Post by High Priestess on Oct 5, 2015 1:45:48 GMT
Stephanie and Steven shared in AUgust 2015
Price Tips
We just got an email chastising us for the fact that our prices have only matched up with airbnb's suggestions twelve per cent of the time and suggesting, if we want to make more money we should take their pricing advice.
We're booked 80 per cent of the time. I am busier than I'd ever hoped to be and airbnb's price tips sometimes suggest our prices are 900 percent more than they should be. They recommended $10. a night for a newly renovated two-bedroom suite in a town where the Holiday Inn charges $200 a night for a room. (Sorry airbnb, I won't let you sleep on my porch for $10 a night, much less change your bed and let you use my bathroom. It's not going to happen.)
In my opinion, anyone with a lick of sense is ignoring the airbnb pricing tips but I do wonder if they've been of any use to anyone else?
Eric:
Too funny! The price tips have been about as useful as a chocolate tea pot for us too. I do a weekly price audit of my competition which serves me well. Good luck with your hosting. Rgds, Eric
Benoît:
On my side it wasn't as bad as you described. Airbnb offered to decrease a bit the price because of low bookings in the region during June. And since I had absolutely no booking, I agreed. But well I finally had no booking in June. Neither in July!
Rebecca:
Seriously? You got an email chastising you about this? That's crazy. They are supposed to be 'tips' not something to be enforced. I haven't used this service. Usually the tips say I'm too cheap but the algorithm (or whatever) hasn't seen the state of the partially renovated bathroom and kitchen... Then in August it told me I was too expensive. But it didn't know that this month is the Edinburgh International Festival when the city's population trebles and I could probably list a pile of cushions under the dining table and somebody would pay for it.
Having said that, I read on one of the groups that somebody was having success with it. I would be too nervous to charge the amount they are suggesting. Because then I would be chastised for having low ratings on Value... *rolls eyes*
Bekah and Brian:
I don't believe in dynamic pricing. It just rubs me wrong, so I don't follow the tips at all. I do know hosts who seem to be doing okay with 3rd party pricing sites, but it's just not for me. I'm booked plenty with the prices I have, so that's what I'll keep doing.
Tara:
My basic nightly price is GBP130 (USD200) for an entire 1-bed flat in *very* central London. It's less than most hosts charge for a similar quality place and some charge almost as much just for a room in the same location.
Anyway, price tips often suggest I charge more, often way too much. Okay, but I don't want to. I'm happy being fully booked and good value. Competitive pricing/greater demand also means the freedom pick and choose guests who chime with me (important to me even though I'm not sharing a space with them, I still want to be dealing with civilized guests).
Then the other day the price tipper suggested I charge GBP83 for one night - it's a crazy low price, bears no relationship to reality. There was an additional price tip message saying:
"1. You have back to back reservations. Guests are less likely to book dates wedged between other reservations
2. Your price is much higher than similar listings [etc]"
Pure bollocks on both counts. 1. I've been a guest several times and don't care so long as my dates are actually available, and 2. My price is *NOT* much higher than similar listings, it's lower.
So at that point I realized Airbnb price tips are a joke - as reliable as Airbnb search algorithms, as reliable as Airbnb stats, - in short, it's based on the most primitive equations as far as one can gather. Reality doesn't get a look in.
Rebecca:
Yes, that "Guests are less likely to book dates wedged between other reservations" struck me as really weird. Actually, bollocks is more accurate as you say. It reminded me of that site where you can show correlations between anything and everything. It might as well have said 'guests are more likely to book at this price if the price of carrots increased'. But hey, some (not so) bright spark with get his/her PhD in Statistics and Marketing thanks to this piece of crap. Yay!
Keith:
Agree this is silly. I get quite a few 1 and 2 night bookings. They fill the gaps nicely and if not I enjoy a day of solitude.
Alex:
Yeah, the price tips are pretty horrible. I'm booked at 95% capacity at $80-$110 a night. Price Tips wants me to lower my rate to $30.... pass.
Keith:
I use everbooked for pricing.
heres a link to a free 90 day trial:
bit.ly/1SORLRK
if it's available in your area it's great, automates pricing relative to other airbnb and hotels and activities in the area.
AirBnB's price tips require too much manual effort... I've yet to receive such a letter.
I'm actually glad they're taking a stronger stance on pricing. I've complained to them about their marketing airbnb has a value offering.. What most of us provide is worth more than a hotel, yet the perception is that we should be 1/2 or 1/4 the price of a hotel. This makes no sense. So they have some work to do on their messaging, but I think they're headed in the right direction.
Keith:
One more thought on capacity. if you're >90% booked or booked up more than a month in advance (depending on your location), this is likely an indication that you're under priced.
I talked to a host that was booked 3 months ahead always.. she doubled her prices and was booked 75 % of the time. .so her net revenue went up and her work effort went down.
if you're hosting to have company around, then go for lower pricing, but if you need the income, then charge more appropriately.
