Is Geographic Price Discrimination in Travel Just Good Business—or a Problem?
Is offering differentiated hotel pricing based on the geographic location of the guest a viable revenue management approach?
Revenue Optimization — Viewpoint by Max Starkov
Offering differentiated hotel pricing based on the geographic location of guests brings us to a timeless question: Can business practices be both profitable and ethical, or is that just a comforting fairy tale for capitalists with a conscience?
Differentiated pricing based on geographic location is nothing new—it's Price Discrimination 101, a cornerstone of both old and new revenue management. From a strictly revenue perspective, it makes total sense. If data shows that residents of San Francisco have deeper pockets than those in Kansas City, why not adjust prices accordingly?
But the issue isn't whether it works. Of course, it works. The real question is what this says about us as an industry.
At its core, this strategy exploits socio-economic disparities, further widening the gap between those who can and cannot afford to travel.
In an era where experts predict a doubling of global travelers within the next two decades—driven by emerging markets like India, China, and Brazil, along with the rise of "silver tourism" fueled by longevity hacks and longer, active lifespans—practices like this could exacerbate a growing problem.
Cities like San Francisco—already poster children for over-tourism and hyper-gentrification—risk becoming exclusive enclaves for the ultra-wealthy. Let's be real: if current trends continue, we'll end up with a global network of gilded cities inhabited only by wealthy tourists and the equally affluent people catering to them. Everyone else? Priced out.
As I've said many times, if we don't curb our greed, Paris in 30 years will be Disneyland. And no, I'm not talking about Disneyland Europe—I'm talking about the entire city becoming unlivable, drowning in waves of rich tourists. On the flip side, if your pockets aren't deep enough, you'll be left with an "Action Park" experience. (And if you're unfamiliar with this infamous New Jersey attraction, do yourself a favor and read "Action Park: Fast Times, Wild Rides, and the Untold Story of America's Most Dangerous Amusement Park". What a story!). Rome? Same. It will be filled with fake gladiators and terrible Fettuccine Alfredo (which I love, but only the original one, that has NOTHING to do with what most Italian restaurants serve to tourists). Florence, Barcelona, Prague, Berlin... You name it.
If we keep treating cities like commodities, we're not just pricing out travelers from less affluent regions—we're erasing the soul of these places. In 20 years, San Francisco may no longer be a city; it'll be a curated experience, a playground for tourists with expense accounts, a dystopian theme park with a "local culture" carefully engineered by "live like a local" OTAs.
So, is this a viable revenue management strategy? Sure. But it's also a short-sighted race to the bottom, one that chips away at the very essence of what makes travel meaningful. Unless we rethink this trajectory, we might soon find ourselves with a world that's more profitable but far less worth exploring. Which one do you choose?

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