Smart Pricing & Quality of Guest Observation

[Greg6]

Greetings from the San Francisco Bay Area! To preface, we are long-time superhosts for a 1bd private apartment at our home outside of San Francisco. It's been overwhelmingly a great experience, hosting people from near and far. With very few exceptions, our home and rules have been respected. Historically, our per-night rate was set at ~135.00, with two night minimum, plus a 50.00 cleaning fee and 250.00 security deposit. We have, on average, about 100 bookings per year. Rarely would a guest cancel (I can think of 2 instances in four years.)

This past October, I tried out the new "smart pricing" feature. I set the low threshold to 110.00, and the high, at 140.00. We had an immediate uptick in booking requests during the slowest time of the year; winter. Since November, we've had 3 last-minute cancellations, the apartment is now being left in disarray, guests book for one, but bring more (unit sleeps 4). Check-out times are violated, small parties are being held, despite a strict no-party policy that is communicated clearly in advance.

After the experience with our current guest and her steady stream of friends at all hours (thankfully, the unit has a private entrance), I have returned our pricing to where it was, made our cancellation policy 'strict', and am revising our rules and how they are presented. 

Basically, I have to say, our experience has suffered at the expense of "Smart Pricing"... I now have about 5 or 6 more guests who booked this way, and then we should be back to normal. Has anyone experienced the same?

[Tracey207]

Yes! Exactly what you are describing! It was the worst thing ever...lower price, lower quality guests...I guess??

The issue though, is their smart pricing tool is consistently too low for many areas. It was pricing me sometimes cheaper than a 2 br...when I have 4.

The difference in guests was astounding. I’ve since looked into it and abb smart pricing isn’t highly liked or used. There are external softwares you can use that do the same and are more dynamic not to mention accurate in their pricing.

[Ann72]

@Greg6, that sounds bad!  My question is, why did you set the minimum at a lower rate than you would charge?  I turned on smart pricing this winter in advance of the summer season in Maine, and set the minimum at what I would normally charge (and the maximum at their reco).  The calendar shows that the price goes up over the high season.  I've had several bookings at the new higher price and all but one of them are returning guests, so I'm not worried about what they'll be like.  But good to keep an eye on it.  And never forget the conundrum that lower prices mean worse guests - I don't know why!

[Patricia2006]

Yes, I  totally agree.  I am in the Las Vegas area, and the smart pricing cost less than the hotel resort fees so common here. I only have a guest room with private bathroom, a gueen size memory foam bed, a new TV with Netflix, WiFi, pool small fridge, laundry room, continental breakfast, office etc. In The Green Valley area and the smart price was $22.  I  am new (only 2 mos.into, but am being shown being 1 year, which makes me appear to be not doing well.  I have had to cancel four guest. After these guest pay a cheap price, you start getting messages from them wanting to bring other guest for a few days, or checking in at any time they want to save money on air ticket.  Now I am charging more, to get better quality.  I stayed up until 2am for a late check in, and guess what, I am still waiting for her review.