore, to maximize revenue.” ![]() We have seen in Europe how the announcement of the Coldplay Tour in 2023 has made prices surge almost as fast as demand, with tickets selling out within minutes and accommodation trying to catch up. If that is not the case, it will depend very much on the type of event. When you are in the first scenario, there is no need to calculate much, as you tend to adapt your forecast to the needs of the group, and often they take a large chunk of your inventory, leaving the rest of the inventory to do yield. “When a new major event comes to your city/destination, there are two options: either you host some of the organizers or participants, where you’ll have to quote based on their requests and needs, or you are a candidate to host fans or followers. Clearly, it will be impossible to find the perfect starting rate, but the goal is to find a starting price that is as close as possible to equilibrium in a situation that will inevitably present an uncertain scenario at the beginning.īecause of this uncertainty, it is always advisable to find the right balance also in inventory management, limiting the sale to compensate for the risk of a rate that could prove to be lower than what the market would be willing to spend.” ![]() It might be useful to take a look at how other similar hotels are performing, not to adapt or imitate them, but to exploit some competitive advantages in your favour. ![]() The study of this data from different sources can certainly help to understand the proportions that this event will entail, to try and define the best possible rate. The first clue is to understand the exact location where the event takes place, whether it is a congress, a concert, an important sporting event, the number of people it can potentially host or involve directly or indirectly (spectators, participants, journalists, technicians, workmen involved, etc.) and how much this number can impact demand in relation to the available offer of the destination.Īnother element to consider is the impact that these similar or identical events may have achieved in different destinations in the past. In both cases, of course, the risk is to burn potential turnover. In fact, the risk is to start with rates that are too low and materialize too many rooms and too quickly, or too high rates that risk having to be lowered after a few months and then be raised again in a dangerous roller-coaster effect. But being able to define the best possible starting prices in the presence of an event, and without historical data about it, is a more delicate and complex operation. In fact, once pickups or online visits related to the dates of the event begin to increase, the price dynamism becomes simpler and more intuitive to manage. “The hardest part is determining the starting prices. ![]()
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