Nov 10, 2022
4 mins read
Depending on how empty your space currently sits during off-peak hours and how much you are underpricing your busiest days, dynamic pricing can have a huge impact. But real numbers from coworking operators already using dynamic pricing tell a clearer story than any generic estimate.
Here’s what the research says about revenue lift in comparable industries, plus real results from coworking operators who use dynamic pricing.
Dynamic pricing, also called “demand-based” or “revenue management pricing,” adjusts the price of a desk, meeting room, or day pass in real time based on factors like occupancy, time of day, day of week, and booking lead time. True AI-powered dynamic pricing replaces static, one-size-fits-all pricing with rates that respond to actual demand.
A peer-reviewed hotel revenue management study, published via the National Institutes of Health’s PMC archive, modeled dynamic pricing against real hotel booking data and found average revenue increases of roughly 6% compared to static historical pricing. Hotels have run mature revenue management programs for decades, so that figure reflects a relatively optimized starting point also werqwise case study.
Coworking operators starting from flat pricing tend to see larger jumps, because there is more room for optimization. Real results from customers using Flexspace AI’s ecommerce revenue platform that features their AI-powered SmartPricing Agent include*:
• WerqWise: a 142% increase in meeting room bookings and a 117% increase in revenue
• The Shop Workspace: a 110% incremental lift in on-demand booking revenue over one year, with 63% of meeting room bookings made using dynamic pricing
• The Yard: a 2x revenue increase, with automated marketing following up on abandoned bookings driving a 20% quarterly revenue uplift
• Venture X: a 4x increase in conference room bookings and day passes
• The Malin: a 2x increase in online revenue, with a 20% quarterly uplift tied to automated follow-up
While these results are from Flexspace AI’s partners, not independently audited third-party research, the pattern is consistent: spaces moving from flat to an ecommerce revenue platform with AI-powered dynamic pricing see gains well above the 6% baseline hotels report, largely because they were leaving more money on the table to begin with.
*Customer results are based on individual experiences and are not indicative of guaranteed performance. Results may vary
• Off-peak fill rates improve, because lower prices during quiet hours attract price-sensitive bookers who would not have booked at the flat rate
• Peak-hour revenue increases, because high-demand slots are no longer underpriced relative to what the market will actually pay
• Manual discounting disappears, since staff are no longer guessing at last-minute price cuts to fill a room or using outdated data to make changes which tends to erode margin more than it recovers
Yes. Flexspace AI’s SmartPricing Agent does not require multiple locations or a large space to work. It requires enough booking volume and variability in demand for the system to have something to optimize against, which describes almost every coworking space with more than a handful of bookable offices, meeting rooms, or desks.