A pricing strategy is a key element of any vacation rental business's success. As a host, you need to set a price that is fair for your potential guests and profitable for you. A well-thought-out pricing strategy can help you maximize your profits and attract guests. However, setting the right price can be challenging and it’s easy to make mistakes that can negatively impact your pricing strategy.
In this post, we’ll share three common pitfalls that can ruin your pricing strategy and provide tips on how to avoid them.
Failing to Monitor Demand
One of the most common pricing pitfalls is neglecting to assess market demand for your listing type. If you aren't tracking the popularity of your rental in your market, you may be leaving money on the table.
Do you rely on a static pricing solution? If you have a set price that never changes all year round, you’re missing out on potential revenue. A static pricing model doesn’t take into account changes in supply and demand, availability, local events, or seasonality. Plus, it can make your listing less attractive to potential guests who are looking for a competitive price.
Gone are the days of setting one flat rate and hoping for the best. Keep your prices competitive and up-to-date by using a dynamic pricing solution that adjusts your rates automatically based on market trends, demand data, and on real-time consumer search data. With Beyond’s dynamic pricing, you can make sure that you are pricing your property more accurately and proactively. You can also set minimum and maximum prices, so you never price your rental too low or too high.
Focusing Solely on the Competition
As hosts, it is easy to believe that the way to stay competitive is by offering lower prices than competitors, especially given the guidance of most industry providers. However, this approach lowers prices below what is profitable and reduces baseline expectations. It creates a vicious cycle of needing to lower prices further to remain competitive. In contrast, a dynamic pricing strategy takes into account not only pricing but also demand, market trends, and perceived value of a listing based on historical and seasonal data sets.
With Beyond’s Insights Pro offering, you gain visibility into what your competitors are charging with customizable competitive sets from Airbnb and Vrbo and advanced market insights. This data enables you to set pricing that reflects relevant pricing.
While it’s essential to know what your competitors are charging, basing your prices solely on their rates can be a big mistake. Your rental’s unique features and location can impact its value differently than similar properties. Additionally, your operating costs are different, so your pricing should reflect that. To avoid this pitfall, focus on your rental’s unique selling points and use them to justify your pricing. Ask yourself, what makes my rental worth the price? Beyond’s Pro offering unlocks a next-level approach to your vacation rental pricing strategy.
Ignoring Seasonality
Seasonality is an important factor in your pricing strategy, and neglecting it can have a significant impact on your bottom line. For example, you may be able to charge more during peak season when demand is high and guests are willing to pay a premium. On the other hand, you may need to lower your prices during the low season to attract guests and stay competitive. Recognizing the seasonality of your rental business and adjusting your prices accordingly can help you maximize your profits.
Beyond’s advanced revenue management data and analytics is the leading option in the industry, and even better, we make it easy to keep your prices in top shape—by automatically adjusting your rates for you. This way, you can focus on what you do best, providing the best hosting experience for your guests.
How can Beyond help?
With shifting traveler trends and continuous growth of supply having a dynamic pricing solution in your corner is vital to maintain an effective vacation rental pricing strategy. A proactive pricing strategy is key to running a successful vacation rental business, ultimately maximizing your revenue and occupancy rates. By avoiding common pricing pitfalls, including static pricing, not leveraging forward-thinking data, and ignoring seasonality, you can dramatically increase in revenue. With Beyond’s advanced insights, machine learning capabilities, and real-time data, optimizing your pricing strategy has never been easier. So why wait any longer? Sign up today and make more money with your vacation rental business!
.png)
.png)
.png){kind=small}
.png){kind=small}
.svg)
.svg)
