Updated: May 9, 2024
The Coachella Valley is not just a geographical region but a cultural hotspot, drawing thousands of music enthusiasts to its famed festivals, Coachella and Stagecoach. These events, held back-to-back in April, have historically fueled the local hospitality industry. However, recent data presents an intriguing puzzle: while Coachella experienced a significant drop in Revenue Per Available Room (RevPAR), Stagecoach remained relatively unaffected. Let’s explore the numbers and the underlying factors driving this divergence.
Understanding the Data
The data reveals a notable decline in RevPAR during Coachella weekends, from April 12-14 to April 19-21, 2024. This decrease is particularly pronounced in Desert Hot Springs, surpassing the decline observed in Palm Springs. Conversely, Stagecoach, transpiring from April 26-28, maintains a stable RevPAR trend across both locations.
Palm Springs
The occupancy data shows how full the accommodations were during Coachella and Stagecoach weekends compared to previous years. For instance, during Coachella Weekend 1 in 2024, accommodations were 61% full, down from 72% in 2023. Similarly, during Weekend 2, occupancy dropped from 67% in 2023 to 55% in 2024. On average, the occupancy rate across both weekends was 58% in 2024 compared to 69% in 2023.
The Average Daily Rate (ADR) tells us the average price paid for a room per night. For Coachella Weekend 1 in 2024, the ADR was $523, a 10% drop from $580 in 2023. Likewise, for Weekend 2, ADR decreased from $505 in 2023 to $463 in 2024. On average, across both weekends, the ADR was $493 in 2024 compared to $543 in 2023.
Lastly, RevPAR (Revenue Per Available Room) combines occupancy and ADR to give us an overall picture of the revenue for accommodation. For instance, during Coachella Weekend 1 in 2024, the RevPAR was $321, a 23% decrease from $418 in 2023. Similarly, for Weekend 2, RevPAR dropped from $337 in 2023 to $254 in 2024. On average, across both weekends, RevPAR was $286 in 2024 compared to $376 in 2023.
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Desert Springs
During Coachella Weekend 1 in 2024, accommodation occupancy in Desert Hot Springs dropped to 58% from 82% in 2023. Weekend 2 saw a similar trend, with occupancy decreasing to 49% from 74% in 2023. Across both Coachella weekends, occupancy was 53% in 2024 compared to 78% in 2023. However, for Stagecoach weekend, occupancy increased slightly to 54% in 2024 from 52% in 2023.
The average room rate during Coachella Weekend 1 in 2024 was $483, down 25% from $640 in 2023. However, for Weekend 2, the ADR increased slightly to $415 from $400 in 2023. On average, the ADR was $449 in 2024 across both Coachella weekends compared to $520 in 2023. For Stagecoach weekend, the ADR remained relatively stable at $377 2024 compared to $385 in 2023.
RevPAR during Coachella Weekend 1 in 2024 experienced a significant decrease to $280 from $525 in 2023. Similarly, Weekend 2 decreased to $202 from $298 in 2023. On average, across both Coachella weekends, RevPAR was $239 in 2024 compared to $407 in 2023. For Stagecoach weekend, RevPAR increased slightly to $205 in 2024 from $201 in 2023.
Analyzing Coachella’s Impact
The sharp decline in RevPAR during Coachella raises pertinent questions. Why did one event experience a substantial decrease while the subsequent festival saw minimal impact? Several factors may contribute to this phenomenon.
Let’s start by analysing Coachella’s ticket sale pattern this year. Traditionally, Coachella has been a ticket-selling juggernaut, often selling out within hours. However, this year, the festival experienced a 14%-17% decline in ticket sales compared to the previous year. Some factors influencing these sales may include:
- Market Saturation: Coachella’s dominance doesn’t shield it from the broader trends affecting the festival industry. Other popular festivals, such as New Orleans’ JazzFest and L.A.’s Beach Life Festival, grapple with unsold tickets. This hints at a larger market saturation and shifting consumer preferences.
- Changing Talent Landscape: Booking agents and industry insiders point to the evolving dynamics of headliner talent. This year’s lineup, featuring Lana Del Rey, Tyler the Creator, Doja Cat, and No Doubt, didn’t generate the same level of excitement as past headliners like Taylor Swift and Beyoncé. This shift underscores festivals’ challenges in securing top-tier talent amidst a competitive landscape.
- Price Sensitivity: Coachella ticket prices have steadily increased over the years, with a $50 hike from 2022 to 2024. This price escalation and inflationary pressures have made festival attendance less accessible, particularly for younger demographics. As ticket prices rise, festival-goers become more discerning, weighing the value proposition against their budgetary constraints.
