author SOR, Published in the newsletter of Culture - Management - Policy, Raabe Verlag, August 2010 The dynamic pricing, a business model from the field revenue management enjoys in U.S. cultural institutions in the area of stage increasing popularity. The model has been for decades known in aviation, but can also apply on culture. They advertise the lowest price "from x dollars," this is only for "early bird" and is available for the less popular programs and unpopular places. Should there be a more popular program, another day, a better place to be on it paid.
The formulas for pricing, more complicated - Price Change = (demand-supply quantity) / price adjustment factor - or be very simple. If the average utilization at 70% could be increased from 65% utilization rates by $ 5 for another $ 5 on reaching the loading of 70%, 75% and so further. If the average price at $ 10 more, the price increase amounted to just $ 1.
Some theaters have tried the dynamic pricing despite concerns and have been surprised by how taken for granted the customer the price adjustment. In all known cases, this has resulted in a significant increase in the average price and thus greater revenue out.
The principle to raise prices when demand exceeds supply, can be transferred to the museum area. Visitors to the museum often move to the last weekend of a special exhibition. Why prices could not be increased on these days? Would be consistent dynamic It also orient the prices down, such as weekday or evening hours with fewer visitors.
The key to the success of dynamic pricing is the thorough preparation, the collaboration between IT, marketing and sales, excellent customer service and knowledgeable employees.
