Easy & effective pricing tactics for activity and rental operators

Ever wondered why at the movie theatre you’re likely to opt for a Large Popcorn instead of a Small or Medium? (Aside from the buttery goodness, of course.) Or, why at the grocery store you naturally reach for a product with a price that ends in $.99? The answer: pricing tactics.

Let’s take the movie theatre as an example. When you’re at the concession stand, you see a small popcorn costs $4.50; a medium is $6.50; and a large is $7.00. You don’t really feel the need to get a large popcorn, but you see it’s only $0.50 more than the medium, so you choose to buy it because you feel you’re getting a better deal. That shift in buying behavior is thanks to a pricing tactic called The Decoy Effect.

Pricing your products might seem like a simple task. But, the reality of any purchase is that customers are often using one part logic and one part emotion. 

That’s where pricing tactics come in. By understanding your customer and what emotion(s) they experience in their buying journey, you can choose pricing tactics that match. 

No matter if you’re selling, you can use pricing strategies and tactics to increase your business’s revenue.

What is a pricing strategy?

First, let’s clarify what a pricing strategy isn’t. It’s not simply adding a markup to the base cost of your experience (although that’s still important to do!) It is, however, your approach to positioning your products in the market. To do this successfully, you should have a good understanding of your customers, industry, competitors, and demand. 

Let’s say you run a luxury Nordic spa. Some basic factors you might want to consider in your pricing strategy would be:

• Knowing that your potential customers value high-end experiences,
• The spectrum of pricing in the wellness/spa industry in detail – from public pool spa facilities to hotel spa packages,
• What the competitive landscape is and what other Nordic spas are charging,
• Current health & wellness trends – are customers actively searching online for experiences like yours?

With a clearer picture painted, your spa can now choose the pricing tactics you’d like to put in place. 

Let’s dig deeper into some pricing tactics examples. We’ll explore why they’re great for activity or rental operators and share how you can start using them today with Checkfront’s online booking software.

4 easy & effective pricing tactic examples

Effective and easy to implement, pricing tactics for activities and rentals can successfully communicate your brand, help you stand out from your competitors, and increase your revenue. 

There are as many pricing tactics out there as there are Ben & Jerry’s ice cream flavours (that’s to say, a lot). But, after 13 years in the booking software industry, we’ve seen our activity and rental operators see success with these four pricing tactics.

1. Charm pricing and rounded pricing
2. Seasonal pricing
3. Public & private pricing
4. Duration-based pricing

Charm pricing and rounded pricing

Charm pricing and rounded pricing can be used together or exclusively. Depending on your product, the type of customers you’re looking to attract, and your marketing goals you can use what’s best for your business.

Charm pricing examples generally include pricing a product slightly below a whole number, like $9.99 instead of $10. By dropping the price by one cent, the customer associates the cost closer to $9 than $10 and creates the impression of a bargain.

Rounded pricing, on the other hand, involves pricing a product at a whole number – often ending in 0 or 5. This can create the impression of quality and exclusivity. 

Rounded Pricing Example 

Let’s use our Nordic Spa as our business. They choose a premium pricing strategy and then put rounded pricing in place to communicate that their product is a high-end experience. Every product they list ends in a whole number before tax is applied.

• Spa Circuit | Half-Day Spa Pass: $150
• Spa Circuit | 2.5 Hour Pass: $70
• Bachelorette Group Spa Circuit (3hrs for 8ppl) | $900
  • +Bottle of Champagne Add-on $80

How to set it up in Checkfront

We’ll use the Half-Day Spa Pass to show how quick it is to set up rounded pricing in Checkfront.

First, select Inventory > Products > +Add New to create your “Half Day Spa Pass” Product. Following filling out your product details and adding photos, assigning your resources – your Circuit Spa, and setting your half-day availability we can set our pricing.

Since this product is bookable by 4-hour timeslot, under Rate Type we select “Per Timeslot”. We’ve set our guest type to “Adult” and then we simply input “$150.00” as our Guest Rate per adult. 

Seasonal Pricing

Any activity or rental operator that relies on the great outdoors is already familiar with seasonal pricing as a tactic. This means charging higher prices during peak seasons when demand is high and lower prices during off-peak seasons when demand is quiet. Not only does it allow operators to optimize their revenue and profitability throughout the year, but it can also help better maximize their resources.

With Checkfront, it’s easier than ever to set your base seasonal pricing once and let it take effect as soon as the leaves change colour. No need to set calendar reminders and manually update your website! But, why stop at summer or winter pricing? Holidays are a great opportunity to capture short-term increased demand. 

