. . .What's the best rate for . . .
Pricing is a never ending chore because there are just too many ‘what if’s’ and ‘what’s going on’s’ with a mix of ‘who’s’ just for good measure to keep on top of it!
Price Guessing VS. Smart Pricing
I don’t pretend to know all things about AirBnb’s price tool. I can only speak of it as to my own experiences. What I found is the concept is great in theory – but reality – it too is a hit-or-miss option. IF you’re the first property to market, the tool sets your rate lower to attract travelers – some times too low. As people book, available units nightly rates go up as inventory goes down. So – how do you make it work? Do you block major dates and open up later and hope you guess the timing just right to get the big dollar for a key weekend? Do you force a rate and hope its not too high and your unit sits empty until demand picks up? Do you drop the rate in hope to get occupancy but oops – you gave it away for a major holiday! Sounds like a lot of work, guessing and time figuring it out to me.
Escape Properties deploys a technology that looks at current, future and historical trends and 28 total points of moving data in real time to set rates based on quality of your photos, sleep capacity, what INQUIRIES are doing vs. BOOKINGS and many other points to try to get “fair” market driven rates – good for both the traveler and the owner.
Focus on winning and not the one amazing booking!
Even if you’re not that in to sports, you will understand my point(s). IF you’re a coach of a baseball team you will focus 75-80% of your efforts on single and double base plays, to load the bases, so when you get the one big home run you sore the most runs batted in (RBI’s). If you’re a basket ball coach you drill your players to have a high percentage, like 90%, of shots taken within 8 feet of the basket (post position or lay ups) not all in trying to drain the 3-pointer from beyond the arc.
The same is true in Vacation Rental pricing. You want to have ‘Fair’ pricing 90% of the time to get the most bookings (occupancy) and 10% of your bookings will be for ‘Top Dollar’ home runs. If you’re always focused on the TOP DOLLAR rate, your occupancy rate will drop and your net revenues will tank. Staying focused on occupancy will grow your revenue. At the end of the year you’ll see a nice over-all balanced successful VR business. This is a marathon, not a sprint.