Home Cryptocurrency Blame Ticketmaster — but Disney, Cruise Lines Also Use Dynamic Pricing

Blame Ticketmaster — but Disney, Cruise Lines Also Use Dynamic Pricing

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Blame Ticketmaster — but Disney, Cruise Lines Also Use Dynamic Pricing

Pricing usually reflects supply and demand. Prices tend to increase when there are fewer goods, experiences, or services than are needed to meet demand.

This is a reality that almost every business is taking advantage of.walt disney (DIS) – Get The Walt Disney Company ReportFor example, during busy times of the year, such as school holidays and holidays, theme park entrance fees can be higher.

Royal Caribbean International (RCL) – Get the Royal Caribbean Group reportCarnival Cruise Line (CCL) – Get Carnival Corporation ReportNorwegian Cruise Line (NCLH) – Get Norwegian Cruise Line Holdings Ltd reportDoing the same thing in real time with Disney’s own cruise line.

Within its theme parks, Disney has a set of applicable fare ranges based on the time of year.That’s actually why the company thinks about customer experience, because if it uses Live Nation’s no-limit, no-cap system, it can get more (LYV) – Get Live Nation Entertainment Inc. Report Ticketmaster used to buy some tickets for Bruce Springsteen’s upcoming tour.

Ticketmaster has a reputation for being unfriendly to customers, and actually does what most Americans do when given the chance.

Dynamic pricing matches supply and demand

It’s easy to get mad at Ticketmaster, a company known for adding inexplicable fees to every ticket you buy. It’s also fair to be mad at Springsteen, who didn’t quite live up to his image of a working-class hero, getting every ticket he could.

The reality, however, is that Springsteen has established himself as a huge attraction, and his tour is drawing to a close. Any E-Street Band tour could be the last tour. So neither Ticketmaster nor The Boss need to think about pricing in a way that encourages return visits like Disney and cruise lines do.

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When a young band with decades of touring experience is pricing tickets, the next tour has to be considered. For traditional performances, the limited supply of tickets becomes more valuable because there may not actually be a next time.

Dynamic Pricing Sets True Value

When you sell your house, you usually sell it to the highest bidder. You might be thinking about how quickly a buyer can close or their chances of getting a mortgage, but when you sell your property, you want to maximize the amount you get.

Dynamic pricing may seem a little nefarious, but it’s really anyone or any business pricing anything in limited quantities.

This is also in your favor. Prices for hotels or cruise lines are (roughly) based on demand. You may need to travel within a certain window, but you will benefit if prices are low due to lack of demand.

Disney, Royal Caribbean, Carnival, Norway, and many others have left their money on the table because they don’t want to look like Ticketmaster and extract every penny from fans. They also want people to come back, so while the price will fluctuate up and down based on demand, it’s not completely dynamic, there’s no cap.

Dynamic pricing maximizes revenue. This is what businesses should do, while also considering long-term goals and customer experience.

When there is real scarcity (like Springsteen tickets in some markets), selling to the highest bidder is right for the company and arguably fair to the consumer.

No one is asking you to sell your house, your old collection, or anything else for a “fair” price, so why would a business do this? Supply and demand balanced with the needs of long-term customer relationships determine the price. This means that some people will be eliminated.

Not everyone can afford a Springsteen ticket, cruise or Disney trip. This may not sound good, but it’s an economic reality.

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