Why would you DROP rates during peak demand season? That’s a cardinal sin in the business world: If you lower your rates during peak demand, you lower your value and negatively impact the earning potential of both yours and all other venues around you.
What happens is:
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You drop your price to drum up new business
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You get more calls, but only from people who were attracted by your LOWER rate, which means they were never interested in booking your space at a reasonable rate, which means they are unreasonable people. (good leads who were on the fence about booking your space will often drop you at this point because they don’t know WHY you lowered your rate and they assume it’s because something is wrong with your venue)
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You are unable to book any of the new leads generated by lowering your prices because unreasonable people have unreasonable expectations
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Ultimately, you create more work and more frustration for yourself, with no additional revenue (or significantly lower revenue) as a result.
You will see an increase in damages, an increase in complaints, an increase in negative reviews, and a decrease in revenue.
Moving forward, your rule of thumb should be, NEVER lower your rates to generate leads, ESPECIALLY in peak demand periods. All you will do is frustrate yourself dealing with people who weren’t going to book your space anyway, and if they did, were going to be abusive and likely provide negative reviews.
It can be difficult to abstain from lowering your rates to try to undercut your competitors or generate more leads quickly, but if your rates work just fine during the regular season, lowering them during peak demand is only going to cause you problems. (if the don’t work at all during any season, you need to adjust them to market value)
If people don’t want to book your space for the same rates you’ve had posted all year, but they were more than willing to book your space at your regular rates during off-peak season, then logic says your regular rate was not the issue.
Alternative reasons can include:
SEASON - people simply take longer to commit to a venue during the holidays, especially when spending a lot of money…be patient
BUDGET FACTORS - People have other budget concerns and the price for your venue may be great, but they may not be able to get their favorite caterer to deliver to your location, or the AV company may offer a discount for booking at their partner location
LOCATION - you may simply not be in an ideal geographical location for holiday-specific events
LOCATION - Your venue may not be what people are looking to book for holiday-specific events
PRICING - If you’ve lowered your pricing during peak demand, you’ve signaled something is wrong with your venue, so people are looking elsewhere (just like lowering the rate for a house that’s been on the market for a while signals that something is wrong with the house)
It can be counter intuitive, but you have to remove your own personal bias from the equation. We know our venues like they’re our own children. Clients don’t know your venue from a pothole in the street and they are weighing all the factors for their event, not just how nice you are as a host and how affordable your space is.
Event planners typically have a fixed budget and a high client satisfaction expectation, so they will often pay much MORE for the right venue rather than try to save money.
Discount Clients who are trying to save money first and pay attention to the quality of the event second are the cheapskates who started with an inadequate budget and often exhibit the most entitled behavior. They think you should bend over backwards to earn the “fortune” they’ve spent on your place…while you think they should be immeasurably grateful for giving them a discount on your already-reasonably-priced venue. This is an expectations-disconnect you will NOT be able to reconcile. You DO NOT want them in your space!
CHEAP CLIENTS = DISASTER