Pricing in Unprecedented Times

These are unprecedented times. Everyone and every industry has been affected. With no playbook on how to navigate a pandemic in the vacation rental industry, we have to stay laser focused on basics: keeping units rented for the most possible nights, for the highest amount possible per night. Dynamic pricing and revenue management are more important now than they have ever been. Despite decades of research and development and millions spent on developing pricing algorithms, airlines and hotel chains still practice “active revenue management.” This requires having revenue managers and pricing analysts constantly watch what the software suggests and make judgment calls on behalf of their businesses.

While it has always been important to stay on top of changes in supply and demand, right now is absolutely critical because it changes daily. In addition to supply and demand, many other factors also influence the market, such as fear, economic conditions, political climates, travel restrictions, and consumer confidence. It is important to remember that property managers do not determine the market. It is the traveler that sets the market, and we respond to it. An effective and responsible pricing strategy must be flexible, data-driven, and multi-dimensional. It cannot simply be to set the price of your unit $1 lower than your competition. Lowering prices can lead to a nasty price war that devalues the product and could take years to recover from.

As your property managers and partners, our revenue is directly related to your rental rates. Since we make a percentage of your nightly rental rate, our goal is always going to be to rent your property for the highest rate possible. We are using every tool at our disposal to ensure that we get the maximum revenue for you and for us.