Latest / Host Planet: Airbnb, Holiday Let, and Vacation Rental Insights / Shorter Booking Windows? Get Your Rates Right with PriceLabs

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Shorter Booking Windows? Get Your Rates Right with PriceLabs · Host Planet: Airbnb, Holiday Let, and Vacation Rental Insights

• 0:00
  Hello and welcome to Host Planet Bite Size, the podcast brought
• 0:03
  to you by Host Planet and Host Philly.
• 0:06
  My name's James Farley, the founder of Host Planet, and our
• 0:08
  goal is to share everything you need to know about buying and
• 0:11
  managing short term rentals. Today's guest is Sianna Vasila
• 0:15
  Nova from Pricelabs, and she'll be discussing the UKSTR market,
• 0:19
  including how hosts can get their pricing right this autumn
• 0:23
  and winter. OK, real talk now for all you
• 0:25
  hosts out there, you know that moment when your guest messages
• 0:29
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  works. Less stress, more bookings
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  sorted with House Philly. Tiana, thank you for joining us
• 1:50
  on host Planet Bite Size. When we look back at summer,
• 1:53
  what stood out most to you? Were there any pricing trends
• 1:58
  that really caught your attention?
• 2:00
  Great question. And by the way, thank you so
• 2:02
  much for having me, James. First of all, to start off with,
• 2:05
  so great question to start off with, I think a lot of people
• 2:09
  are comparing summer to what's happening in autumn now.
• 2:13
  So one thing that caught our eye, I think this summer was how
• 2:18
  the market kind of shifted. So we did see quite a strong
• 2:22
  growth in supply early on and we're talking May, June, July,
• 2:26
  plenty of new listings came online around this time.
• 2:30
  And then suddenly in August, the demand kind of shifted and it
• 2:35
  kind of cooled off a little bit and it seemed like some hosts
• 2:39
  probably pulled back. So compared to the to the year
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  before that and what we saw in terms of demand that was
• 2:45
  definitely a little bit lighter facing was a little bit slower I
• 2:49
  think that most hosts than most hosts expected.
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  So it kind of just goes to show how important it is to keep an
• 2:57
  eye on that real time data market shifts and essentially to
• 3:01
  adjust your strategy as the season evolves or most
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  importantly as the season changes as well.
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  Where are things looking in terms of pricing, the rates that
• 3:13
  people are achieving and also the booking window?
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  Because I think one thing that a lot of hosts in the UK in
• 3:19
  particular have experienced over the last few years, myself
• 3:22
  included, is that the booking window has just got shorter and
• 3:25
  shorter. To the point that today I had
• 3:28
  two bookings and I think 1 was for a check in today and the
• 3:31
  other was for a check in tomorrow.
• 3:34
  Well, I think you're experiencing this pretty much
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  the same thing that most people in the UK are experiencing.
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  And actually UK is not alone in this.
• 3:44
  I think we're seeing this trend quite a lot, at least in Europe.
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  UK and Europe are kind of the markets that I that I would look
• 3:50
  after. So we've seen this trend, but
• 3:54
  somewhere this summer in particular showed that guest
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  behavior does consistently keep shifting.
• 4:00
  So yes, booking windows have gotten shorter.
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  I'll give you an example. So if we're looking at the UK in
• 4:06
  general, for June this year, the booking window was 30 days on
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  average. Last year it was 34.
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  So that's quite a big shift. Essentially what this means is
• 4:17
  that people are waiting longer to make their travel plans.
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  Just you also mentioned where do the rates stand in relation to
• 4:25
  this? Very interestingly, average
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  daily rates were actually higher.
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  So this means that people who are traveling, they're still
• 4:34
  looking to spend, they're just booking a little bit later.
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  So big take away here is to actually stay flexible and to
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  use this market data that we have or these dynamic pricing
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  tools to help capture those last minute bookings when the demand
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  actually does come through. Yeah, staying flexible is so
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  important, but how important is it not to tank your rates too
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  much, especially if you are expecting to get those last
• 5:02
  minute bookings? It's very important.
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  This is why you should, well, don't panic if you're seeing a
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  shorter booking window, if you're seeing that occupancy
• 5:11
  actually is coming in just a little bit more last minute,
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  important thing is to not panic. Don't slash your rates because
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  you, you know you're not getting the bookings at the time that
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  you were receiving them last year.
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  So we've seen that ADR has been steady and actually growing.
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  So make sure that you're in line with how the market is shifting.
