Pricing fairly and competitively while not undercutting the local market

[Alicia242]

Hello Airbnb community.... Id love to hear some honest raw feedback on pricing.

Ive been a host for 1.5 years in beautiful Salem, Ma. USA. Ive been doing the usual pricing strategy by looking at what comparable places in Salem are going for and also taking in to consideration all. Id like to be busier year round and learn how to price fairly through the year and during the busy season.

In Salem, I feel I should be busier during the summer and for Sept as well, October I am and most hosts are busy (being Salem is the Halloween capitol of the world as well as a beautiful and historical coastal town just 11 miles north of Boston MA.) What would people say is the best way to decide on fair pricing for our listings. I dont want to over charge, but I dont want to undercut the local market either. (Which I seem to see alot 😕 )

 I know there are so many factors to take into consideration, supply and demand, location, ammentities, a unique host or superhost experience (which I give ),proximity to desirable places, how many listings are in our town.++ Thanks for the comments Best Alicia

[Sarah977]

@Rebecca181  I asked my guest, and she said she had no problem finding my place on the platform when she entered all the right filters, or booking for 3 consecutive days. But she is super tech savvy and has used airbnb as a guest many times before. She uses the mobile app. She did say, however, that the set-up of the website is  "way too busy" as in there is too much going on on a page visually, and that it is not user friendly.

[Alicia242]

@Rebecca181 @Matthew285 I list just a guestbedroomn with a seperate bath as well. Not a home and I dont have IB

( instant book) maybe now that Ive been a host for 1.5 yrs ill try the IB and see if that makes a difference. Have you had luck with it? I just want to know who is coming to stay with me. I aired on the side of caution being new to it and I am alone.  I only do a 2 day weekend minimumn nights stay in October here in Salem Ma being the halloween capital of the world. Maybe I should do a 3 day min or try it for other times of the year ex: summer and fall.  Any suggestions or thoughts on that? I dont like these changes that you mention and how it doesnt show our listings thats odd.  😕  Thank you for the tips and suggestions about checking the dashboard I can use all of the help I can get I am not that tech savvy and or savvy with the analytics but I am learning and willing to learn. 🙂 Thanks

[Matthew285]

@Alicia242 we have used Instant Book from the very beginning, so it is the only thing we have known.

We haven't had any problems caused by Instant Book, and the guests have been fine.

Activating Instant Book is supposed to really help your ranking when guests search, but AirBnB doesn't say how much. I remember in another discussion, one host mentioned that when they turned on Instant Book, their bookings went back to normal/busy (bookings had been very slow).

IB isn't a good fit for everyone, but if it works for your situation it is supposed to be a nice boost.

[Rebecca181]

@Alicia242 @Matthew285 @Sarah977 I have instituted certain practices that I thought up on my own when I decided to use Instant Book (I live on the same property I rent out in a semi-attached home and I am very sensitive to people and their energy, or "vibe", so to speak) and it is working out extremely well. In the 'Guest Requirement' section under 'Booking Policies' I do have 'custom questions' that the guest must respond to, in addition to the ones Airbnb invites us to select. So between all of these questions I learn many things - The purpose of the guest's trip; who they are bringing; their ETA; and I specifically ask in a Custom question if they have read the entire listing, including House Rules / Additional Rules, and 'Other Notes'. So by the time they Instant Book, they have to write enough where I get a feel for them. Prospective guests sometimes do not answer these questions when they IB, so I message them, thank them for booking, and ask the same questions, mentioning that it is part of the IB process as I do so. I also do specifically require the government-issued photo ID, and I also state that my property insurer will not allow me to book primary renters who are not at least 28 years old (yes, I can legally do that, and it is not considered discrimination). 

So far everyone is happy to answer them and I have never had to cancel. Except in one case - I never got any answers. No communication whatsoever. But because this answering these questions is mandatory to IB with me, I then had 'good cause' to call Airbnb and tell them the situation and ask for their help. In this case, they offered to call the guest, and although it ended up the guest chose to cancel (probably after reading my house rules!) before Airbnb had to call, I would have had a legitimate reason to ask Airbnb to cancel on my behalf as these questions must be answered before booking with me.

So that is one thing you could look at doing - Make good use of those custom questions and try using IB - I would say it is definitely one of the reasons that I am always in the top 4 if you are looking at my specific Beach area. And I am pretty high up for the whole town I live in, too. And there are TONS of vacation rentals here. Hope this helps, Alicia!

[Alicia242]

Hi @Rebecca181 Something to consider for sure. And I am the same way I working within the wellness and alternative care even prior to that I have always been this way. I want good energy and vibes here only. No matter what walk of life they are from. What is the minimumn age airbnb allows people to book?  Thats a good point. I know Ive had on occasion a few couples here in the 20's. As long as they are quiet, clean, considerate and read the house rules etc Im fine with it my house rules state it is a quiet, safe, clean, cozy place for them to stay similar to a b&b it is not a party house. I suppose I could do that also. You are luck in that you have the seperate guesthouse. Its great because although I am clean if I do the instant book it will assure that I have the mail pile and little clutter piles away at all times haha. Im assuming you can still set for ex:  advance 12hr notice for instant book? ill check the rules as I am unfamiliar. This info is very helpful and appreciated. Im going to see if I can do a group msg amongst a few of us. I think many of you in this group chat have seprete homes you rent. My guests have there own bedroom and own bath in my townhouse altho there room is on the first 1st set apart from my 3rd fl. Master suite and bath. And there own bath is on the 2nd floor attached to the dining area which is where I offer coffee in the am. They can opt to use there own entry thru the garage also on the 1st fl if they want or enter thru the 2nd floor. I have a house rule after 9p and pre 8a all guests need to use that garage cut thru just so when Im ready to wind down I dont hear them come in. I ca hear a pin drop its awful haha.  If love to chat privately about a few more things so Ill stop rambling. Thanks for you time and info Best Alicia

[Rebecca181]

@Alicia242 if you look at Airbnb's Anti-discrimination policy it says to check your local jurisdiction and state laws or something like that regarding minimum age requirements. In most cases, if it is your own home, or if you own 5 or under units, you are exempt from many things that fall under various anti-discrimination policies under the Mrs Murphy exemption here in the United States.

