A change in pricing is just the ticket
This week, Antti Korhonen tells why dynamic pricing could revolutionise event ticketing.
When you book hotels, airline or train tickets nowadays, most services use dynamic pricing. This helps predict daily demand and forces customers to make their buying decisions earlier. Dynamic pricing itself creates value for the selling process, because it offers customers saving opportunities: the sooner you buy, the cheaper you will get it.
However, some business owners might not want to use this pricing model because they feel it ruins their revenue possibilities.
Say you were organising an event and it has not sold out. Why wouldn’t you consider selling the unsold tickets at a lower price? The revenue model should be seen in a way that the organiser wants to sell all tickets at the best price possible. This is always the price that some consumers are ready to pay before others. Yes, you read that right.
We should build a ticketing pricing model in a way that makes some consumers willing to make buying decisions earlier than others. By using this method, business owners will start making money earlier than in a situation where all tickets are sold at the same price during the whole timeline. If there are no incentives for buying something in advance, why would anybody do it? The organiser can control the quotas and can sell the first ticket for one euro and the five following ones for two euros, for example. A clever organiser sees the model in a way that the start will be explosive and after that the tickets still remain interesting for consumers.
The change in pricing models in the event industry is already happening, but one could say too slowly, especially in Europe. The sooner the event industry realises the possibilities this brings, the sooner it will help more event organisers to do better business with their events. An early-bird ticketing tool is a good start, but we will need more robust tools at a platform, algorithmic and mindset level to make a bigger impact. Pricing models should live their own lives by using all the consumer data available to gamify the selling process.
Why couldn’t prices change unpredictably? Why do we check out airline tickets from various services simultaneously and try to find the best price possible? Organisers need to create the same kind of incentives in the event ticket market. Without dynamic pricing, consumers control the situation because they have the privilege to decide if they are interested enough to buy tickets in advance. This is what needs to be changed.
Let’s change the stance together and make events insanely interesting in advance with bold pricing models that allow event organisers to control the situation.