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  Don't panic. And yeah, try to hold your rates
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  just gradually, you know, as you're getting into that booking
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  window, very slowly and gradually start to change the
• 5:44
  rates because we know that the less time you have to get
• 5:47
  booked, the more flexible you should be.
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  And it's interesting you mentioned before as well with
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  rates that you're seeing that they've gone up slightly now.
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  I was involved in a webinar with price Labs recently and I said
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  that I think this is out of necessity really because house
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  and property managers, our costs have gone up and up and we've
• 6:05
  had to put the, the rates up in, in response to that.
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  As as we head into, we're into autumn, then as we head into
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  winter, are we seeing something similar compared to summer?
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  Or are there any other trends that people need to be aware of
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  as we as we get closer to to Christmas and New Year?
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  I have a mixed, a mixed answer here.
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  So as we're kind of, well, we're not even moving right, we're in
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  autumn already. So the demand in general, of
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  course, it really depends where you are, but overall the demand
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  is in general is looking softer again than it was last year.
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  Occupancy, the last time I checked was facing around a
• 6:44
  couple of percent below what it was the same time last year.
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  So we're just slightly behind. But again, the good news for
• 6:54
  hosts is that rates are actually holding steady.
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  So ADR is holding steady. So prices are stable
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  essentially. Again, people are booking later,
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  which means that probably a lot of the action that you're going
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  to see in your calendars will be maybe from more last minute
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  conversions. Definitely used to that.
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  So for the host and property managers listening, then what
• 7:20
  are the one or two maybe quick moves that they can make now to
• 7:24
  capture bookings even as demand is a little bit slower?
• 7:29
  Yeah, there are a couple of, I mean there are a lot of things
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  that we can look at, but a couple of them very important to
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  focus on demand pockets. So my job in particular is to
• 7:39
  help people set up their account and to teach them how to use
• 7:43
  price ABS in particular. One thing that I like to say is
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  because I noticed that a lot of hosts focus a lot on this is the
• 7:51
  peak season. This is the low season and
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  there's nothing in between. Actually focus on let's say
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  demand pockets, right? So you have even in your low
• 8:01
  season, you'll have peak demand dates.
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  These are weekends. These are dates with local
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  events. October half term for some
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  schools has already kicked in. Others are, I think it's about
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  to kick in so you can loosen your restrictions like minimum
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  stays around those days. Make sure that the listing
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  highlights its proximity to certain attractions or maybe
• 8:26
  some events that are happening around there that will also
• 8:29
  attract a lot of attention. Also, I think that because we're
• 8:35
  seeing these shorter booking windows happen, just make sure
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  that you keep your calendars open, stay flexible with those
• 8:42
  minimum stays as we said, and do use the dynamic pricing to
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  respond quickly when you see these last minute guests start
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  booking in because that's, you know, they're starting to search
• 8:53
  later, so they must be able to see everything that you have to
• 8:57
  offer. Again, very important because
• 9:00
  the demand is coming in later. Don't panic and try to hold your
• 9:04
  ADR because that booking window will essentially mean that you
• 9:09
  should slowly start adjusting your rates as the booking window
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  is closing down. We talk about flexibility and of
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  course it's really important. Let's get specific then to be
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  flexible. What exactly does that mean?
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  And I'm thinking particularly here in relation to always
• 9:27
  having your calendar open and also the minimum stays.
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  I mean if if you could kind of advise every host and property
• 9:34
  manager out there, I mean should their minimum stay be be as low
• 9:37
  as possible? It depends when we're looking
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  at. So it's very important to follow
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  the way that the market is also moving.
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  If people in my area are only coming in for two days stays and
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  that's a very popular kind of trend in my area.
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  And I have my minimum stay set at 5-6 or seven nights and I'm
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  the only one who does that. And most people are looking for
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  two night stays and they won't even get a chance to see what I
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  have to offer. So, you know, generally when we
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  talk about short term rentals, we kind of expect that travelers
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  will who know what they're doing and they're planning ahead will
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  probably book a longer stay. So we could afford to keep our
• 10:22
  stays a little bit longer far out.
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  But as the booking window draws in, then yes, we should be able
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  to accommodate and be as more as flexible as we can be
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  essentially to accommodate these bookings.
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  Are you seeing any shifts in how people are using short term
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  rentals? You know, for example, longer
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  stays and work Asians and this is something you know, people
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  are blending travel and work now.
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  You know, if they're not set in one place, they're thinking, do
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  you know what? I'm going to travel the world.
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  I can work remotely and then I can go wherever I want and spend
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  a month, a couple of months wherever they like.
