Theme parks consider dynamic admission pricing

People are strange... <starts humming the Doors song>

We've seen some variation on this for years in amusement parks. Kennywood, for example, was always cheaper during the week than on the weekends. At Cedar Point, for the past few years their "standard" early season discount was not valid on Saturdays, and gave you a bigger discount in May than in June.

The problem comes with making the pricing truly dynamic, given the admission models used. Parks are trying their darnedest to get as many people as possible to buy their tickets in advance, either on-line or through off-site ticket resellers. For those people they are typically selling "good any day" tickets, which don't lend themselves well to repricing.

Or perhaps that's the entry point: if you want a fixed price for your ticket, buy it in advance. When you get to the gate, your ticket may be much cheaper or much more expensive, depending on the time of day, the weather, and the number of people who came to visit.

I think truly dynamic pricing is going to be much more useful on things other than park admission. Jeff already talked about how Disney discounts their meal plans and hotel rooms rather than their admission tickets. I've noticed that at Kings Island there are certain upcharge attractions whose prices change on a daily basis (a Skycoaster flight can cost anywhere from $5 to $40 per person!). I also think that with better data analysis capabilities we may see parks do more price tweaks during the season. Again, this season at Kings Island you could get an all-day drink wristband for anywhere from $5 to $8 depending on when you visited.

--Dave Althoff, Jr.

But couldn't you simply change from a 'good any day' model to a 'good for a specific day' model? That is to say asking for the date of your visit is part of the purchasing process (don't some parks do this already for other purposes?) and the appropriate price is spit back at you based on the dynamic model.

It depends how dynamic we are talking. With hotels for example, the price can change with each room booked. But I presume that the online price could be that dynamic as well. Can you imagine if the price of a ticket would change that much? Johnny could have bought his ticket early and paid $65.00, Susie was the first person in line and bought her ticket for $80 that day, but Bobby paid $90 because he bought his an hour after the park opened and attendance projection increased! That could lead to some unhappy people that paid more for their ticket and spent longer amounts of time in line rather than riding!

It is more reasonable to have a slightly less dynamic approach though where the price is set at the beginning of the season or a month (or two weeks even) in advance.

But like you said, we accept it for hotels. And it's how the airline industry works. There is precedent.

The whole key is that you don't really know how much the people in line behind you paid. The only dissatisfaction could come from seeing a lower price online later, but that also applies to things like the travel industry and they do just fine. On the flip side, how many people are happy because they play the game and end up getting a ticket for a lower price than they first saw. People love getting what they feel is a deal.

You may have hit on something there. What if it is presented as a discounted rate instead of a dynamic rate? Same principle applies, just that the maximum price is considered retail value and everything less than that could be presented as a discounted rate. Then people would really feel like they are getting a deal.

Yea. I see the way things are done now as the same thing as a dynamic rate, except you don't have to haggle for a better price. Gonch, you have even said yourself in other threads that people get into the gate at different prices right now anyways. some people pay full price at the gate, some people show a coupon at the gate, some people buy tickets at a discount online, and some people buy a package deal, some people get discounted tickets from grocery stores, AAA, and other places.

I kind of like the idea of offering a discount during the slower times, because that way everyone thinks that they are smart for getting a great deal.

Or not. I don't care. Whatever. :)

I think to Gonch's point, a single-day visit to an amusement park is probably not a spontaneous decision. Not saying it never is, but particularly for week day visits, there is generally a plan. This is the case for flying and hotel stays as well. I already plan to visit theme parks when I see the best deals in terms of room rates, and would likely do the same for admission (though as stated, Disney rarely, if ever, discounts admission).

But people do like to have some flexibility. For example, back in the Dark Ages, we would get our single-day Cedar Point tickets in advance of a planned trip. On at least one occasion we had planned a two-day trip...one day at Cedar Point and one day doing other North Coast Vacationland stuff. When we got up there, it was pouring down rain and not looking like it was going to get any better. Easy decision for us: we flopped our travel plans.
No, the trip wasn't a spontaneous decision. But our park visit plans were flexible. In the context of a multi-day vacation, plans are often flexible. I don't see parks making that any more difficult or complicated.
I do think they could compromise, though. They could offer their best discounts on specific-day tickets. Some parks already do something like that, charging a surcharge if a pre-season ticket is used later in the season. Sure, you can use yesterday's ticket today, it will just cost you a few bucks. Not enough to make you ask for a refund, but enough to keep you from making it a habit...

--Dave Althoff, Jr.

My thoughts exactly, Dave.

The fineprint reads that a surcharge (read: the difference in price) may be required to use the dated ticket on an alternative date.

I think the big problem, and Dave hit on it, is that many regional parks are typically day trips that are heavily dependent on weather. Not that they're totally spontaneous either, but I know growing up my family always had one or two "rain dates" planned in advance of our annual CP trip, in case the forecast for our initial date wasn't favorable. I don't know how many people you'd turn away if you forced them to lock into a particular day in advance, but I have to assume it would be more than a few.

On the other hand, something I have noticed at Cedar Point in the past couple of years is the attendance bounce they have been getting on the Sunday of Columbus Day weekend. Some of that is spontaneous visits, too...people who made the mistake of visiting on the busiest day of the late season who then decided to take advantage of that "come back for a second day" offer to salvage the weekend from ridiculous crowds on that Saturday...

