Their study shows demand-based pricing can increase revenue while lowering parking rates
Published May 4th, 2017
Recently two professors at Carnegie Mellon University’s Tepper School of Business, Mark Fichman and Stephen Spear, published an article in the Pittsburg Post-Gazette focused on the need for Smart Parking tools in Pittsburg. Mark Fichman is a professor of Organizational Behavior and Theory, and Stephen Spear is a professor of Economics.
These professors have been studying ways to improve parking for four years now, and the ways that smart parking can improve a city. These benefits range from decreasing car emissions and lowering a city’s carbon footprint to improving the performance of local business and providing a positive experience for tourists.
Between 2013 and 2016 the professors gathered data and ran a parking demonstration project that used variable dynamic pricing for parking on the streets around CMU. Previously all the streets in the area charged $2 an hour. They adjusted prices based on occupancy data to as high as $2.25 and as low as $0.50, with a goal of having parking spaces occupied between 60 and 80 percent of the time. The professors were able to raise revenues of over $200,000 in additional parking, even as they lowered the average parking rate, by driving additional use of payed spaces!
The Pittsburg Post-Gazette has called for a smartphone app for Pittsburg that has real-time information on available spaces, like the Parker app Streetline has.A parking guidance app can help consumers know about the prices for parking all over the city, and the current level of parking availability, enhancing the effects of optimized pricing. It’s a key component in modern smart parking solutions.