Sabine Lehmann
Founder & Chair, CURIOSITAS @CityBowlKid
A smarter way to make SA visitor attractions more profitable

Dynamic pricing may sound like a new concept, but it has been around for some time—even in SA. Think of the Uber ride that changes in price depending on supply and demand or the airfares that are more affordable when booked in advance. But in some circles, there is a common misconception that dynamic pricing is all about squeezing every last cent out of customers.

In reality, it’s a win-win situation for both visitors and attractions. By adjusting prices based on demand, attractions can manage crowds better, ensuring a smoother experience for everyone. Shorter queues, less crowded attractions, and happier staff. Who doesn’t like a discount for planning ahead? This could be a real game changer for some SA attractions like Whether national parks, museums, theme parks and even adventure activity offerings.

I recently had a fascinating conversation about dynamic pricing with Håkon Lund, owner of Lund Gruppen Holding AS, one of the largest theme park and events companies in Scandinavia,and Chair of the global attractions association Europe, Middle East and Africa, IAAPA EMEA

Q: Not everyone understands the benefits of dynamic pricing. What is your take on it?

A: It is important to accept that all guests are not the same. You shouldn’t have one rule for everyone. For example, families with babies in strollers will have different priorities from those with older kids. What we are trying to do, is to give them a different kind of offering by differentiating the prices according to their needs. Customers appreciate it when their situation is acknowledged in a price adjustment.  

Q: How do you think customers see dynamic pricing?

A: Our experience was overwhelmingly positive. We had been using dynamic pricing for our music festivals for years, but it never occurred to us to use it for our theme parks. It wasn’t until COVID hit, and we had to limit capacity by law, that suddenly it all clicked, and we thought: “Why not do the same thing we do for festivals?” We have honestly never looked back. 

Q: Why do you think that is?

A: I think it is because every guest has different needs depending on their life stage. There is a tendency to group guests more broadly, but this may not necessarily work for the supplier or the customer. For us, it is all about the guest experience. In many instances, dynamic pricing is another way of describing what the hospitality industry has been calling add-ons, so: specific guest experiences. Most guests or tourists appreciate being allowed—and rewarded—for planning early. If they can get cheaper tickets, they value that.

Q: Could dynamic pricing be applied to all tourism-related situations?

A: No, for instance in weather-related cases it does not make sense to do this. If the weather is bad, no tourists may come anyway, so why reduce prices? Those who were going to come would do so anyway.

Q: Do you have tips for those thinking of implementing dynamic pricing?

A: Definitely. You need to be mindful of limited capacity. You need to change your approach from “unlimited, come whenever you want, and we’ll take as many guests as we can”, to “we have limited capacity, we have X amount of seats”, just as you would in a stadium or a music festival. Have different price levels, but if guests don’t want to come that day, they’re welcome to find another day. If the guest is set on a certain day and there are only 10% of tickets remaining, they’re going to pay a higher price. But they also know that the park won’t be overrun by people, making it better for staff as well the visitors. 

Considering the many advantages of dynamic pricing—why are South Africans so hesitant to try it out? For a start, getting good data to set those prices is often a challenge. Plus, South Africans are price-sensitive, so businesses have to find that sweet spot between being competitive and keeping things affordable. Recently there has been some negative press on dynamic pricing, particularly for sold out pop concerts, but this problem can be solved by putting in minimum and maximum guardrails such that the price never goes above or below an agreed rate.

On the upside: limiting capacity aligns with the principles of responsible tourism, and this can be a strategy for promoting sustainable tourism development—a big priority for especially nature reserves in South Africa. Ultimately though, dynamic pricing is about creating a better experience for visitors with financial benefits for suppliers. It’s time for South African attractions to learn from the example of Lund Gruppen Holdings—and start reaping the rewards.

Curiositas Tourism Futures
& Attractions Consultancy

SABINE LEHMANN
+27 (0)82 305 9019
sabine@curiositas.co.za

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