During dynamic pricing, a ticket engine changes the ticket price at specific intervals based on the specified settings as demand and supply change. In the case of dynamic pricing, it is important to precisely set the related parameters to ensure that the pricing engine achieves the desired goal.
Dynamic pricing parameters
The following parameters are only involved in determining the ticket price, so they do not stop or start selling ticket types. For this purpose, the settings found in normal pricing should continue to be used.
Expected quantitiy sold
Quantity of the expected ticket sales in the chosen ticket category. It’s important to give a realistic number, not a best or worst case scenario. For example, it is realistic that all the early-bird tickets will be sold, while not all the late-bird tickets.
Expected sales start
Date when this ticket category is expected to start being sold (between the start of sales and start of the event). For example, the early-bird tickets start to be sold when the ticket sales start, while the late bird tickets start to be sold when the early-bird or normal ones are sold out only some days or weeks before the event date.
Expected sales end
Date when this ticket category is expected to stop being sold (between the start of sales and the start of the event). For example, early-bird tickets are planned to stop being sold after 100 sold tickets that takes approximately 3 days after the start of sales. For the late-bird category, this date can be the same as the event date or an earlier date if tickets are realistically expected to sell-out early.
The lowest price of the chosen ticket category that the pricing algorithm can offer to the interested webpage visitors / potential buyers. This price will not necessarily be offered, only if the demand is low.
The highest price of the chosen ticket category that the pricing algorithm can offer to the interested webpage visitors / potential buyers. This price will not necessarily be offered, only if the demand is high enough.
Initial price is the price at which the tickets of the chosen category will be offered in the very first moment of the sales period. This can be the same as your fixed price before starting to use the dynamic pricing engine, but it also can be different. It must fall between the minimum and maximum price of the chosen ticket category.
Example of a pricing strategy
The sales strategy can be many and varied, we present one below to maximize revenue. In the example, earlier the organizer priced his tickets in the traditional way like this:
|Early Bird||10 €|
|Normal I.||15 €|
|Normal II.||20 €|
|Normal III.||25 €|
A dynamic method for dynamic pricing is to set their prices as the minimum price and starting price, while keeping the previous ticket types, and the maximum price is the amount below the price of the next type:
|Ticket price||Minimum price||Maximum price||Initial price|
|Early Bird||10 €||14.90 €||10 €|
|Normal I.||15 €||19.90 €||15 €|
|Normal II.||20 €||24.90 €||20 €|
|Normal III.||25 €||29.90 €||25 €|
Thus, in case of high demand, the price will go higher, but will certainly be lower than the price of the next category. In the worst case, demand will remain low, in which case the organizer will have exactly the same amount of revenue and number of tickets sold as if it had been sold with traditional pricing.