What is Dynamic Pricing?
Posted: March, 12, 2025 11:51 AM ET • 3 min read
The demand for data tracking in real-time has been increasing throughout various industries across Canada. Why? To get an inside look into business performance and deploy strategies that maximize revenue potential. To do so, businesses, specifically in the parking and mobility space, deploy dynamic pricing strategies that streamline operations, all while enhancing the overall experience for customers.
This article explores dynamic pricing, how it works, and how it benefits facility owners and customers alike.
What is Dynamic Pricing?
Dynamic pricing is a pricing strategy that adjusts prices based on various external factors, such as current market demand, supply changes, competition, and the season. With the use of data analytics and a range of technologies, prices can be continuously adjusted in response to real-time supply and demand. Artificial Intelligence (AI) and machine learning have sophisticated algorithms that can analyze market conditions at any given time to predict optimal pricing.
How Does Dynamic Pricing Work?
For dynamic pricing to be used effectively at a parking facility, parking data occupancy should be collected. This can be done with smart sensor technologies that track and monitor the number of cars parked in real-time, as well as license plate recognition to capture peak and low times. Mobile parking apps can also be used to help parking operators track occupancy levels and when demand for parking is high. Once this information is readily available, they can set rates dependent on occupancy allocated for that period.
In a real-world scenario, a parking lot near a sporting stadium could use dynamic pricing to adjust rates as game time approaches. This strategy makes the parking lot more attractive to drivers who need to park quickly to make it to the game on time. Meanwhile, drivers who aren't attending the game or aren't in a rush likely choose to park elsewhere, freeing up spaces for those trying to get to the game.
Advantages of Dynamic Pricing for Facility Owners
The ability to adjust prices during peak times ensures operators maximize revenue for facility owners during high-demand periods, utilizing data-driven insights to analyze parking trends and adjust their rates accordingly. Another benefit is improved space utilization. If a parking facility implements a dynamic pricing strategy, there will be reduced congestion as drivers will park only if they need a parking spot, regardless of the rate. With reduced congestion, drivers looking for a spot can easily park at your facility, enhancing the overall customer experience.
Advantages of Dynamic Pricing for Customers
The most significant benefits dynamic pricing offers customers are convenience and transparency. With mobile parking apps, parking prices can be checked and booked in advance. This level of transparency allows customers to plan ahead and make any adjustments as they see fit. Another benefit is that customers will be encouraged to park during off-peak hours for lower prices, helping to make parking more accessible. This way, drivers can find parking at the right price when needed most.
To recap, dynamic pricing is a pricing strategy and data tool that can be implemented to maximize revenue, gain valuable insights, and enhance customer experiences. Parking facility owners and managers across Canada should embrace this multi-purpose technology for an improved, flexible parking experience.
References
Donatucci, A. (2023, December 21). Everything you need to know about dynamic pricing for parking. Parking Industry. https://www.parkingindustry.ca/parking-revenue/everything-you-need-to-know-about-dynamic-pricing-for-parking
Dublino, J. (n.d.). Dynamic pricing: What is it & how it effects e-commerce. business.com. https://www.business.com/articles/what-is-dynamic-pricing-and-how-does-it-affect-ecommerce/
Gibson, K. (2024, May 10). Dynamic pricing: What it is & why it’s important: HBS Online. Business Insights Blog. https://online.hbs.edu/blog/post/what-is-dynamic-pricing
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ABOUT THE AUTHOR
Dani Ierullo
Director, Proposal Development
In his role as the Director of Proposal Development at Precise ParkLink, Dani plays a key role in interpreting our prospective clients’ needs and developing the technology and management solutions that address the challenges they identify. Under his direction, the team of proposal writers he oversees are charged with developing content strategies that best position Precise ParkLink as a leader in the Canadian parking market.
Dani’s holistic approach to proposal development is born out of a unique combination of training and industry experience. He has a Bachelor of Arts in Business from York University and a further Six Sigma Black Belt certification from the Schulich School of Business, and his decades as an industry professional have included roles in accounting, estimating, project management, parking operations management, parking consulting, and most recently, business development.
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