[SPONSORED CONTENT] Dynamic pricing and revenue management solution provider, PriceLabs, discusses how its dynamic pricing solution is useful for short-term rental hosts and property managers.
Are you an Airbnb host or a vacation rental manager? Ever wondered how PriceLabs sets its pricing recommendations? Let’s break it down in simple terms.
Think of data as the fuel for PriceLabs. We gather details about your property, like its location, size, future prices, and booking history. We also scan millions of listings on platforms like Airbnb, Vrbo and Booking.com to understand global booking trends. And don’t worry, we make sure this data is clean and accurate.
- Focusing on local trends
Even within the same city, different areas can have different booking patterns. For instance, two neighbourhoods in Chicago, just a few miles apart, can have different demands because one might be a business hub while the other is more touristy. PriceLabs pays attention to these local differences to give you the best pricing advice.
- Predicting demand
Forecasting future bookings is a bit like predicting the weather. We look at past booking patterns and use them to guess how future dates might book. For example, if a particular date in the past had a lot of bookings 150 days before the stay, we might expect a future date to have a similar pattern. We then adjust these predictions based on current booking trends.
- Understanding price sensitivity
Just like in economics, where demand can change with price, we try to understand how likely your property is to get booked at different prices. For instance, if you price your property too low, people might think it’s not of good quality. But if you price it too high, it might not get booked at all. We find the sweet spot for you.
- Maximising your revenue
At the end of the day, it’s all about earning the most from your property. We find the price that gives you the highest chance of getting booked and earning the most money. It’s like finding the perfect balance on a seesaw!
- Why different prices for different times?
Prices can vary based on the season, day of the week, market trends, and special events or holidays. For instance, a property might be priced higher during a popular holiday or when there’s a major event in town.
- Rate evolution – how prices change over time
Prices aren’t static. They can change based on new information or market conditions. For example, if a famous singer announces a concert in your city, demand for accommodations might spike, leading to higher prices.
- Why do prices change as the booking date approaches?
Imagine you set a high price for a date that’s a year away. As that date gets closer, if your property hasn’t been booked, you might want to lower the price to increase its chances of getting booked. This is a strategy to maximise your earnings.
- The science behind price changes
Let’s say you can change your prices at specific times before the booking date. Depending on when you change the price and the demand during that period, you can determine the best price to set. This is a bit like a puzzle, and PriceLabs uses advanced maths to solve it for you.
- Can prices increase last minute?
Absolutely! If there’s a sudden surge in demand, like a surprise event, prices can go up. This is similar to how flight prices sometimes increase just before the departure date.
- Why do airlines and vacation rentals price differently?
While both are in the travel industry, they operate differently. Airlines have fewer competitors and can keep prices high even at the last minute. Vacation rentals, on the other hand, have many similar properties competing for bookings so they might lower prices as the booking date approaches to attract guests.
- The importance of dynamic pricing
Setting a one-time price for your property isn’t enough. To truly maximise your earnings, prices should be dynamic and adjust based on various factors. PriceLabs’ data shows that using dynamic pricing can boost your revenue by an average of 11 per cent.
Conclusion:
Dynamic pricing is a powerful tool for property managers. It takes into account various factors to set the perfect price for any given date. If you’re curious to see how it can benefit you, give PriceLabs a try. Whether you’re a pro or just starting, PriceLabs is here to help you earn more from your property.
