by Dr Jack Samuels
As a new approaches at many of the world’s parks and attractions, pricing decisions must be made. Frequently managers make such decisions based on costs rather than market realities.
If labour costs go up, the ticket price may have to increase. While costs should always be an underlying consideration, this can be a poor way to make such choices, especially if you raise the price too much or too little. What can be done to determine pricing? Here are a few suggestions:
•Look at the competition. When evaluating competition it is important not only to compare directly competing facilities (other parks) but also other leisure attractions in the market. This may include shopping malls, museums, cinemas, even sporting events.
•Survey your existing customer base. Complete pricing studies with your customer base to evaluate propensity to pay for the service offered, including season passes and auxiliary services such as food and merchandise. Special promotions should also be investigated.
There are many ways to vary pricing to maximise revenues. Factors affecting pricing will include demand, capacity of facilities, frequencies of customer visit and season pass use.
When pricing season passes, research must be done to determine the average number of visits to your facility per customer over the pass period. Other considerations might include whether the season pass should be offered to locals only or tourists, and whether the pass will damage the perceived value of the daily ticket.
The conventional wisdom is that a season pass should be offered for a full operational season or calendar year. This may be an incorrect assumption. What is perhaps is more important to consider how you can boost attendance over quieter periods and generate incremental revenues. “Periodic passes,” already in use at some facilities, can be used on all but the most busy days, with “blackout” dates for example over Christmas, New Year or other holiday periods.
Always collect data about the number of visits that are made at full price by non-pass holders during a given season pass period. Once that is collected you should usually sell your pass at that price or just slightly above it. Hopefully, you will arrive at a price that is attractive to the guest, but good for you as you would not otherwise have generated more gate receipts from that pass holder. While season pass holders will visit more often, these visits should result in incremental food , merchandise and midway game revenues.
You can also offer added extras such as priority ride access, but how about an option that includes inclusive food and beverage throughout the season? Most facilities offer just one or two options but, through research, the possibilities are endless as you strive to create loyal guests and guaranteed income, something which can’t be taken for granted in the current climate.
Dr Samuels has written numerous articles for the amusement, theme park and entertainment industries. He provides consulting services in marketing, facility development, customer service, safety, crowd and event management, plus promotional activities such as birthday parties.