Hollywood Bowl calls on dynamic pricing as heatwaves hit sales
Hollywood Bowl called on its dynamic pricing system to endure falling ten-pin demand during the summer’s record heatwaves, prompting a share price boost.
Britain’s biggest ten-pin bowling operator said the summer’s “exceptionally prolonged, dry weather” had “heavily impacted” its trading, as UK like-for-like revenue fell 5.6 per cent in the second half of this year.
“Demand remained resilient during the extended period of record hot weather in the UK, supported by our disciplined cost and pricing model, and our operational initiatives to drive footfall,” chief executive Stephen Burns said.
The London-listed group saw like-for-like revenue slip by one per cent across the group in the year to September, as poor summer sales were softened by 2.3 per cent growth in the first half of the year.
“Our affordable, inclusive proposition has continued to ensure we are well-positioned in an environment where consumers are closely watching what they spend,” Burns told shareholders.
Hollywood Bowl beats ‘unhelpful weather’
Hollywood Bowl operates a dynamic pricing system which allows it to hike or drop prices by as much as a pound, based on the footfall at its venues.
Burns has previously told City AM that this allows the group to deliver better value for customers who are willing to visit at less convenient times.
He said: “Those who are time-rich but money-poor can come at a time that better suits us and pay a significant discount, and then the money-rich time-poor will pay a slight premium to come at a time that suits them.”
Investors were heartened by Hollywood Bowl’s ability to weather record temperatures, as shares in the group jumped six per cent in early trading to 260p.
Ross Broadfoot, an analyst at RBC Capital Markets, praised the company’s “impressive update given the unhelpful weather endured by the group.
“We continue to believe the stock has been unfairly penalised by weather, if a more “normal” weather pattern were added to the measures taken by the group on cost and dynamic pricing, we would have most likely been looking at a decent beat for this year.”
Hollywood Bowl opened four new UK sites in the year to September, taking its total to 95 sites. The group operates a further 13 locations in Canada, under its Splitsville brand.