Is Discounting Sensible?

Imagine the backpacking industry if there was no discounting? Imagine what this would mean for prices and how expensive backpackers would perceive Australia. Essentially the backpacking industry is "demand sensitive." We all agree that there is an oversupply in our industry during most months of the year. This obviously leads to a shitload of distressed inventory, which is like perishable fruit... which operators are very keen to move and is often the catalyst for volatile price fluctuations, and futile pricing wars in certain backpacker hubs. Discounting is not the only possible way to move this distressed stock... but the problem is that for some operators, typically smaller ones, without the resources, brand awareness or large marketing budgets it pretty much is. This is because 'price' is the only viable point on which to market themselves. So do you really believe that during low seasons every single operator is going to play ball and not undercut when the average utilistaion rates are somewhere in the vicinity of 50- 70%? So don't discount if you don't have to... that's an awesome position to be in. Value-add wherever you can as an alternative to discounting... groovy. But so long as there is a substantial over-supply of operators the backpacking industry will always be a 'buyers market' and so you are living in a hypothetical, theoretical and barely imaginary fantasyland if you think that discounts are going anywhere! Because with the exception of goon and sex backpackers love nothing more than discounts!! Why?? Because backpackers want to maximize their experiences within the limits of their budgets.

Category:

Travel & Events

Tags:

• Backpacking
• BrokePacker
• Discounts
• Discounting
• Price
• Cheap