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Analyzing Stagecoach’s Consistency
Stagecoach’s resilience in ticket sales compared to Coachella this year can be attributed to several key factors:
- Target Audience Consistency: Stagecoach caters to a specific demographic—country music fans. Unlike Coachella, which has diversified its lineup with various genres, Stagecoach maintains its focus on country music. This consistency appeals to a loyal fan base, ensuring steady ticket sales.
- Strong Lineup Appeal: Stagecoach’s lineup featured major industry names in country music, such as Eric Church, Miranda Lambert, and Morgan Wallen. These headliners and a mix of established and emerging artists provided a compelling reason for fans to attend. Additionally, the anticipation of surprise appearances, such as speculation about Beyoncé joining the lineup, generated excitement and boosted ticket sales.
- Resurgence of Country Music: Country music is experiencing a resurgence in popularity, evident in its chart-topping success and growing fan base. Stagecoach capitalized on this trend by offering a platform for traditional and contemporary country artists, attracting enthusiasts eager to immerse themselves in the genre’s culture.
- Unique Festival Experience: Stagecoach distinguishes itself from Coachella with its distinct atmosphere and offerings. From BBQ-focused eateries to Western-themed activities like cowboy karaoke and boot customization, Stagecoach creates an immersive experience tailored to its audience’s preferences. This unique festival ambience enhances the overall appeal and encourages repeat attendance.
- Effective Marketing and Promotion: Stagecoach’s marketing strategies likely contributed to maintaining ticket sales momentum. Organizers effectively communicated the festival’s value proposition and connected with potential attendees by leveraging targeted advertising campaigns, strategic partnerships, and social media engagement.
By understanding these factors, Stagecoach successfully navigated the challenges of the festival landscape, ensuring robust ticket sales and sustained relevance within the industry.
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Implications and Future Considerations
Coachella and Stagecoach festivals offer a fascinating case study of how different factors affect vacation rental revenues. While Coachella has seen a decrease in its revenue per available room (RevPAR), Stagecoach has held steady or even increased. This tells us a lot about what’s going on behind the scenes.
Coachella’s dip might worry locals who depend on these festivals for business. But if we dig deeper, we can find ways to address this. It’s all about understanding why these trends are happening and finding smart ways to adapt.
As the hospitality industry changes, being proactive is vital. You can’t just sit back and hope for the best. Instead, you should think about things like marketing your vacation rental. Contacting the right people at the right time ensures your rental stays busy even when festivals aren’t in town.
Let’s not forget about partnerships. Working closely with festival organizers can be a win-win. They get happy attendees, and we get more business. Plus, you can collaborate on transportation and promotions to improve everyone’s experience.
The hospitality industry is always changing, especially during big events like festivals. But by staying proactive and thinking outside the box, you can keep your vacation rentals thriving no matter what the future holds.
Conclusion
In the Coachella Valley hospitality scene, the contrasting RevPAR trends seen during Coachella and Stagecoach weekends shed light on the complexity of festival-driven tourism. It’s like peeling back layers to understand what’s really going on. By taking a deep dive into the data and considering factors like who’s coming, how they’re getting here, and what they’re into, businesses can adjust their game plans to make the most of the buzz and tap into new chances to shine in this lively festival scene.
It’s all about being savvy and flexible. By digging into the numbers and getting a handle on the demographics, logistics, and cultural vibes driving these trends, stakeholders can fine-tune their strategies to perform their best and seize the exciting opportunities in this dynamic festival environment. You can use the PriceLabs Market Dashboard to stay current with your neighbourhood market trends and the PriceLabs Dynamic Pricing tool to make sure you automatically make the most of demand fluctuations.
About PriceLabs
PriceLabs is a revenue management solution for the short-term rental and hospitality industry, founded in 2014 and headquartered in Chicago, IL. Our platform helps individual hosts and hospitality professionals optimize pricing and revenue management, adapting to changing market trends and occupancy levels.
With dynamic pricing, automation rules, and customizations, we manage pricing and minimum-stay restrictions for any portfolio size. Prices are automatically uploaded to preferred channels such as Airbnb, Vrbo, and 100+ property management and channel integrations. Every day, we price over 350,000+ listings globally across 135+ countries, offering world-class tools like the Base Price Help and Minimum Stay Recommendation Engine. Choose PriceLabs to increase revenue and streamline pricing and revenue management. Sign up for a free trial at pricelabs.co today.
