Latest / Host Planet: Airbnb, Holiday Let, and Vacation Rental Insights / Master Your Minimum Stay Strategy with PriceLabs

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Master Your Minimum Stay Strategy with PriceLabs · Host Planet: Airbnb, Holiday Let, and Vacation Rental Insights

• 0:00
  Hello and welcome to House Planet Bite Size, the podcast
• 0:03
  brought to you by House Planet and House Philly.
• 0:05
  My name's James Farley, the founder of House 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 Karishma
• 0:14
  Lunawat from Pricelabs and she's got 5 tips to share about
• 0:18
  minimum stay strategies. OK, real talk now for all you
• 0:22
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• 1:45
  Karishma, thank you for joining us on House Planet Bite Size.
• 1:48
  You've got 5 minimum stay tactics to share, so take it
• 1:53
  away with tip #1. Absolutely.
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  Tip #1 is data, data, data. A lot of times what hosts do is
• 2:04
  start with what they feel is right or, you know, their gut
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  instinct that, hey, I think three nights minimum is good
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  enough for this. Or, you know, maybe I can just
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  put four night minimum for my weekend because a lot of times
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  it feels safe or it feels manageable because or because
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  everyone else is doing it. But our gut isn't the best
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  source of truth. Data is.
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  So the first tip would be to look at what's happening in your
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  market, look at what your competitors are doing, look at
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  what guests are really booking AT, and then probably set your
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  minimum stays. A simple example of that would
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  be let's say you think A2 night minimum or a three night minimum
• 2:45
  for your weekend is what you feel is right.
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  But that's a super low demand weekend and people are probably
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  just booking one or two nights. You might not even show up in
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  search results. So look at the data and then
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  make your decisions. That would be the first tip.
• 3:00
  That makes a lot of sense. Yeah, I think I think you're
• 3:02
  right. You know, so often house and
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  property managers have a gut feeling that they need to have a
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  minimum of two or three or 4. But without without knowing what
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  your guests want, then it's it is just a guess.
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  It is just a guess. OK then, Karishma.
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  So tip #2. Tip #2 would be to really make
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  sure you're getting your gaps filled and your last minute
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  stays configured well. And this one's, this one's
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  really intuitive because let's say a guest checks out on a
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  Thursday and another one arrives on Saturday.
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  Now you have a two night gap, but let's say you've set up your
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  minimum to be 3 night long. So this gap essentially becomes
• 3:45
  unbookable and you're losing out on some money that you could
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  have made on A2 night gap. So use the like if you're using
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  price lapse, there's something called often gaps setting.
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  Make sure it's configured correctly so that you don't lose
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  money on those gaps that are created by two longer bookings.
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  And second one in the same part would be to make sure your last
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  minute minimum stays are configured well.
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  Because let's say you have a last minute cancellation and you
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  have a two night gap open, like a two night open for like
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  tomorrow or day after tomorrow. And you've set up again, a rigid
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  3 night minimum rule. Even when travellers are looking
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  to book stays last minute and you're going to make some money,
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  you're probably losing out on that revenue because you have
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  longer minimum stays last minute.
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  So your last minute minimum stay and your often gap minimum stays
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  are super important to optimize on the occupancy part of your
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  profile. And obviously no, money is not a
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  good option when you can earn some money.
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  So yeah. Yeah, Yeah.
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  There's a couple of points here, isn't there?
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  Because from an OTA point of view, if you're available for
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  more nights, then the likes of Airbnb and booking.com will
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  reward you because you're available.
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  And also what's your suggesting, let's say you have a minimum
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  three nights stay, but you have two nights available.
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  Would you automatically charge the three night price for those
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  two nights? It really depends on where this
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  is. So for example, if you have this
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  really far out in the future, you have the opportunity to
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  charge more and see if people are willing to pay more.
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  Because as you come closer to the check in date, you can drop
• 5:25
  your prices. But if it's like really last
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  minute then probably raising your prices might not make as
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  much sense because at this point people are probably looking for
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  deals or you want to fill up your rooms faster.
• 5:35
  Yeah, because I guess there'll be property managers out there
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  saying, well, I've got a three night minimum because I've got
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  costs with cleaning and that kind of thing and I have to
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  charge this, this minimum price. So they might say, well, I'll
• 5:45
  put the price up and if I get the booking then then great.
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  If not, then it's it's not the end of the world.
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  OK then, Karishma. So tip #3.
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  Tip #3 And this is a really important one, is to protect
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  your far out bookings. And this is where it really gets
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  strategic. Let's say it's we're in July now
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  and someone wants to book tonight for Christmas.
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  You get very happy because hey, I'm going to get a booking.
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  And you say yes. But what you're essentially
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  doing is you're locking out an entire high demand, high value
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  period for some guaranteed revenue today.
