Originally Posted by
CD747
I guess the thing I don't get is, if the rate is:
Friday - $100
Saturday - $100
Sunday - $100
Why not simply offer Friday and Saturday only, at a rate of:
Friday - $150
Saturday - $150
Because you're in a market with other hotels. If the going rate was $150, you'd be charging $150 for all 3 nights. If the market clearing price (driven by supply and demand fundamentals) is $100, then raising it to $150 means you will have fewer guests. 100 guests for 2 nights at $150 is much worse than 500 guests for 3 nights at $100.
Originally Posted by
CD747
can't they simply increase the Friday-Saturday rate even further to account for the average?)
Unless you're a monoploy, you can't just set any rate you want.