• 10:56
  Yeah, for sure. This is probably my favorite
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  subject. I love the way that travel
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  behavior is shifting, and I really love the way that people
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  are blending vacations or, I don't know, I'm going to explore
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  the world, as you say, with actually working.
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  It's kind of that part where we're learning to live anywhere
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  and work from anywhere, right? It's a new habit that's
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  evolving. So longer stays and blended
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  trips are also what's happening here.
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  People are combining work with leisure.
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  We're seeing that a lot of coastal and rural destinations,
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  like you and I had a discussion. Cornwall is a hotspot.
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  Devon, Cotswolds, Scottish Highlands, all of these places
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  are benefiting from that trend essentially because people are
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  looking for, I don't know, a slower way of life, more scenic
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  escapes. And the UK travel market is
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  actually remaining strong. And those hosts in particular
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  when we're talking about this who do cater to longer stays or
• 12:04
  who accommodate remote workers and have the facilities in, in
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  their, you know, SDRS to accommodate for them, then they
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  can really get into that, tap into that demand essentially.
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  Yeah, if you've got a, if you've got a desk and really super fast
• 12:20
  Wi-Fi, then showcase it in your listing because you, you might
• 12:24
  open up to those pleasure travellers.
• 12:28
  We've talked a lot about reading the market then, so if anybody
• 12:31
  new here, just talk to us about Price Labs.
• 12:34
  Why should they be taking a look at Price Labs and what can it do
• 12:37
  for them? Sure.
• 12:39
  I mean, to describe it in very simple terms, Price Labs is the
• 12:45
  dynamic pricing tool. It's a market data solution
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  essentially it's a complete revenue management solution.
• 12:52
  So for short term rentals, but not only.
• 12:55
  So here we're talking mostly about short term rentals.
• 12:59
  What we're doing is we're taking real time data.
• 13:02
  We're looking at demand, we're looking at seasonality, local
• 13:04
  events, competitor prices. We're looking at how quickly is
• 13:08
  the market moving, how is it facing and we will take the
• 13:13
  heavy load off of you and we will update your rates
• 13:16
  automatically every single day. So you still get to set your
• 13:22
  overall strategy, you still get to set your guardrails.
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  We talked about this quite a lot.
• 13:26
  You know, what's my minimum price, what's my maximum price,
• 13:29
  what am I comfortable with? But essentially what price ABS
• 13:33
  does is it handles the day-to-day adjustments.
• 13:36
  So prices always reflect what's happening in the market.
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  And this, I think the biggest take away for me and from the
• 13:45
  conversations I've had with host, host is that it takes away
• 13:49
  the guesswork and it gives hosts more confidence that they're
• 13:53
  priced right every day because how do you know if you're priced
• 13:57
  right or not right? So this is quite a quite a
• 13:59
  powerful tool to help you do that.
• 14:02
  It certainly is, yeah. And I remember when I started
• 14:04
  out, I didn't use dynamic pricing.
• 14:06
  And after I started using dynamic pricing, I realised how
• 14:10
  much money I'd been leaving on the table because you just you
• 14:13
  just don't know how much demand there is at times.
• 14:15
  And it could be demand over a big local event or it might just
• 14:20
  be even a wedding in the in the next village where suddenly
• 14:23
  you've got a lot of people who need accommodation of you're
• 14:25
  not, you're not going to know about everything.
• 14:27
  So using a tool like Price Lapse is going to help.
• 14:31
  So tell us then just like explain how Price Labs sets a
• 14:36
  price, what what's actually happening behind the scenes and
• 14:40
  how often do you tweak the prices?
• 14:42
  Is it every day? Is it every hour?
• 14:45
  How does it work? Sure.
• 14:48
  So the there's by default the automated kind of tweak is
• 14:55
  happening once every 24 hours. Very important thing is when I
• 14:58
  say that you have to, you're in control of your strategy, you
• 15:02
  have to place yourself in the market.
• 15:05
  So that's essentially for those of you who are using a dynamic
• 15:09
  pricing tool, you know that you have to enter a base price.
• 15:12
  We will use that base price. It is like the center of
• 15:15
  everything and we will apply market trends to it.
• 15:18
  So we'll look at the every single listing has its own comp
• 15:23
  set. So we look at the location, we
• 15:25
  look at the size of the property, we look at the comp
• 15:28
  set around it to see what's happening.
• 15:30
  And we're looking after all of these things like occupancy,
• 15:33
  local events, how are the prices moving and we will fluctuate the
• 15:37
  prices up and down. So there's market factors like
• 15:40
  seasonality and demand factor applying, but there's also
• 15:45
  different automated customizations happening based
• 15:48
  on lead time, based on your internal occupancy performance.
