Pricing is of decisive importance for all businesses in all sectors; setting prices right often makes the difference between success and complete failure. Finding the optimal prices is the easiest and most effective way for any businesses to increase profits.
This universal truth then forces us to ask the question; how do we manage prices during unprecedented variability in demand? Two considerations should be factored into answering that question. Firstly, not every demand problem can be solved with pricing. For example, offering concert tickets for free right now will not fill big-city arenas. Secondly, relying on old price-sensitivity research is not a good idea. In a dynamic and evolving market, market price tests become obsolete after just a few weeks or days or even sooner. To understand changing price points, companies should run new pricing-sensitivity research and market price tests immediately or invest in technology that can complete that workflow autonomously to always have actionable and relevant price sensitivity information.
An equally important question that is fundamentally overlooked is how hotels and hostels will reopen? It depends, of course largely on a variety of factors seemingly out of our control. Regardless, the world is not going to be the same as used to be before the pandemic, at least not any time soon. What preventive measures will large communal activities have to take to be allowed to reopen? Will they have to operate at a reduced capacity? For how long? Will their customers go back? How soon?
In these daunting times of uncertainties and unknowns, demand for hotels and hostels is practically impossible to predict. Those trying to continue using manual and fixed pricing to respond to the unpredictability and the unprecedented variability in demand are accepting a huge risk of failure.
Pricepoints occupancy & demand forecasts and dynamic pricing offer resilience, versatility, and competitive leverage to our customers. By ensuring the highest quality of calculations using advanced statistical methodologies to analyze the multitude of possible scenarios and conclude with the most probable vision of the future.
Understanding that those hit the hardest by the outbreak may not have resources to innovate right now, we recently announced a special COVID help package which includes a discount from our normal price, if you’re still not sure, give us a try for 30 days free with no obligation.
For our offers or to get in touch, do not hesitate to contact us at [email protected]
Wyatt Niblett Wilson, Marketing Coordinator