Smart Pricing works if you get it right. And it isn't rocket science.

[Kevin1322]

This year,  we turned on smart pricing.

On some bookings we are getting 15c to 20 percent more per stay.

Admittedly there is high demand.

We kept our base price the same as our normal price, only allowing smart pricing charge more, never less.

It was that simple. We followed sage advice from experienced hosts on this,  make your bottom price your usual price, and what have you got to lose.

It remains to be seen how guests perceive "value" as star ratings in their reviews, but for money in the bank we have already seen a boost.

So I'd give this a cautious thumbs up.

How are other fairly new hosts finding smart pricing?

[Stephanie]

Hey @Kevin1322 !

Great topic. You've reminded me of a fantastic topic that @Ann72 made for the Festival of Hospitality back in 2019 on how she's mastered Smart Pricing: https://community.withairbnb.com/t5/Hosting/Festival-A-Smart-Pricing-Journey/m-p/1123517

Hope that helps,

Stephanie

[Stephanie]

Nice one @Mike-And-Jane0 ! 

Yeah, price tips are those dashboard suggestions that pop up whereas smart pricing is a price threshold you can set on your listing. 

Looking forward to hearing how you get on!

Thanks

[Mike-And-Jane0]

@Stephanie Hmmm - I am not convinced. The little graph you get with smart pricing switched on shows the price that Airbnb would charge if the minimum price set didn't stop them. The prices given here (£35 per night) look suspiciously like Airbnb price tips to me. Why, after all, would they be any different?

Anyway I'll give it a few weeks and see how it goes.......

[Stephanie]

@Mike-And-Jane0 Maybe when it's rise and shine time for @Ann72 she can add some advice. £35 a night is pretty remarkable for your listing 🤔  (remarkably low.)

Cheers

[Mike-And-Jane0]

@Stephanie It's only for the 1 bed place so is vaguely credible although are last booking was at £60. I am certainly not going to risk smart pricing the 3 bed as we have had price tips for that in the £30-40 range!

[Ann72]

@Mike-And-Jane0  No, don't use their minimum.  Set your minimum at what you would normally charge - the least you would like to get for the space.  Set the maximum at Airbnb's maximum.  It will never go that high but the algorithm needs a range to work with.

Never use their minimum.  Ever.  Never ever.

[Mike-And-Jane0]

Hi @Ann72 Don't worry even I am not stupid enough to take the Airbnb suggested minimum.  The problem I have is that we were charging £50 per night weekdays and £60 or 65 for weekends. For smart pricing I have set a minimum of £60 but fear that the listing will just bump along at £60 and so make us uncompetitive for the weekdays. If I had more (any) faith in the concept I might have put in £50 as the minimum.......

interestingly when I flirted with Homeaway a while back their auto pricing offering asked , from memory, if you wanted high occupancy or high rates. I guess Airbnb are just targeting high occupancy hence low rates.

[Ann72]

I didn't think you were stupid @Mike-And-Jane0  🙂  Yes, you're right that Airbnb is obsessed with occupancy, homeowners and their budgets be damned.  

To speak to the whole idea of "competitive" if I may:  Do all of your neighbors offer accommodation in old rectories?  Are they all overlooking 13th century churches?  I didn't think so.  I want you to practice regarding your property as unique.  I know that smacks faintly of braggadocio and is therefore un-English to do so, but facts are facts:  You have a unique property that is not subject to the same rules as people who are all in the same apartment block putting their places up for rent.

You will be pleasantly surprised at the bookings that come in at the new rate.  A place like yours must require a lot of maintenance so you're just doing it for the good of the building after all is said and done.

[Mike-And-Jane0]

@Ann72 Thanks for your post - Indeed this place needs constant maintenance and costs a fortune to heat in winter as double glazing and insulation wasn't invented in 1750. Next week we are having 1/8 of the roof replaced as my daughter is objecting to the water running down her bedroom wall. Thankfully the roof on the holiday let portion is somewhat more waterproof. 

[Ann72]

The heating costs are why I don't lower my price in the off-season @Mike-And-Jane0.  People occasionally try to get a discount by saying "something is better than nothing," but it costs three times as much to run the place in the winter with people in it so the fact is something is not better than nothing if my cost to accommodate them exceeds what they pay.

[Kevin1322]

exactly. then you can't lose

[Kevin1322]

I think that is spot on advice.

[Mike-And-Jane0]

@Ann72 The little graph thing that appears when you edit smart pricing suggests a price of £66 per night and yet the listing just shows £60. Any idea why the suggested price in smart pricing isn't making it through to my listing?

[Ann72]

@Mike-And-Jane0 @Tracy720  I don't understand.  Have you set a minimum that's higher than the suggestion?

[Mike-And-Jane0]

@Ann72 No I set my minimum at 60 (about 20 more than the suggested minimum), the graph suggested 66 but the calendar said 60. However I persevered and after a few days the calendar said 66 so all is well.

[Ann72]

Ah, I see @Mike-And-Jane0.  Sounds like the dynamic pricing just needed to gather its thoughts.