Innovative pricing approaches in the alpine skiing industry

Abstract

The tourism industry is one of the fastest growing business sectors in the world. Over recent years, mountain tourism has become a more and more important part of this growth. This PhD thesis focuses on the alpine skiing industry, which is one of the categories of mountain sport tourism with the strongest financial influence in the mountain regions. Alpine skiing is an extremely competitive industry that has experienced stagnation trend in recent years. Therefore, it is important to examine factors that may have positive effects on the performance of ski resorts. Innovation is fundamental in order to realize the potential of the alpine skiing sector and to ensure sustainable business growth. For many ski resorts, innovation is a necessary condition for survival in a fiercely competitive environment. In other words, the competitiveness of ski resorts depends on their ability to innovate. The overall purpose of this PhD thesis is twofold. First, the thesis aims to increase knowledge about factors that affect alpine skiing demand and the price for alpine ski passes. Second, it aims to provide new knowledge about how the alpine skiing industry can use innovative pricing approaches to achieve competitive advantage. This is one of the first studies to contribute to the research-based knowledge on innovative pricing approaches in the alpine skiing industry. In general, the demand for alpine skiing exhibits strong variation. Hence, during periods with low demand, there is unused capacity. This thesis argues that one way to exploit unused capacity in the low-demand periods is to use innovative pricing strategies. Specifically, the findings of the appended research articles suggest that ski resorts can increase profitability and deal with fluctuations in demand by implementing the following pricing approaches: (1) variable pricing based on seasonality and (2) a dynamic pricing approach based on different weather scenarios. In addition, this thesis provides empirical evidence on the price–quality relationship at ski resorts and discusses practical implications for ski resorts’ managers. Possible directions for future research on innovative pricing approaches in the alpine skiing industry are also included for interested readers.