Latest / Host Planet: Airbnb, Holiday Let, and Vacation Rental Insights / Pricing Smarter: Guardrails, Demand & Deals

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Pricing Smarter: Guardrails, Demand & Deals · 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 Housefully.
• 0:05
  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 Bevan Thompson
• 0:15
  from Housefully and he's got 5 tips to share about the pricing
• 0:19
  strategy. OK, real talk now for all you
• 0:21
  hosts out there, you know that moment when your guest messages
• 0:24
  you again with, hey, what's the Wi-Fi code?
• 0:28
  Or you're staring at 5 different calendars wondering if you've
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  works. Less stress, more bookings
• 1:36
  sorted with Hostfully. Bevan, thank you for joining us
• 1:45
  on Host Planet Bite Size. You've got 5 pricing strategy
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  tips to share, so take it away with tip number.
• 1:54
  One tip #1 booking up pricing strategies is good for your rent
• 1:56
  portfolio. So the first thing to do is look
• 1:58
  at dynamic pricing. I think that's number one tip
• 2:01
  from me. Dynamic pricing, if you don't
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  know what it is, it adjusts prices in real time based on
• 2:06
  demand market conditions and it's done by using online
• 2:09
  integrated platforms alongside a PMS like host filling.
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  So the good thing about them is it sort of increases rates
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  during high demand periods. So and it's without your, I
• 2:20
  think the big, the big thing is it's without your interaction
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  with it. It happens for you sort of
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  behind the scenes, if you like at lower rates during low demand
• 2:28
  periods as well to make sure that you're sort of, you know,
• 2:31
  working in the right parameters and you can use them in, like I
• 2:35
  said, in in conjunction with the PMS.
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  We've got ones like Price Labs Wheelhouse beyond pricing people
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  like in our integrations page. It means you can maximise your
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  revenue during the higher peak times, fill vacancies in lower
• 2:48
  slower times as well in slower periods, but also it enables you
• 2:52
  to set borders. I always liken it when I'm
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  talking to customers as like when you're playing bowling,
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  like a bowling alley, you have those little, those little gates
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  you can put up to start the ball going down the drain.
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  You can set your high and low so that you always know that you're
• 3:03
  going to be making what you want.
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  You're never going to go below the lowest price you want to
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  make. And it means there's no constant
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  twiddling like a lot of people have to spend a lot of time
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  setting prices, looking on a calendar, what events are near
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  me? What's going on in the area.
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  You don't have to do that because even though the dynamic
• 3:19
  price, the system doesn't know what events are going on, it
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  knows what rates are going on in the area.
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  So it means that you don't have to have a, an events calendar on
• 3:26
  your desk as well as this that you know, it means it just takes
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  care of your pricing. So without your involvement,
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  it's absolutely superb in my opinion.
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  Yeah, a great tip. And I remember when I was
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  starting out and I didn't know anything about dynamic pricing
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  at the start. So I was just manually setting
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  rates and I didn't realize the events that were going on in the
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  local area when demand was really high.
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  And I took some bookings when Leeds Festival was going on,
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  very, very popular near where I am.
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  And those people who stayed at my property got a really, really
• 3:54
  cheap rate because I wasn't using a dynamic pricing tool.
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  So yes, highly recommend that. There's some great ones that we
• 4:01
  work with on our site, Priceless Labs Beyond.
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  We've also working with Quibble as well.
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  So check them out. And yeah, they all do quite
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  similar things basically, as Bevan is saying, tracking all
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  the demand and and adjusting your rates accordingly.
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  So fantastic tip #1. What's tip #2 Bevan?
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  #2 stay seasonal a little bit like your Leeds festival thing
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  here, Just prices if you're not using Price Labs or you know one
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  of those other pricing management softwares based on
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  the time of the year and seasonal demand is very, very
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  important, especially if you're in the UK.
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  Here we have big long summer holidays in six weeks in the
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  summer and you've got a seaside sort of property or somewhere in
• 4:38
  the countryside or something like that.
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  You need to be maximizing your price strategy based on the
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  season. You can also drop your prices
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  for more budget conscious travellers in the offseason.
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  Try and make sure that you're filling those dates and it so
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  it's all about making Haywall the sunshine.
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  If you want to, I've raised a reminder, you know, the
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  summertime comes along. Make sure those prices are up to
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  match the demand that's out there.
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  Superb. Yeah, of course you want to be
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  matching the demand according to the seasons.
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  And usually in the UK we've we've got summer, we've got
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  Christmas and New Year, Easter, generally when the school summer
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  holidays are right. Absolutely.
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  And that's, that's pretty much like the, you know, if you are
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  going to make Haywall the sunshine also while the snow
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  falls maybe in the winter as well.
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  Absolutely. OK, then tip #3.
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  Big one, this one, understand your market and the competition
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  around you. I think that's super important.
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  If you research similar properties in your area,
• 5:29
  understand their pricing strategies, their occupancy
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  rates, analyse their pricing during different times of the
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  year as well. So links into the previous one
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  about seasons. And also I think what's
• 5:39
  important is price according to what you've got, price according
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  to your amenities. Amenities, amenities.
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  Until I work with Americans, I always say amenities all the
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  time. If you're giving something extra
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  like a hot tub or a pool or you've got something a bit
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  quirky, ensure it's reflecting your pricing.