• 15:53
  So it's very important to know exactly what's kicking in and to
• 15:58
  allow, I think sometimes less is more.
• 16:02
  There are a lot of things that are automated and they're market
• 16:04
  driven. So they're still looking at how
• 16:06
  the market is moving. Very important thing I just
• 16:11
  wanted to point out, dynamic minimum stay settings are
• 16:14
  something that we have recently introduced.
• 16:17
  So this is you asked me, do I have to be at my lowest minimum
• 16:23
  stay restriction? Well, it depends on how the
• 16:25
  market's moving. If no one, if you know if
• 16:27
  there's a demand for longer stays, we have something new
• 16:31
  introduced dynamic minimum stay settings.
• 16:33
  They will automatically adjust based on demand and leads time.
• 16:36
  So essentially you can capture these last minute bookings,
• 16:41
  obviously still protecting revenue.
• 16:43
  But what this is doing is it's balancing automation with using
• 16:49
  hyperlocal insights to make sure that you're you're using the the
• 16:55
  correct minimum stay restriction in comparison to how the
• 16:59
  market's moving in relation to how the market's moving.
• 17:02
  And in terms of operators really knowing their numbers, how
• 17:07
  important is that in relation to setting the base price and the
• 17:11
  minimum price? Because you want to make sure
• 17:14
  you know, understanding what your occupancy is, that you're
• 17:16
  making a profit At the end of the day.
• 17:18
  You don't want to be setting a price where even if you get 80%
• 17:22
  occupancy you don't end up making a decent enough profit.
• 17:28
  Very important, you have to be aware of your financials, you
• 17:34
  have to be aware of your operations and you have to be
• 17:38
  aware of what property like yours goes for in the market.
• 17:43
  So This is why the most important thing is to set a base
• 17:46
  price. This is why you should always be
• 17:49
  aware of what your minimum price is and use reporting tools to
• 17:54
  make sure that you are actually making a profit.
• 17:56
  So having 100% occupancy doesn't always mean that you are
• 18:04
  profiting from this. It might also mean that you're
• 18:06
  actually losing money because if you only have one night stays
• 18:10
  and for every single turnover, you have to pay cleaning fees,
• 18:14
  maintenance fees as well, bills are coming in.
• 18:18
  Then, you know, once you take all of that away, what is it
• 18:22
  that you're taking home at the end of the day?
• 18:25
  Yeah, 100 percent, 100% occupancy probably means you're
• 18:29
  too cheap. So yeah, you need to be looking
• 18:33
  clearly at the market and, and looking at Price Labs to to help
• 18:36
  you. OK then Siona, fantastic, that's
• 18:39
  really great. Some fantastic tips there and a
• 18:41
  great overview of the UK market just before you go.
• 18:44
  I'm really looking forward to the host Planet Roadshow.
• 18:47
  Of course, Price Labs is the title sponsor and we'll be
• 18:50
  kicking off in Cornwall on the 5th of February.
• 18:54
  So yeah, how much are you looking forward to it?
• 18:56
  I am really looking forward to it, I absolutely love Cornwall
• 19:00
  as I'm sure a lot of people watching or listening to this
• 19:03
  are, so really looking forward to seeing everyone there and
• 19:08
  enjoying Cornwall as well. Absolutely, Yeah, it's going to
• 19:12
  be great. There'll be lots of education
• 19:14
  for short term rental hosts and property managers, lots of
• 19:17
  networking and you get to meet Sianna there, the Price Labs
• 19:20
  team and a lot of other brands who we'll be announcing soon as
• 19:23
  well. Final thing then, Sianna just
• 19:26
  tell us where people need to go if they want to find out more
• 19:28
  about Price Labs. Sure, very simple.
• 19:31
  It's hello.pricelabs.co. You can go onto the website, all
• 19:36
  the information is on there. And if you want to do a free
• 19:39
  trial, you can just click on Start your free trial now.
• 19:43
  Superb. And we'll put all those links in
• 19:46
  the show notes, Siana. It's been a real pleasure.
• 19:48
  Thanks for joining us on host Planet Bite Size.
• 19:50
  Thank you. Lovely to see you James, and
• 19:52
  thank you so much for having me. Great chat to Sianna Vasila Nova
• 19:56
  there from Price Labs. I hope you found those tips
• 19:59
  useful. All right, that's it for today's
• 20:01
  episode. Remember, this podcast is
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