Pricing your tourism products or services is not an easy task, and often pricing mistakes in the tourism industry can result (i.e. Pricing too low or too high)
Watch this video below to find out the problem that I see all the time with hotels, tours, transport companies, attractions, event owners and operators
Do tourism brands need to resort to price discounting their products and services or matching their competitor’s price points on a regular basis?
It doesn’t have to be that way.
Setting prices for tourism services can feel uncomfortable. And sometimes our own personal beliefs about money can impact whether we set prices emotionally or set prices objectively.
Some tourism businesses believe that low prices are the only thing that guests seem to care about or pricing lower than your competition is the only way to bring guests in the door.
This is not true.
Maybe these businesses haven’t given guests anything else to think about other than their price.
Pricing is all about perception. It requires looking at your ideal guests and several factors beyond what your competition is doing.
In fact, you'd be surprised to know that if you price the same as your competitor but you seem a bit better than them (in your marketing, and in their overall first impression) often this leaves an impression in their minds whether you are a trustworthy brand and these potential guests wonder what they are missiing. Again pricing is a perception - and in this case you just left money on the table
To avoid pricing mistakes look at all factors when setting a pricing strategy.
Are you setting your price emotionally (based on your view of money) or objectively by looking at all the quantitative factors? Factors such as:
- Your fixed and variable costs?
- Your sales and profit goals?
- Your commissions from all of your partners and OTA's (even your transport commissions)
- Seasonality for high and how season and the rates your OTA's change on their websites to account for the seasons.
- The demand for your product or service
- Your competitors pricing strategies (not to meet it, but to understand it)
- What is your guest is willing to pay?
- It also includes the value you can put into your offering that your guests see as important (of value) to them.
As you can see there is alot that goes into pricing that needs to be thought through and considered instead of matching or dropping your price.
So are you looking at all the pricing factors in your business instead of just dropping price?
If this problem resonates with you, we have a community of tourism business owners, operators, and managers that want to discuss and solve tourism marketing problems like this and many more.
We would love you to join us by using this link here.
Here are more common problems in the tourism industry that might be affecting your business.
The causes of a wasted advertising budget
For more tourism marketing resources click here