The significance of competitive pricing and revenue management in the camping industry

Abstract

Currently, the camping industry is responsive to the pricing performance of their competitors. When considering the pricing strategies of the campsite business, competitors should be taken into account as an important factor. The purpose of this research is to assess the possibilities of competitive pricing in the camping industry and examine the effect of competitor pricing levels on relative campsite revenue, to define whether raising or lowering prices relative to the competition contributes more to performance. The paper explores the relationship between pricing strategy and the average percentage difference in revenue per available capacity and occupancy for 32 campsites, relative to their competitive sets, over a period of three years. The result shows that lowering the prices will give campsites higher occupancy rates but consequently lower performance measured by revenue per available capacity.