Reaction to Skift Article about the ‘Taylor Swift Effect’

Big Events Present Big Opportunities for VR

Reaction to Skift Article about the ‘Taylor Swift Effect’

A recent Skift article illustrates the massive ADR bounce and longer booking window accompanying marquee events such as the Taylor Swift Eras Tour or its nearest real-world analog, the Super Bowl.

Big events are a prime example of how dynamic pricing creates revenue optimization. That shouldn’t come as a surprise to anyone who’s worked in, or merely understands, the hospitality business. But there’s much more to learn about these cultural phenomena and how they fit into your annual planning.

The economic impact

Most estimates place the US economic impact of Taylor Swift’s Eras tour at somewhere between $5 billion and $10 billion. Visit Pittsburgh announced that her two-night swing in June 2023 generated $46 million in direct spending, with 83% of attendees coming from outside Allegheny County.

It’s not just the show nights that are affected. An exhaustive article from hospitality data company Lighthouse noted that the biggest month-to-month rate spike actually came the month prior, suggesting that the so-called “Taylor Swift effect” can affect pricing for a month or more. (Hotel rates spiked as much as 80% while short-term rentals saw around a 37% bump around actual tour dates.)

According to one study, the average Swiftie spent around $1,300 to see her, including tickets, travel, and clothing. With an average ticket price hovering around $1,100, that seems low. However, it may indicate that many concertgoers don’t fly OR spend the night. Those who do spend at least one night are likely to choose lodging near the venue.

It’s safe to assume, however, that many will build a vacation around the concert and/or seek more affordable accommodations outside the city, especially if they’re part of a group. That’s where you come in.

How short-term rentals can take advantage of marquee events

If we’ve convinced you that big events can have a huge impact on your revenue, then here are some tips and strategies to help you capitalize:

  • Keep a pulse on events in your area
    Relatively few events are held in stadiums, and plenty draw from out of town. For every Coachella there are a hundred Wintergrass or Gulf Coast Beer & Bacon (and BBQ) festivals. Make yourself aware of events in your area where lodging is a big consideration.
  • Entice groups
    Short-term rentals lend themselves to groups, which may be enough to lure eventgoers out of the city. If you have properties that can accommodate them, you could push ADR as high as you dare but still be cheaper per person than an urban hotel. If you can arrange transportation to and from the venue (for an additional fee, of course), so much the better.
  • Plan ahead
    Always be looking a year out so you know what’s happening in your area. The more exclusive and expensive the event, the more likely eventgoers will book lodging well in advance. You won’t always know how far you can push rate, so for annual events, expect some trial and error.
  • Contact organizers
    Event organizers often include lodging options on their websites, so don’t hesitate to reach out and ask to be included. Consider incentives like discounts, early bird rates, a shuttle service, camping, themed events (see below), or even a chance to win tickets.
  • Get creative
    Some hoteliers put together Swift-related tours or packages to further entice guests. Anything specifically targeting eventgoers can work, especially if it seems like you “get it” and aren’t merely trying to take advantage of the situation. For example, if someone on your team is a big Swiftie, they could help you build a themed package based on Tay-Tay touchstones like a friendship bracelet-making workshop, afternoon tea, and a special pre-party with drinks like a Lavender Haze (IYKYK).
  • Use a dynamic pricing tool
    Our revenue management platform, Rented, does more than just make it easy to take advantage of market fluctuations, regardless of the driver. It constantly analyzes those movements so you don’t have to.

As traveler preferences continue to evolve around experiences, we believe big events offer a golden opportunity for savvy vacation rental pros to carve out a slice of the action. Our revenue management experts have a deep understanding of event-related pricing and can recommend tools and strategies that can help you capitalize. Request a demo today and break from the crowd!