Managing Director, Dan Eastmond, Firestation Arts Centre discusses their experimentation with dynamic pricing and the subsequent results.
Dan Eastmond states: “Over a 12 month period we decided to undertake a pricing project utilising 3 pricing models.”
“We used rising prices, moving prices and what we call price crash.”
“Rising prices is simply starting the cost of a ticket at a reduced rate and then gradually increasing the price over time as the event gets nearer.”
“Moving prices consisted of ‘moving’ the price of a ticket depending on a number of variables such as time and demand. We used a mechanism which would inform us when demand was hot and therefore we knew we could increase the price slightly or alternatively the demand may have dropped and therefore we were able to drop the price.”
“Finally, ‘price crash’ as we call it, was aimed at understanding the power and effect of social media driving sales. Through our social media platforms we would announce a major discount and see the impact social media had on driving customers to Firestation Arts Centre.”
“All 3 models have advantages and disadvantages, but for us dynamic pricing is so flexible and innovative and I think the customers are actually very accepting of it. But, for us one of the most important aspects of dynamic pricing is transparency with our customers – that is so important.”
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