Smart price is on, but the price on the calender is still the base one.
Hi, I am a new host in Melbourne.
I hope my problem can be solved there.:)
When I see other hosts' listings, their price is different based on high peak time and low peak time. I was wondering if they turn smart price on or they manually set prices? According to explainations of smart price, I think the different price is because hosts turn on the smart price, BUT my listing's price is all the same on each day, which is the base price, even when I turn on the smart price.
Does anyone encounter this problem?
Re: Smart price is on, but the price on the calender is still the base one.
Smart Pricing's algorithm can be difficult to understand, but here are the basics that I have figured out through using it for several years. .
1. Smart Pricing is guest-specific. The price will show higher for a guest if the algorithm thinks a guest may pay more for a space. The price that shows on your calendar may not be the price a prospective guest is actually seeing.
2. Airbnb's focus has been to be the low cost leader in the rental space. Thus the algorithm will show the minimum amount you will accept most of the time. To combat this, set the minimum at an amount you are comfortable with, not necessarily the lowest price you will accept. You can always lower the price manually if needed.
3. Smart Pricing will increase and decrease prices based on room availability in your market, however the "market" may be larger than you think. Smart pricing works in a general geographic area, not a neighborhood or possibly not even a town. I believe in our area (Tucson, AZ) the pricing extends to at least a 70 mile radius. Keep this in mind when setting your high and low rates.
Because I am not interested in losing money in my business, I have Smart Pricing's minimum price set about $30 per night higher than what Airbnb tells me it should be and at the price point where bookings start to decrease. Thus about 90% of the bookings I receive are at my minimum price. However, I manually increase my pricing during times I know that I can get more (special events or high season) and manually decrease the price for nights that I am not booked.
Understanding that Smart Pricing probably will not increase the price until "X" amount of the homes are already booked, I manually increase the pricing as far as a year out during high season/events to make sure I get the maximum rate in case someone books early.
My philosophy is to set the minimum price in Smart Pricing to what I want the average person to book at. If Smart Pricing charges a guest more then I look at it as having made a bonus for that night.
Hope this helps you understand how Smart Pricing works and how it can benefit your income when used properly. Feel free to ask if you have further questions.