In my last article I explained how to best manage credit card transaction costs. Interestingly I had a lot of feedback and questions about my suggestion to shake up the way tourism operators approach pricing their products.
To me, you should not compete on price alone. Pricing is not simply about setting your rates. You should think of it as shaping demand, communicating value while optimising revenue, and being assertively competitive in a travel market that is driven by flexibility and choice.
Accommodation providers, activity/experience operators should examine and draw from pricing strategies that are employed in other categories. The best examples are irregular pricing and demand-based pricing used in retail. These are simple and practical tools that are value focussed and unlock higher yields and create better guest experiences.
Irregular pricing refers to intentionally varying prices based on the day of the week, or season and for activities even the time of day. Unlike traditional peak/off-peak models, irregular pricing can be more granular, charging premium rates for Friday or Saturday nights, offering midweek discounts, tour start times that have less demand or setting promotional pricing for long weekends and school holidays.
This approach works particularly well for experiences and short-stay accommodation, allowing operators to stimulate demand during quiet periods, encourage advance bookings with early-bird rates and provide locals or midweek visitors with added incentives.
A campground offering discounted midweek rates or a walking tour that’s cheaper on Monday mornings are examples of the use of irregular pricing to smooth demand and increase overall occupancy or ticket sales.
Demand-based pricing, also called dynamic pricing, is a strategy where prices fluctuate in response to real-time factors such as booking patterns, competitor pricing, seasonality, and special events.
Think of a wildlife cruise raising prices in line with a local festival weekend, or a glamping provider adjusting rates based on lead time and remaining availability. This is traditionally used by airlines and large hotels, but now demand-based pricing is accessible to smaller operators thanks to booking systems and distribution platforms like Tourism Exchange Australia (TXA).
The simple tactic of setting odd and surprising numbers implies that you have painstakingly squeezed your rates to as low as they can go. I challenge you to try it as a test. It’s one way to recover those little costs, like card transaction fees, and stay competitive across OTAs and direct channels. For example, rather than setting your rates with an ‘even’ format ($XX0, or $x50) try using $XX3 or $X57.50. This suggests that you are taking the trouble to diligently price everything at its minimum.
You don’t need complex software or data science expertise.
Destination organisations (DMOs) and local visitor centres also have a role to play in their marketing activity. Coordinated campaigns like “Stay Longer, Save More” or “Midweek Adventures” or similar value-oriented offers can unify operators in a destination with a consistent pricing theme, helping drive broader regional impact and showcasing local value.