So what impact would dynamic gate pricing have on their present crowd mitigation strategies? We don't see it as much at the Cedar Fair parks, but at the big Florida parks, expected crowd levels are compensated for by adjusting the hours. Right now it is effectively a lot more expensive to go to a WDW park in the shoulder season than in the peak season. Either way your ticket costs nearly $100 but in the peak season the park is open 8am-Midnight ($6.25/hour). In the shoulder season you get 10am-6pm ($12.50/hour) if you are lucky...and even as you pay more for a park with shorter lines, the park also features fewer operating attractions, and in extreme cases the day is so short there isn't time to do as much as you can do on a longer day with longer waits!

--Dave Althoff, Jr.

CP Chris said:

I think the big problem, and Dave hit on it, is that many regional parks are typically day trips that are heavily dependent on weather. I don't know how many people you'd turn away if you forced them to lock into a particular day in advance, but I have to assume it would be more than a few.

Then why wouldn't those people just be buying tickets "day of" instead of "in advance"?

My guess would be that the more spontaneous (or at the very least, the less locked-in) wouldn't be likely to buy tickets in advance anyway.

I mean isn't that the decision process at this point? To commit to buying tickets in advance or waiting to buy until you're ready to go or at the gate or whatnot.

I don't think the process needs to be quite as complicated as you're suggesting.

It kind of depends on the mindset of the consumer, I guess. And it doesn't hurt that the parks are already providing huge incentives to people to buy tickets in advance, particularly through brokers (travel agencies, grocery stores, etc). As parks shift to more on-line sales they are actually having to tread carefully to keep from alienating their traditional discounters.

My point is that there are a fair number of people who know that they will be going to the park, and even know that they are planning to visit the park within a fairly narrow window of dates. They know that sometime during their big vacation trip to Des Moines, they will be visiting Adventureland (for instance). That gives them a week-long window, and they'll go on the day that makes the most sense. The final decision may not be made until the morning of the visit. But the decision to make the visit, and even the week in which the visit would take place, was made months in advance.

Again, I think the easiest way to manage this is to go with coarser resolution on the price tweaks. Cedar Point's Pepsi^H^H^H^H^HCoke can discount is already something like $20 off in May, $10 off in June, not valid on Saturday.

--Dave Althoff, Jr.

(Hey, Jeff, is there a strike-out text style tag in POP Code? :) )

On the changing habits of ticket purchasing, I think the redesign of Cedar Point's front gate is telling. The masses coming in from the parking lot will not get "stuck" behind the ticket booths, and those with tickets will be able to just walk right up to the turnstiles. It's like the actual ticket booths are a secondary concern, on the side, in case you need to pick them up or haven't already bought them.

To determine the price of a parking block, San Francisco adjusted the price until they achieved an 80% occupancy rate. In some cases they raised the price, in some they lowered it. Maybe some one already mentioned it but Cedar Fair priced Fastlane using the same methodology. I don't see parks going truly dynamic in the way hotels or airlines do it myself.

Re: ticket habits

We seem to be working on the assumption that the system is the way it is because that's how people buy tickets and plan trips. The truth is probably exactly the opposite - people buy tickets and plan trips the way they do because of how the parks price and sell tickets.

The idea that the customer base won't adapt is a little crazy. We all seemed to adjust to the idea of buying online and purchasing tickets in advance. It really wasn't all that long ago that not standing in a long line to buy a ticket at the park became a valid option.

Re: eightdotthree questioning the methodology

I think you're right. Initially or partially depending on how you look at it.

Makes sense to just use crowd patterns to create a yearly calendar with the appropriate pricing to keep the park sufficiently full and/or sufficiently profitable.

But I would like to think at some point (be it at first or 10 years from now) it becomes a little more "on the fly" in regards to the dynamics. That is to say beyond the big picture set schedule, that anomolies result in adjusting on the fly to varying degrees. It could be that advance sales for two Thursdays from now are far lower than expected so we drop the price or it could be that a freak weather pattern is bringing unexepected rain tomorrow morning so lets drop the price to encourage more people to take a chance and come out.

Depends on how much you want to micromanage for maximum efficiency.

Yeah fastlane is $60 on a weekend in December at Knotts, but $50 during the week.

I like the idea.I am bargain shopper.

Universal got me a few years back with

buy one year annual pass get one year free

and keep me with major discount on renewal

(159.00 to renew 259.00 for new)

If Disney would give me an admission discount to go on not busy days

I would go in a heartbeat.Room discounts onsite do

not matter to me I found a good offsite hotel

in the 29-49 range.I drive to the park so being near or onsite

doesn't save me anything.If the floor is the current price and it just goes up

on busy days I would not go .Offer me 2 days for the price of 1 (mid week during slow season)and I will be there or a Tues-Thurs annual pass for 1/2 the price of current Disney pass.blackout christmas week and 2 months in summer(currently 750.00 or so)

kevin38 said:If the floor is the current price and it just goes up

on busy days I would not go .Offer me 2 days for the price of 1 (mid week during slow season)and I will be there or a Tues-Thurs annual pass for 1/2 the price of current Disney pass.(currently 750.00 or so)

Are you talking the Premium AP or Premiere Passport, because a regular annual pass (no blockouts, just the 4 theme parks) is only a bit over $400 for a Florida resident, and I know they aren't giving residents a $300 discount. I would doubt they ever offer a seasonal AP to non-residents, though you can get a FL resident seasonal AP which is similar to what you described for even less than the "regular" AP.