Every now and then I get these emails from Airbnb telling me to "Turn lookers into bookers" and they provide examples of places nearby that got guests for X amount less per night than I charge. That X amount is usually considerably lower than my very reasonable price, sometimes up to 40% lower.
Honestly, I don't want to be compared to places that are so cheap, because the reality is that cheap guests come at a price that is not worth my efforts. Whemever I have lowered my price to suit the Airbnb search algorithm I end up getting less than stellar guests and I really don't want them. Almost every guest I have had with any Airbnb experience tells me that our place is the best value they have ever found. Why can't Airbnb see that?
Their algorythms are just bots with no emotion.
Lower prices means more occupancy and more revenue for Airbnb from the guest side.
Cheski claims smart pricing hosts get 25% more occupancy. It doesnt take a genius to work out that if you have to drop you price by 30% to entertain that then this happens....
Example: Your set price 15 nights booked per month at 50 dollars = $750
Smart pricing with 30% discount but an increase of 25% occupany would be 19 nights at $35 = $665
Leaving you with more cleaning bills and time spent dealing with guests and a loss of -$85
And we need a computer to tell us we would be better off?
Leave it out and go do the math, stick to what you feel is the right price!
It's exactly what I though. If you low your price and get more booking you will have more utility bills, and I do not mention the time waisted on cleaning, the more utility bills on washing the linens and providing soap, condiments, coffee... As a result, I'm making more money and work less with fewer bookings. I see some hosts in my area who are very cheap, and for the same apartment that I rent, I'm wondering if they can do the math and realize the very few money they get. I won't put my apartment on sale because I have a couple of hosts in my area who are doing so. Instead ,I let the cheap people or the early birds to book with them, then they have to pay the right price for my condo or other host who don't rent their place for peanuts. In addition, when I started Airbnb I was cheaper, and cheaper you rent your place, worst are the guests with attidue, and they are expecting everything for free! They also are willing to give you 3 stars even if the cheap outdated motel in the neighborhood costs more! I don't need and don't want this type of guests. The guests who are willing to pay the correct price will respect your place better and most of the time delighted with everything.
My favorite story goes like this. I had two days there were open and it was two days away. Airbnb sent me a message suggesting I lower my price to book these days. I immediately raised the price by 15% and 10 minutes later the days booked. My philosophy is if they tell me to lower my prices, it really means to increase my prices.
So things were quiet and I thought I would lower my price a little. Lo and behold not even a day went by and I had 2 bookings. The first one was a good guest, but the next one was a pig.
I think it's fair to say that if you're going to drop your price you are also going to open yourself up to these bad guests. I'm not going to do it again. If I get no bookings then that's actually fine with me.
Airbnb can go and get knotted.
Exact same emails are sent to me often. We are priced well above the bottom priced places and slightly below the crazy priced places. AirBnB's computers do not take into account amenities or overall charm/experience of your place. We are a farm experience where you get the entire farm house and have horses and cattle wandering by all day. We have a campfire area by the pond and allow fishing for BlueGil and Catfish. So, I don't think we should be compared to the 1970's home in a neighborhood with crappy furniture for $125 a night. We are at $240 per night. However, I have different pricing all over the calendar. I don't need smartpricing to tell me that Holidays should be more. In fact, smartpricing won't do that. So far every guest we have had are raving fans and we have had a few stay two and three times since March of this year (our first month in business). I do enjoy the AirBnB interface and the calendar. I like how they collect the taxes and pay them. The system works great for me. I just ignore the pricing suggestions.