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  And you're giving up on the opportunity cost of getting a
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  longer higher value booking maybe probably a few months down
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  the line. So this, this balance between
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  getting your revenue locked in today versus losing out on the
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  opportunity cost of getting better, higher value bookings is
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  super important. So that's where making sure that
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  updates are really far out or if it's a very high demand period,
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  having higher better minimum stays to optimize on the revenue
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  part of your profile is super important.
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  Yeah. So if you're saying, saying if
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  it's like, I don't know, six months, nine months, even a year
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  before, what do you think the minimum should be?
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  It really depends from market to market, honestly.
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  So like there's people who start with like a five night minimum
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  and go up to like a seven night minimum.
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  But again, this it's very hard to generalize what your minimum
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  should be. Going back to point number one,
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  look at data, look at what works, what doesn't work, and
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  then figure out your bedroom stays.
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  Yeah, yeah. The the point being, you don't
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  want to take a one night stay and then later on that costs you
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  a three-week booking or a month long booking or.
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  Something like that, yeah, blocking out the entire period
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  that you might have gotten booking for.
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  Exactly. And you can obviously set the
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  parameters here in in a tool like Price Labs.
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  OK then, Karishma. So tip #4.
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  Tip #4 And I think this is one of the most underutilized
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  features, even in Price labs is to make sure your minimum stay
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  reflects the season, not just the calendar.
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  So think of it like this, travellers book differently
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  depending on the time of the year.
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  In summer, maybe families are looking for like week long
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  stays. Whereas in low season periods,
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  maybe there's just like folks looking for a weekend quick
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  getaway. So what you should do is
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  breakdown your calendar by high season, by shoulder season, by
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  low season, by high demand or low demand periods and adjust
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  your minimum stays accordingly depending on what works for
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  those periods. What are the kind of guests
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  you're getting? What are the kind of bookings is
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  the market getting and then adjust your minimum stays
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  accordingly. And what really helps here is
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  Price Labs has recently released their autumn and stay feature.
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  So what we do there is give you a complete minimum state
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  recommendation month by month for the entire year, depending
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  on what's working and what's not working on data in your market,
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  in your neighborhood and stuff like that.
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  So the algorithm does it's magic and you don't have to really
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  shoot in the dark saying hey, maybe this could work.
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  This couldn't work. You just look at the
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  recommendations for every month given the price lapse based on
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  like market data and make your decisions.
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  Perfect. Making it easier for people to
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  to break down the different seasons and to and to implement
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  their rules accordingly. OK then, Karishma, so #5.
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  All of this might sound super complicated, and a lot of times
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  hosts also get overwhelmed by the idea of, you know, adding so
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  many tiers to their minimum stays.
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  So the last step would be to not get into the manual burden of it
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  and just automate it with a good dynamic pricing tool.
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  End of the day, you have so many things to do as a host.
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  You have to manage the operations, the guest
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  experience, cleaning people. So this is not another thing
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  that you want to add to your plate.
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  You automate all of this. So for example, with price
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  lapse, you can set the lowest boundary that you can accept as
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  middle stays. There's a lot of hosts that
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  absolutely are not OK with one night stays.
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  So you can say that, hey, you can communicate that to the
• 9:54
  software that I do not ever want one night stays.
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  My lowest minimum is 2. And then you can set your rules
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  for last minute, for far out, for often gaps, for seasons, and
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  you never have to worry about, hey, there's a gap.
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  And I forgot to lower my minimum still because the algorithm
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  automatically does it for you. So automate, automate, automate.
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  Don't add one more thing to your plate when you have already so
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  much to take care of. OK then 5 brilliant tips there.
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  So we've got the first one which is day-to-day to data and #2 get
• 10:23
  your gaps and last minute stays sorted out.
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  Number three, protect your far out bookings.
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  Make sure you're getting the longer booking rather than the
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  one or two night stays. Breakdown the calendar for the
• 10:35
  different seasons and automate as much as possible.
• 10:39
  OK. Then Karisha, just tell us a bit
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  more about Price Labs and where people can find out more
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  information. Absolutely.
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  You can just go to our website. Hello dot pricelabs dot go.
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  We have a 30 day free trial, so you can just get in there, add
• 10:51
  your listing and see what recommendations are, what's
• 10:53
  working out for your market, what isn't, And if you have any
• 10:56
  questions you need anything, you can reach out to us at
• 10:59
  support@pricelabs.gov. You're super quick and reply.
• 11:02
  Superb. We'll put all those details in
• 11:04
  the show notes, including a link to a special offer as well.
• 11:09
  Brilliant. Karishma, thank you so much for
• 11:11
  sharing those tips and for joining us on host Planet Bite
• 11:14
  Size. Thank.
• 11:15
  You It was great to be. Here All right, that's it for
• 11:17
  today's episode. Remember, this podcast is
• 11:19
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  managers. That's it for today's episode of
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  Host Planet Bite Size. Until next time, happy hosting.