How Aggressively Should I Push Up Rates When There’s a Big Local Event?

Seasonal pricing is a broad-brush approach based on general travel trends, such as beach demand in the summer or ski demand in the winter. Event-based pricing, by contrast, is surgical. It focuses on a highly concentrated spike in demand that often lasts only a few days. Therefore, price sensitivity drops significantly because guests are traveling for a non-negotiable reason.

While seasonal pricing might see a 20% to 30% increase, a major event can justify increases of 100%, 200%, or even more. Revenue managers must treat these dates as distinct entities on the calendar, separate from the surrounding weeks, and apply specific rules that reflect the scarcity of available housing in the immediate vicinity of the venue.

To determine how aggressively to price, you must first understand the "demand lift." This is the percentage of additional demand an event generates compared to a standard weekend. You can assess this by looking at historical occupancy and ADR trends for those specific dates in previous years.

If the market historically reaches 95% occupancy during a festival weekend, you have high pricing power. If the occupancy only nudges up to 75%, you should be more conservative. Tools like Wheelhouse can help you visualize these historical spikes and compare your property's performance against the broader market to ensure your starting point is grounded in reality rather than guesswork.

There is a psychological temptation to set an astronomical price the moment an event is announced. However, pricing too high too early can backfire. Early-bird bookers are often the most organized and price-sensitive planners. If your rate is triple the market average a year out, you may see zero activity, which deprives you of the data you need to gauge current demand.

Furthermore, if you do manage to snag a booking at an extreme premium very early, you face a higher risk of "placeholder" bookings. These guests secure your property while they continue to shop for better deals. If they find a more reasonably priced alternative two weeks before the event, they may cancel, leaving you with high-priced inventory that is now difficult to sell as the event nears.

Pacing data is your most valuable indicator for event pricing. It measures the speed at which you are getting booked compared to the market. For example, if you are pacing 50% above the market for a major event that is 6 months away, you are pacing too fast. This is a clear signal that the market is willing to pay more than you are currently asking.

When you see a rapid acceleration in bookings—often coinciding with ticket releases or lineup announcements—that is your cue to nudge rates upward. An aggressive strategy involves raising rates in increments as your occupancy increases, effectively "yield managing" the remaining nights to capture the highest possible price from last-minute, desperate travelers.

For a major event, your nightly rate is only half of the equation; your minimum stay requirement is the other. If a festival runs from Thursday to Sunday, but you allow a guest to book only the Friday night, you may be left with a Thursday and Saturday night that are impossible to sell individually.

Aggressive revenue management means setting a minimum stay that covers the entire duration of the event. This ensures that you maximize the "Total Stay Value" rather than just the nightly rate. By requiring a 3-4 night stay, you filter for guests who are fully committed to the event and reduce the operational costs associated with multiple one-night turnovers during a high-traffic period.

In revenue management, the goal is often to be one of the last properties to book. The logic is simple: as the event date approaches and the total supply of available rentals in the city shrinks, the remaining guests become less price-sensitive. They need a place to stay, and they will pay a significant premium for the last few units on the market.

If you book your event dates months in advance, you have likely underpriced the peak demand. A more aggressive and profitable approach is to "hold the line" on high rates. While it can be nerve-wracking to see an unbooked calendar 30 days before a major event, the data often shows that the highest-margin bookings occur in that final month when supply is at its lowest.

High-event rates come with high stakes. To protect your revenue, your cancellation policy must be as aggressive as your pricing. For major event dates, consider shifting from a "moderate" policy to a "strict" or even "non-refundable" model.

This prevents guests from using your property as a safety net while they look for cheaper options. You can also offer a small discount (e.g., 5-10%) for non-refundable bookings. This provides the guest with a perceived "deal" while giving you the peace of mind that the revenue is locked in, regardless of whether the guest chooses to attend the event or not.

"Anchor pricing" is a behavioral economics tactic where you set an intentionally high price to establish the value of your property. Even if that specific price doesn't result in an immediate booking, it tells potential guests that your home is a premium, high-demand option.

When guests see a property priced at $1,000 a night during a festival, a "discounted" rate of $800 feels like a bargain, even if the standard rate for that property is only $300. By starting your event pricing high, you give yourself the room to "soften" the price later without ever dipping below a highly profitable threshold.

While the goal is to be the last to book, you must also be realistic. If you are 14 days out from a major event and you still have no bookings while your competitors are 90% full, your price is likely beyond the market's "breaking point."

At this stage, a slight "softening" of the rate is more effective than a massive slash. Instead of dropping the price by 50%, try lowering the minimum stay requirement first. If that doesn't trigger a booking within 48 hours, then begin a gradual price decay. The key is to remain the most attractive of the "premium" options left, rather than racing to the bottom with budget listings.