Seasonal Pricing Example

A driving range in Arizona sets summer, spring, fall, and winter pricing to reflect the popularity and demand of each season. But, since they know their customer base, they know that Father’s Day typically sees a spike in bookings. So, to capture this increased revenue potential, they create a specific product that only appears in the 2 weeks leading up to Father’s Day.

• Swing with Dad | $95
  • 2 guests
  • Two 2-hour driving range bays
  • +Additional upsell: Gift Wrapped Set of Golf Balls

How to set it up in Checkfront

First, select Inventory > Products > +Add New to create your “Swing with Dad” Product. Following filling out your product details and adding photos, assigning your resources – your driving range bays, and setting your 2-hour timeslot availability with a guest minimum of 2, we can set our pricing.

Since this product is bookable by 2-hour timeslot, under Rate Type we select “Per Timeslot”. Then, under Guest Rate we set our guest minimum and maximum to 2, simply put “$95.00” as our price, and select “Per Group.”

Public & Private Pricing

As an activity business owner, maximizing the revenue potential of your business is a no-brainer. After all, your resources – like axe throwing bays, escape rooms, or paintball courses only make you money when they’re booked. One way to get them booked to capacity faster is by offering both public and private pricing.

Thankfully with Checkfront, it’s lightning-fast and easy to sell one product in two ways with both a public and private version.

Private Pricing Tactic Example

An axe-throwing business in Vancouver is busy on weekends with smaller group bookings for their individual bays. But, they’re trying to find ways to drive more bookings and revenue on weeknight evenings. So, they decide to create a private booking option tailored for team-building events. This way, they can offer group pricing that allows the customer to book multiple bays at one time.

• Tossin’ Axes Team Building | $1,000
  • 4 bays w/ 5 person capacity per bay
  • 2.5 hour timeslot

How to set it up in Checkfront 

First, select Inventory > Products > +Add New to create your “Tossin Axes | Team Building 2.5Hrs” Product. Following filling out your product details and adding photos, assigning your resources – your axe throwing bays by capacity, then setting your 2.5-hour timeslot availability with a guest minimum of 5 and maximum of 20, we can set our pricing.

Since this product is a group-based booking, under Base Rate we select “Guest(s) Rate”. We then select a minimum of 5 and a maximum of 20 guests, set a price of $1,000.00 and click the drop down menu to choose “Per Group”

Duration-based pricing

A lot of work goes into getting a booking. From your marketing efforts to your booking flow, getting a customer to the point of checking out is no small feat. 

So, once you’ve got them interested in your experience, why not give them an enticing reason to book longer?

Duration-based pricing is a tactic that charges customers based on the length of time they rent equipment or book an activity. Discounting your per-day or per-hour rate can give you an edge over other rental businesses, and encourages more revenue. 

Duration Pricing Tactic Example

As a watersport rental company, you rent out stand-up paddle boards, single and double kayaks, surfboards, and skimboards. Being based in Hawaii, you get a lot of bookings from couples on their honeymoon. So, to benefit from their extended vacation time, you add a 5% discount for rentals lasting 2-4 days, and an additional 10% discount for rentals lasting 5-7 days.

• Daily Double Kayak Rental – $50
  • 2-4 day rental – 5% discount
  • 5-7 day rental – 10% discount

How to set it up in Checkfront 

For this example, let’s set up a Double Kayak that could be booked by a newly married couple.

First, select Inventory > Products > +Add New to create a “Daily Double Kayak Rental” Product. After filling out product details, uploading photos, adding your quantity of resources (double kayaks), and choosing “All Day” availability we can set pricing.

Then, move to Pricing, and under Base Rate select Per Day and add set a $50.00 rate for Double Kayaks. Then, to add duration-based pricing discount we select Add Rate and then choose Duration. Now, we customize the name of the duration rate, select the date range it applies to, and choose 7 days as the total number of days for the discount. 

We select a 5% discount for a rental lasting 2-4 days and to entice a week-long booking, we increase the discount to 10% for 5-7 days.

Final Thoughts

It’s clear that a lot of factors go into setting pricing for your activities and rentals. Our suggestion? Make a bowl of popcorn and set some time aside to build your pricing strategy by mapping out your customers, industry, competitors, and demand. Then, choose from these or a variety of other pricing tactics that fit best for your business. The result? Your business is more effective at capturing even more bookings.

With the help of Checkfront’s online booking software, setting up and adjusting your pricing tactics is effortless, Meaning you can focus more time on delivering exceptional experiences to your customers.