Are you using Smart Pricing?

Nick
Former Community Manager
Former Community Manager
London, United Kingdom

Are you using Smart Pricing?

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Hi everyone, 

 

Price is one of the most important factors for travellers before booking. For Hosts, it is crucial to price their listing correctly, but it can also be a riddle, especially if they are only beginning their hosting journey. 

 

To get the price right, many refer to Smart Pricing and use it to their advantage (you can read how on this great post by @Ann72.)

 

Having said this, do you use the Smart Pricing feature, and if so, how? 

 

I look forward to reading your replies.

 

Thanks

Nick

30 Replies 30
Mark116
Level 10
Jersey City, NJ

We sometimes turn it on since we assume that having smart pricing on helps put you higher in the search.  But as a tool, it is useless.  I don't know that I've ever seen Smart Pricing give us a higher than listed rate, not even on New Years Eve in the NYC area.  So, in terms of maximizing revenue, it is useless.  The smart pricing tips are often insulting, like telling me I should be offering a fully furnished 2 bedroom apartment for $50 a night.

Mike-And-Jane0
Level 10
England, United Kingdom

@Mark116 Are price tips the same as the price smart pricing would give?

According to posts, no. 

Diane385
Level 2
Holladay, UT

I use smart pricing as a baseline.  I agree with previous posts that I need the "smartness" seasonally.  One thing I have found is that my 5 star Airbnb with many amenities very close to 4 ski resorts is compared to a single bedroom in someone's basement.  I think there should be a comparison to nearby hotels.  I do like reminders when rates are going up in the area so I can increase my rates.

I use it but only after I set a floor for my base fee. I have a 9 room apartment and I was constantly being asked to lower my rate to compete with a studio apartment. In the early days, it would raise my rates on popular weekends. Now, it seems mostly dormant.

I would suggest the algorithm doesn't have enough data to make the right decision for specific properties and seems too generic to be practical.

Lisa723
Level 10
Quilcene, WA

No. In my experience it underpriced very dramatically. Also, since Airbnb’s guest service fee is variable and computation undisclosed, Airbnb has a conflict of interest; if it persuades me to lower my price then it can raise its own guest service fee without increasing the guest’s total cost. I’ve had excellent results with Wheelhouse.

Tomas329
Level 1
Gothenburg, Sweden

I think the smart pricing is pretty stupid and low. It does not seem to account for breakfast, nor the quality of the rooms

 

Ann72
Level 10
New York, NY

@Nick  I use it, but I don't let Smart Pricing think for me.  I do the thinking about the value I offer and factors the algorithm doesn't consider, like acreage, the quality of amenities like sheets and towels, and the high degree of maintenance of a property.  I then put Smart Pricing to work for me.

 

I have been overriding it more often than not this year, when demand has been extremely high.  I list on VRBO and use their dynamic pricing on Airbnb.  VRBO's prices are much higher.

 

After getting so many bookings at prices much higher than my base, I'm loath to turn Smart Pricing back on because I know it will hover just above the minimum.  Even though my minimum is a good price that I would normally be happy with, I don't want guests who've booked at the higher prices to see much lower rates.

 

Laurelle3
Level 10
Huskisson, Australia

@Nick  I  don't use the Smart Pricing as I found that it doesn't pick up events in our local area untill the demand shows. I enter and alter the price for these dates in advance before the demand. I check the yearly calender for events in our shire and it sends an update if added events or cancelled, I then ajust accordingly.

@Ann72 I agree with you if guests who have booked at a higher price and being able to see the lower prices.

@Tomas329 also points out that individual Airbnb's offer different products, styles and needs for guests.

However, I do like where it advisers that there is a demand in the area such as wedding or conference or whatever.

Max144
Level 10
Bongaree, Australia

@Nick  i use it for a guide line, i have noticed as new dates open up on calendar it is only one dollar less than my minimum where as before it was very low. 

Lorna170
Level 10
Swannanoa, NC

I do not use smart pricing.  Firstly, it always tells me to lower my price below what is reasonable for my amenities and expenses, and less than the amount that I have been charging for many, many years..  Secondly, it dos not appear to follow seasonal pricing -- increased in the spring and fall in our location.  Maybe it works for a new host who has not studied pricing patterns in their area, or is very underpriced or just anxious to book every night regardless of the cost.  Not for me.

Ok thanks sharing your views on it, It's really  Informative post  that helpful for everyone. Price is one of the most important factors for travellers before booking. For Hosts, it is crucial to price their listing correctly, but it can also be a riddle, especially if they are only beginning their hosting journey. 

 

 

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Laura2592
Level 10
Frederick, MD

@Nick yes we use it. 

 

It suggests we are $30-$50 lower per night than other similarly situated homes in the area. It started out by suggesting we rent an entire house for $30 a night. 

 

We ignore it, but occasionally we will get a dollar or two more per stay if the bot thinks that is a popular night. We only have it on because rumor has it that it helps your search placement. But its 100% useless for us. 

smart price is clearly a useful thing when you do not have experience and reviews

I am rather new and I agree with your statement.  Once I turned it own my property became fully booked for months.  My plan is to raise prices once I get solid reviews from these set of guests.  I am not making as much as I could really get but just enough to make some financial sense.  I have to create a strong reputation and then I can raise prices up.