Last winter I spent a lot of off-season time drilling down into my nightly prices, seeing what had worked best over four years of hosting. I came up with a “sweet spot” for each of the three listings and set that number as the minimum with Smart Pricing.
My prices were already higher than most of my competitors. But here’s the long story short:
*by May, my booked income for 2019 was 100% of my booked income for 2018
*overall income for the year so far has now increased 25%
*number of nights booked has gone up 13%
*average nightly price across three listings has gone up 10%
*at this point last year, I had 34 bookings; this year so far, I have 68 bookings.
Before using Smart Pricing, I looked into Beyond Pricing. (Wheelhouse is not available in my area.) Their demo showed that, on average, they would be charging less than I was already charging. So I decided to try Smart Pricing, which many hosts hate. They hate it because it “tells them” to set a lower minimum price than they want to charge. But if you SET YOUR MINIMUM AT WHAT YOU WOULD NORMALLY CHARGE, rates will go up dynamically.
And by adding the Smart Pricing tool to Instant Book, I found my listings rose dramatically in the rankings. I signed on with Rank Breeze and found that they were almost always on the first page.
*after a few months, I found that even when I used Airbnb’s suggested minimum, Smart Pricing set most nights at my “sweet spot” rate – showing me that the algo drew the same conclusion I had drawn. However, I never left it at the minimum rate for more than a few minutes! :)
*Smart Pricing’s suggested maximum changes often, and I always use their suggestion for the maximum, even though my prices have never hit the maximum.
*in an effort to keep the listings fresh and drive them up the rankings, many of us make changes regularly. Changing or adding photos doesn’t update the listing, but changing ONE LETTER of the listing description does.
*when your prices are up, you might get a suggestion to send out a special discount offer for a period of days. In the off season, I always did that, because Airbnb sends an email with the offer out to people searching those dates. It mattered less to me that I got bookings than that I got more eyes and clicks. And more eyes and clicks raises you in the rankings.
It seems like your listing will get more favorable treatment the more Airbnb tools you use. I know there are a lot of Smart Pricing haters out there, but why not give it a try, making sure you always use your own minimum, and see what happens?
@Ricardo86 I think that is the case. You can try to do the following to confirm it.
(1) Turn on Smart Pricing
(2) Try to create a rule sets. And I think that somewhere you will see a message that rule sets does not work with Smart Pricing.
It depends how far you want to go and how far actually you can go.
In my area, you can't pay a mortgage with hosting. With some luck, you can get closer to a normal rental income, what means 60-70% of the mortgage price. Maximum. Average will be lower than 50%. But the risk of being a host is many times lower than the risk of being a landlord. It is a normal, common situation for tenants to escape without paying their household bills. Especially if your home has a central heating-all bills for the heating season (it ends on 01 April) comes near the middle of September or October. Even a deposit of two rents will not be enough sometimes. It happened to me 5 years ago. Total loss was near 1500$. The rental price-250$/month for a 950 sq. feet condo. So, my goal is to be close to the average rental income, but without the risk of being a landlord. If I lower the price, my listing will start to attract local individuals. The same, that I'm trying to avoid, using ABB . In some situations, money may not justify the risk. And the balance between them lays on a very thin line.
@Dimitar30 I know exactly what you mean. In my area (rural Maine) I would never be able to find a local to rent the house at the right price year-round. Plus the wear and tear would be expensive. I don't like to lower my price because I know what all my costs are. If it's true, as those messages about price claim, that you'll get more bookings at a lower price, I don't want them. Twice as many bookings at half the price mean the boiler gets used twice as much, the linens are washed twice as much, the appliances are used twice as much, etc. etc. etc. - and for half the price, it's not worth it. So I keep the prices high and wait. Using Smart Pricing this year pushed the prices up and attracted more bookings than ever before.
We use smart pricing, but do set our own minimum. It’s also worked out well for us, we’ve had a number of bookings for more than we would have normally charged this summer. Haven’t played around with increasing them around busy times yet though.
Did you set on Instant book and smart pricing ON almost at the same time?
Maybe it was the instant book feature that caused the stats to go up.
Once in while I used to set smart pricing on during low season.
However, to me, the biggest problem with smart pricing is that rule-sets can not work with smart pricing on.
The rules sets is very important to me to configure dates when I dont want to allow checkin, checkout and both on a some nights. It is very important when dates goes through expensive holiday dates.
So I do not want someone booking partially some dates and break a sequence of days that covers expensive holiday dates.
Rule sets to me is also important to charge a higher price for a shorter period of time (such as 2 or 3 nights minimum stay), even during low season.
I'm confused by this . . . . . . I have smart pricing on and use rule sets all the time. Although the rule sets have to do with minimum night stays and no check out/in days (and not prices) but they still work with Smart pricing turned on. You guys are obviously experiencing something different?
@Emilia42 You're right - pricing rule sets don't work with Smart Pricing. In order to avoid having to manually change the prices for the top holiday weekends, I tried to make a rule set that would raise the price by a certain percentage for certain dates. Didn't work and I found out that it won't work if you have Smart Pricing turned on. But it appears rule sets that are only about days and times will work.
The rule-sets we are talking about are the ones that you have to activate them. They are not available by default.
You can read about them by clicking on the following link:
@J Renato Ah, I see. I am using the rules sets that do not affect price like minimum stay requirements or not allowing check in/out day. Smart Pricing does not affect those rule sets apparently. And I set length of stay discounts through the 'availability' page so that is not affected either.
I have just set smatpricing ON using rules-set
I am somewhat confused now. However I think it is a good surprise anyway.
What I have noticed is like that:
1- The rules-set does not affect the price (with smart pricing ON)
2- The rules-set still affect Trip length requirements: the minimum and maximum number of nights set that guests can book
2- The rules-set still affect Check-in and checkout requirements: the days set that guests can check in and out or can NOT have checkin or checkout and whatsoever.