Rebecca:
That's very interesting, Keith, thanks. It looks like I might be a bit under priced according to that theory. Was is the rationale behind it, though? I read somewhere that the overall average time that guests book is six weeks in advance and that is generally my experience. These are people planning their vacation in good time or keen to get a place well in advance when demand will be high (due to a major event happening, for example). I'm not at all disputing what you say, by the way! I'm just intrigued by the rationale. I'm guessing the clue is in the "depending on your location" caveat?
Rebecca:
' *What* is the rationale' obviously. Do wish we could edit posts.
Keith:
If your bookings are happening with the average lead time then your prices are probably average. If you get bookings well in advance then your under priced. I tend to get some bookings a month ahead and most within 2 weeks. Total occupancy is lower than last year but total revenue is higher so its perfect for me. You have to find a strategy that best fits your comfort zone.
Rebecca:
OK but you still haven't given a rationale for the theory, Keith.....! No worries
I'm comfortable with what I'm doing and it seems to work well for me so it's all good, like you say. I would rather earn less than risk guests not being satisfied over value, I don't need that stress. I'm very upfront about the limitations of my place and so far there's been no major complaints and I love my budget travellers. I have increased prices steadily over the three years since I started and have no intention of dropping them.
Stephanie and Steven:
They've rarely suggested we raise our prices but have, instead, frequently suggested we are charging too much. At $105 a night for a two bedroom suite with a panoramic view, in a town where the Holiday Inn charges $189 a night for a basic room, that is patently absurd.
The next closest thing to us is an upscale hotel that uses a similar design aesthetic and charges upwards of $300 a night on a noisy street in a dicey part of town with no breakfast and no view.
Keith - the overpriced suggestions seem to be motived by something else entirely, I am wondering, if anyone knows, what could possibly motivate airbnb to suggest I drop my price to $30 a night or even $10. (which they have done) It is just insulting.
p.s. - not interested in any programs to set my price for me. I keep tabs on every available lodging in our area and know, perfectly well, what people will pay and what they won't (or shouldn't) pay.
A computer program doesn't know our town. And it irks me that airbnb presumes to lay down these heavy handed "suggestions" when clearly, they have no clue about our area either.
Plus there is the fact that we are booked - sometimes two weeks in advance, sometimes two months in advance but always booked to my satisfaction. 80 per cent of the time is all I can handle. We had three weeks there when I didn't get a day off and it was exhausting. Plus - my garden missed me.
Zena:
I have used this feature only once which was lower than my published nightly rate when I had a 2-week gap in the month. I had an immediate instant booking. However, I wouldn't use it again because the suggested prices would seem like I am lowering my standards.
Price Tips
We just got an email chastising us for the fact that our prices have only matched up with airbnb's suggestions twelve per cent of the time and suggesting, if we want to make more money we should take their pricing advice.
We're booked 80 per cent of the time. I am busier than I'd ever hoped to be and airbnb's price tips sometimes suggest our prices are 900 percent more than they should be. They recommended $10. a night for a newly renovated two-bedroom suite in a town where the Holiday Inn charges $200 a night for a room. (Sorry airbnb, I won't let you sleep on my porch for $10 a night, much less change your bed and let you use my bathroom. It's not going to happen.)
In my opinion, anyone with a lick of sense is ignoring the airbnb pricing tips but I do wonder if they've been of any use to anyone else?
Eric:
Too funny! The price tips have been about as useful as a chocolate tea pot for us too. I do a weekly price audit of my competition which serves me well. Good luck with your hosting. Rgds, Eric
Benoît:
On my side it wasn't as bad as you described. Airbnb offered to decrease a bit the price because of low bookings in the region during June. And since I had absolutely no booking, I agreed. But well I finally had no booking in June. Neither in July!
Rebecca:
Seriously? You got an email chastising you about this? That's crazy. They are supposed to be 'tips' not something to be enforced. I haven't used this service. Usually the tips say I'm too cheap but the algorithm (or whatever) hasn't seen the state of the partially renovated bathroom and kitchen... Then in August it told me I was too expensive. But it didn't know that this month is the Edinburgh International Festival when the city's population trebles and I could probably list a pile of cushions under the dining table and somebody would pay for it.
Having said that, I read on one of the groups that somebody was having success with it. I would be too nervous to charge the amount they are suggesting. Because then I would be chastised for having low ratings on Value... *rolls eyes*
Bekah and Brian:
I don't believe in dynamic pricing. It just rubs me wrong, so I don't follow the tips at all. I do know hosts who seem to be doing okay with 3rd party pricing sites, but it's just not for me. I'm booked plenty with the prices I have, so that's what I'll keep doing.
Tara:
My basic nightly price is GBP130 (USD200) for an entire 1-bed flat in *very* central London. It's less than most hosts charge for a similar quality place and some charge almost as much just for a room in the same location.
Anyway, price tips often suggest I charge more, often way too much. Okay, but I don't want to. I'm happy being fully booked and good value. Competitive pricing/greater demand also means the freedom pick and choose guests who chime with me (important to me even though I'm not sharing a space with them, I still want to be dealing with civilized guests).
