Dynamic pricing is a key capability for parking facilities to increase revenue performance. Done correctly, dynamic pricing can help you better match available supply to true demand while driving revenue growth. But many parking solutions rely on 3rd-party parking technology that make true demand-based dynamic pricing impossible. For example, the booking app doesn’t talk to the cameras, meaning it’s impossible to price based on occupancy.
Our approach is different. Rather than piece together solutions, we built a vertically-integrated parking platform that offers a holistic view of all parking activity, demand, booking sources, and rates. This enables a set of rich dynamic pricing capabilities, including our experimentation engine that tests different rates to determine the optimal pricing.
This handbook section covers our approach to dynamic pricing, from high-level pricing strategy to the technology and data we use to optimize rates and meet real-time demand. We’ll help you understand the process of moving from traditional pricing and payment options to fully dynamic rates, including any facility upgrades, platform solutions, and other critical steps for a smooth transition.
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Approach: Align on goals to maximize revenue potential from unmet parking demand while maintaining driver satisfaction and overall competitiveness.
A clear pricing strategy is crucial for clarifying revenue potential, avoiding an unfavorable driver response, and planning for longevity. We take a data-driven approach to inform our perspective and create an actionable plan with measurable results. We also know that dynamic pricing can feel like a significant change to “the way things have always been done.”
That’s why one of our first goals when assuming management responsibility for a new parking facility is to understand potential revenue growth through pricing changes. During this period, we research relevant factors to help us determine how pricing could be changed, including:
We review the results of this analysis with you to set a clear strategy. Our strategy outlines research conclusions and hypotheses for the effects of dynamic pricing based on different demand scenarios. During the initial rollout period, we gradually test rates to gauge driver price sensitivity. We also closely monitor parking data to assess if price changes are causing negative impacts on the driver experience. Relevant parking data points might include:
Over time, we can gain a better understanding of the realistic price range that drivers are willing to pay based on specific demand factors. If prices were historically flat or unchanged, you may see an immediate uplift with sustained revenue increases as price accuracy improves.
Approach: Implement a vertically-integrated system that includes QR-code based payments, license plate reading cameras, and integrations with parking aggregators to support a full range of dynamic pricing capabilities.
Basic dynamic pricing (what we call level 0 or level 1) is essentially quick research to identify demand cycles in your parking activity, and then adjusting your prices so the rates are lower at off-peak times and higher during peak times. This method may not require more advanced technology like license-plate-recognition (LPR) cameras, but it also won’t yield the best results.
True dynamic pricing is built on a strong foundation of technology. It requires the ability to monitor and use real-time data like parking session starts, rate of entry, total sessions, time of day, etc. for rate adjustments. Sophisticated capabilities may also include external factors that drive demand, like events, competitor pricing, or weather patterns. Tying these separate data sources and controls together requires a unified parking management system for fully dynamic pricing.
With AirGarage, you won’t need to piece together different systems and technology for partial results. Instead, we’ll comprehensively onboard your facility and ensure you get the full benefits of our dynamic pricing capabilities. This process includes steps outlined in the sections below:
Other parking vendors and operators tend to focus on either parking management or technology, but not both. Our integrated system provides complete coverage across all booking channels instead of restricting dynamic pricing to one specific app. With AirGarage, you’ll benefit from a unified system for booking, performance data, parking session detection, payment, enforcement, and more.
Once dynamic pricing capabilities are in place, we can test, monitor, and optimize for maximum occupancy.
Approach: Ensure an always-on method of optimizing rates with continual monitoring, A/B testing, and predictive algorithms.
While static pricing is typically set once and only changed periodically, dynamic pricing is constantly tested and adjustments are made as demand factors change. Our dynamic pricing system is set to continually refine pricing with increasingly fine-tuned adjustments (down to the minute) and segmentation for additional revenue capture. This method keeps your pricing optimally balanced regardless of environmental changes like weather, seasonal shifts, events, and more.
During the initial rollout, we take an iterative approach that drives occupancy without deterring potential customers.
Our integrated system gives you an industry-leading view into real parking activities and rates, beyond what other providers can offer. This breadth and granularity of data helps us quickly develop and deploy tests, then measure the corresponding impact. You can easily see the effect of pricing changes and other activities in a consolidated dashboard view that aggregates data across your facility - from violation collections to real-time occupancy.
Approach: Provide real-time visibility into dynamic pricing activity and overall financial performance for your facility.
While it’s helpful to know if revenue is generally up or down, owners may want more detailed financial insights to clarify which marketing activities or pricing changes affect revenue most. This detail could include breakdowns by segments like driver type, demand fluctuations, event pricing, marketing activities, and more. We help clients get this full picture of performance through an intuitive self-serve Intelligence Dashboard.
As a revenue-share partner, this reporting capability helps us make data-driven decisions and show the impact of a proactive management approach and persistent focus on revenue optimization. You’ll have access to both self-serve reporting through the intelligence dashboard and support from an experienced Partner Success Manager.
Your dashboard lets you see direct revenue uplift from dynamic pricing across various time ranges. This comprehensive view also helps you explore how rates are adjusted to improve performance at peak times while maximizing parking during off-peak hours. You can understand exactly how rates were adjusted, when, and the results.