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  You know, it's not always about being lower, it's about pricing
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  what you've got. So you know, that's very
• 5:58
  important. Make sure that sort of you look
• 6:02
  at your guest booking patterns as well.
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  If you understand your market, you know, if your guests are
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  booking later or earlier, something that's really handy
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  for that is key data with a lot of my customers use that to look
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  at trends, to look at things like that.
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  Again, sort of integration you can plug in through hopefully
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  really, really good for knowing about what the market's doing
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  out there. And and if you are setting your
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  own prices and not using sort of a pricing management dynamic
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  pricing tool, then key data is really, really handy for that.
• 6:26
  Yeah, key data can be incredibly useful, especially for the
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  bigger property managers to to really track what's going on in
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  in your local area. And interesting what you say
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  there about not necessarily just being the cheapest among your
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  competition because there are guests out there and if your
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  property looks great, but it's cheap, they will not book
• 6:44
  because they'll think there's something wrong with it.
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  So, so price it accordingly according to to all your all
• 6:50
  your amenities. Like like you were saying.
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  OK then Bevan tip #4. And then before length of stay
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  discounts, promotional pricing, things like that, very, very
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  important. If you offer discounts for
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  longer stays to incentivise guests to book for multiple
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  nights or offer discounts for a limited time to try and attract
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  people during when you've got sort of inventory to get rid of,
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  you know, time in your diary you want to fill, that's really,
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  really important. Weekly or monthly discounts for
• 7:16
  longer stays are a really, really good idea.
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  Again, you can control them from within PMS or even from from a
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  dynamic pricing tool and use promotional rates during your
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  slower periods. Yes, I was saying, you know,
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  seasonal, seasonal pricing, but you're going to have some
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  periods which are famously, notoriously quiet.
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  Why not try the sort of discounts of those periods as
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  well? And interestingly, the discounts
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  and promotions, it's something that the OTAs like Airbnb and
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  booking.com reward you for because if you're running a
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  promotion, you're a little bit cheaper, they might be then
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  incentivized to show your place to more people.
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  And, and, and that kind of moves into something else where the
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  OTAs like it when you're constantly nudging your prices
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  and changing them according to market demand.
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  So using a dynamic pricing tool will help because that'll alert
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  the algorithm and hopefully the you'll then get it seen by by
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  more potential guests. OK, then tip #5 Bevan. #5 this
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  one may seem obvious, but a lot of people might not have done
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  it. So it's worth mentioning.
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  Cost plus pricing, calculating costs associated with your
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  rental, fixed and variable costs that you've got things like, you
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  know, cleaning things, like anything you can think there is
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  a cost of a rental to you. I mean, and then add your profit
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  margin you want to make on the top to make sure that you're
• 8:31
  always in a profit when you're renting your property.
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  I know it sounds so simple, but people go, oh, you know, I've
• 8:37
  set the rate of this because everyone else is sitting at
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  that. Are you actually making your
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  profit on what you're doing? Is it actually a business, you
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  know, or are you just, you know, is it a fool's errand?
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  And that's a very important question to ask yourself.
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  Add up all your expenses, divide by the number of nights you
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  expect to book, if you've got history from the booking in the
• 8:51
  past, if you're looking at setting your pricing again, and
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  then add your desired profit margin on top of that and make
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  sure that you're making money. I mean, we're all of it for
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  business at the end of the day. Yeah, knowing your numbers is,
• 9:02
  is so, so important. And I think we'd probably be
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  surprised at the number of hosts and property managers who just
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  think, oh, well, that sounds like an OK nightly rate.
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  I'll take that without realizing that they're actually making a
• 9:13
  bit of a loss or maybe only making a few pounds.
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  And then in that case, you know, what's what's really the point
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  of doing it? You know, we're all, we're all
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  trying to, to make a little bit of money out of it.
• 9:23
  OK then Ben, 5 great tips there. So dynamic pricing, look at the
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  seasonal aspect, understand your competition, look at those
• 9:31
  length of stay discounts and cost plus pricing, make sure
• 9:35
  you're making a profit and tell us a little bit more about
• 9:39
  Housefully and where people can find out more information.
• 9:42
  Sure, you can pop it onto hostfully.com.
• 9:44
  Find out more about our award-winning vacation rentals
• 9:47
  platform, online guidebooks, hosting devices.
• 9:50
  There's all sorts of things going on at house at the moment.
• 9:52
  Lots and lots of elements we're working on help you earn more in
• 9:55
  your rental safe time and it'll elevate your guest experience
• 9:58
  with things like the guidebooks and the guest communication as
• 10:00
  well. So that's hostly.com.
• 10:01
  Get along to that. Superb, check it out.
• 10:04
  There's also some special offers in the show, notes Bevan.
• 10:08
  It's been a real pleasure. Thank you for sharing those 5
• 10:10
  tips and for joining us on host Planet Bite Size.
• 10:14
  Thanks for having me. Cheers.
• 10:15
  Great to chat to Bevan Thompson there about pricing strategy,
• 10:18
  give a dynamic pricing tool to try to make sure you're not
• 10:22
  leaving money on the table. All right, that's it for today's
• 10:25
  episode. Remember, this podcast is
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  That's it for today's episode. Until next time, happy hosting.