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Dynamic pricing at ski resort helps sales slope up

Thomas Rechberger, project manager at St. Moritz Engadin Mountains in Switzerland, explains how the organisation is profiting from Smart Pricer’s dynamic pricing model for ski passes.

The Upper Engadin ski resorts introduced a dynamic pricing model for the 2018-19 winter season, which kicked off on September 1, 2018.

It works by varying the price for day and multi-day tickets according to demand on the respective validity date. In addition, the time of a booking affects the final price.

When asked why St. Mortiz switched to dynamic pricing, Rechberger said, in a video interview with CNN Money: “We listened to our customers. It’s about the needs and changing behaviours of our guests.”

Around 80 per cent of customers last year booked passes the day before or on the day that they want to ski, Rechberger explained. He added that now, with dynamic pricing in place, customers can shave 30 per cent off of their costs if they buy two weeks in advance. 

Rechberger said this has led to a 10 per cent increase in sales compared with the same period last year as there has been an uptick in people buying passes in advance.

Last year, Rechberger said a pass would cost 80 CHF (£64/€71/$82) all season. Through dynamic pricing, the cost now differs each day by looking at how many people have already bought passes for specific day and time of booking. Basically, the earlier a person buys, the lower the price will be, and in contrast, the more people on mountain for a specific day, the higher the price will be.

Image: CNN Money video screenshot