Then the other day the price tipper suggested I charge GBP83 for one night - it's a crazy low price, bears no relationship to reality. There was an additional price tip message saying:
"1. You have back to back reservations. Guests are less likely to book dates wedged between other reservations
2. Your price is much higher than similar listings [etc]"
Pure bollocks on both counts. 1. I've been a guest several times and don't care so long as my dates are actually available, and 2. My price is *NOT* much higher than similar listings, it's lower.
So at that point I realized Airbnb price tips are a joke - as reliable as Airbnb search algorithms, as reliable as Airbnb stats, - in short, it's based on the most primitive equations as far as one can gather. Reality doesn't get a look in.
Rebecca:
Yes, that "Guests are less likely to book dates wedged between other reservations" struck me as really weird. Actually, bollocks is more accurate as you say. It reminded me of that site where you can show correlations between anything and everything. It might as well have said 'guests are more likely to book at this price if the price of carrots increased'. But hey, some (not so) bright spark with get his/her PhD in Statistics and Marketing thanks to this piece of crap. Yay!
Keith:
Agree this is silly. I get quite a few 1 and 2 night bookings. They fill the gaps nicely and if not I enjoy a day of solitude.
Alex:
Yeah, the price tips are pretty horrible. I'm booked at 95% capacity at $80-$110 a night. Price Tips wants me to lower my rate to $30.... pass.
Keith:
I use everbooked for pricing.
heres a link to a free 90 day trial:
bit.ly/1SORLRK
if it's available in your area it's great, automates pricing relative to other airbnb and hotels and activities in the area.
AirBnB's price tips require too much manual effort... I've yet to receive such a letter.
I'm actually glad they're taking a stronger stance on pricing. I've complained to them about their marketing airbnb has a value offering.. What most of us provide is worth more than a hotel, yet the perception is that we should be 1/2 or 1/4 the price of a hotel. This makes no sense. So they have some work to do on their messaging, but I think they're headed in the right direction.
Keith:
One more thought on capacity. if you're >90% booked or booked up more than a month in advance (depending on your location), this is likely an indication that you're under priced.
I talked to a host that was booked 3 months ahead always.. she doubled her prices and was booked 75 % of the time. .so her net revenue went up and her work effort went down.
if you're hosting to have company around, then go for lower pricing, but if you need the income, then charge more appropriately.
Rebecca:
That's very interesting, Keith, thanks. It looks like I might be a bit under priced according to that theory. Was is the rationale behind it, though? I read somewhere that the overall average time that guests book is six weeks in advance and that is generally my experience. These are people planning their vacation in good time or keen to get a place well in advance when demand will be high (due to a major event happening, for example). I'm not at all disputing what you say, by the way! I'm just intrigued by the rationale. I'm guessing the clue is in the "depending on your location" caveat?
Rebecca:
' *What* is the rationale' obviously. Do wish we could edit posts.
Keith:
If your bookings are happening with the average lead time then your prices are probably average. If you get bookings well in advance then your under priced. I tend to get some bookings a month ahead and most within 2 weeks. Total occupancy is lower than last year but total revenue is higher so its perfect for me. You have to find a strategy that best fits your comfort zone.
Rebecca:
OK but you still haven't given a rationale for the theory, Keith.....! No worries
I'm comfortable with what I'm doing and it seems to work well for me so it's all good, like you say. I would rather earn less than risk guests not being satisfied over value, I don't need that stress. I'm very upfront about the limitations of my place and so far there's been no major complaints and I love my budget travellers. I have increased prices steadily over the three years since I started and have no intention of dropping them.Stephanie and Steven:
They've rarely suggested we raise our prices but have, instead, frequently suggested we are charging too much. At $105 a night for a two bedroom suite with a panoramic view, in a town where the Holiday Inn charges $189 a night for a basic room, that is patently absurd.
The next closest thing to us is an upscale hotel that uses a similar design aesthetic and charges upwards of $300 a night on a noisy street in a dicey part of town with no breakfast and no view.
Keith - the overpriced suggestions seem to be motived by something else entirely, I am wondering, if anyone knows, what could possibly motivate airbnb to suggest I drop my price to $30 a night or even $10. (which they have done) It is just insulting.
p.s. - not interested in any programs to set my price for me. I keep tabs on every available lodging in our area and know, perfectly well, what people will pay and what they won't (or shouldn't) pay.
A computer program doesn't know our town. And it irks me that airbnb presumes to lay down these heavy handed "suggestions" when clearly, they have no clue about our area either.
Plus there is the fact that we are booked - sometimes two weeks in advance, sometimes two months in advance but always booked to my satisfaction. 80 per cent of the time is all I can handle. We had three weeks there when I didn't get a day off and it was exhausting. Plus - my garden missed me.
Zena:
I have used this feature only once which was lower than my published nightly rate when I had a 2-week gap in the month. I had an immediate instant booking. However, I wouldn't use it again because the suggested prices would seem like I am lowering my standards.