You can set how much notice you need to accept a booking under Booking Policies - Look for 'Change Over Days'.

[Alicia242]

thank you I responded to this msg in our private msg I cant keep up here haha

[Dawn162]

@Matthew  During your airbnb experience have you ever not used a service?  If so did you see a big difference in bookings utilizing a service?  Did you see booking increase after reviews appearred? 

I've been keeping an eye on my 'neighbors' and have tried to stay in competition.  The prices are all over the place and some of it doesn't make sense.   I understand the places that are in close to everyone should be higher, but some of them are extreme.  (More os a B&B price.)   I just started on this venture.  As of today I have my first guest.  

[Matthew285]

@Dawn162 that's an excellent question!

I will try to answer it based on the limited data I have.

When we first started, we set our prices by hand. Our listing did really well right out of the gate (partly because of the "New" tag, partly because we are just in a high-demand city), so it isn't like we had a big problem to solve. We just had one price for any night (not even a different weekend price.)

After about 3 months, I activated the pricing robot, and we have been on that since. So keep in mind that my data set is quite small, and the time periods are entirely different parts of the year.

Price by hand: 78% occupancy, $4,240 revenue / month

Price by robot: 92% occupancy, $5,450 revenue / month

I really cannot say definitively that the increase in revenue is due to the pricing robot. They are entirely different parts of the year. Plus, as time goes forward, our number of good reviews increases, so it is easier to get bookings. 

But that is the data I have.

(If I were really pressed to judge, I would say the robot had a slightly slower time of year to fill.)

(The robot is definitely good at filling in last-minute vacancies.)

The robot costs us about $50/month (1% of bookings).

[Dawn162]

I've been surfing my competition and it shows they are not even 50% booked.  I'm just out of the gate and its been little over 30 days and I have 3 booking.  For this month I have a 3 night and a 12 night stay.  Next month I have a 5 night.  I changed my listing title since I do offer something nobody else does.  Even though you get a private room and bath, I offer two bedrooms to capture the two guest who need 2 bedrooms.  At this time I do not want to have two set of guest in my house.  (I do live here).  I keep playing with my rate as it goes up/down in the results.

[Matthew285]

 @Dawn162, your place looks terrific and seems to offer great value!

I think once your listing shows the great reviews from your first guests that more people will feel comfortable making a booking.

And I do like your new title.

[Rebecca181]

@Dawn162 Based on your questions here, I can tell that you will be VERY successful at this, as long as you understand how the search engines work, and how to stay up in the rankings. This Porter report @Matthew285 provided will save me HOURS of research a month, love it!

[Alicia242]

@Rebecca181 please share how the Search engine works and how to stay up in the rankings. You are so knowledgeable with this I am impressed 😄 

[Rebecca181]

@Alicia0 I read a good article on things you can do to stay up in the rankings - Many are related to stats, reviews, bookings, photo quality, frequent calendar updates, etc - If I find it I will pm it to you.

[Matthew285]

@Rebecca181 @Alicia242 @Dawn162 @Sarah977 I have some information I often post about the search rankings.

In my mind everyone has seen it already, but then I remember that might not be so.

Here is some info about search rankings I have gathered over time:

AirBnB is deliberately vague on how ranking is done. Here is their information page about it:

https://www.airbnb.com/help/article/39/what-factors-determine-how-my-listing-appears-in-search-resul...

Here is one AirbnB blog entry about search matching:

https://blog.atairbnb.com/how-search-makes-the-best-matches/

Here is a very informative AirBnB blog entry about how to rank higher (I think this one is the best):

https://blog.atairbnb.com/search/

Finally, here is a Reddit post where someone did a small bit of analysis about search ranking:

https://www.reddit.com/r/AirBnB/comments/6113kx/ranking_of_listing_factors_correlating_to_search/?st...

If you don't have time to read all the links, here are some highlights (in no particular order):

1. Instant Book: Very Helpful
2. SuperHost status: Not supposed to be a factor.
3. Being the kind of host that *is* a SuperHost: Definitely a factor.
4. Tweaking your listing every day: Not Helpful
5. Being put on lots of people's Wish Lists: Very Good
6. Getting clicked on (views): Good
7. Receiving inquiries: Good
8. Competitive price: Very Good.
9. Declining people’s booking requests: Bad
10. Positive Ratings from Guests: Good
11. Having lots of reviews: Good
12. Being a new listing: Very Good
13. Being responsive to guests: Good
14. Cancelling a confirmed booking: Very Bad

Also: be aware that the way the search results are ranked can vary from one guest to another. Just because you are high or low in the list for one guest doesn’t mean you will be in that position for ALL guests.