Discount for long term stays

[Antonino91]

Greetings, everyone. 

I wanted to discuss how an unbalanced long term discounting may hurt your profits, by encouraging guests to book for longer periods than they intend to stay while paying less than if they booked for their actual stay. 

For instance, let us say that your base rate is 100, and you offer only a 20% weekly discount. Guests staying 6 nights would pay 600, but guests booking 7 nights would pay 560. 

Airbnb does not allow you to insert too low discount, e.g. if you offer 10% for weekly stays, you cannot offer 8% on 14-nights stays, but it does not prevent hosts from introducing too high discounts.

I have written an excel workbook where you can insert the discount you want for any period of time from 2 to 31 nights. It automatically updates its values depending what discounts you are entering. If the discount is too low or too high, it appears in red, otherwise it appears in green. 

Please find the workbook at: 
https://1drv.ms/x/s!Aqby6LY6ldM-h4JBcJm0OUc6evfRkg?e=u8IaPn

[Huma0]

@Antonino91 

Good point. With weekly discounts, the maths should be pretty easy to figure out. I have my weekly discount at 10%, so it's not possible for someone to get the room cheaper by booking more nights.

However, recently I had a guest booking for 27 nights. She then changed the booking to 28 nights and got them for less than the 27. I don't mind as on a monthly booking, it doesn't make a huge difference to the nightly fee. It did make me wonder about the monthly discount though (currently 15%). I will certainly look at your spreadsheet and see if tweaking it would be worthwhile.

Thanks for posting.

[Debra300]

@Antonino91,

I admit that I didn't read your spreadsheet, but have made similar comments about balancing the cost benefit of a long-term stay.  I do think a host has to consider the probability if the dates in a long-term reservation would still have been booked at the regular/less discounted rate.

[Antonino91]

One should definitely give discounts for long term stays, to encourage longer stays, lessen the workload, etc. Only, if you want to give, say, a 25% monthly discount, you should increase the discount gradually, for instance 14% for 7 nights, 20% for 14, 22% for 21. Otherwise, if you put just the 25% discount, and I need only 22 nights, I will book for 28 and pay less.