Dynamic Pricing for Vacation Rentals Helps You Earn More
Vello is all about ensuring that our vacation rental property owners get the most bang for their buck from their rental investments, and one of the best ways to do that is to hit the "Goldilocks zone" of pricing. Our dynamic pricing technology allows us to price our clients' properties in the price range that maximizes profit while leading to a stable flow of interested guests.
If you want to know more about Vello's vacation rental management process, follow along as we explain the nuts and bolts of our dynamic pricing system.
How Dynamic Pricing Works
One of the trickiest aspects of running a short-term rental business is gauging demand for vacation homes and changing your pricing accordingly. Fortunately, technological innovations (including machine learning) have made it possible for modern-day companies to offer smarter, more flexible vacation home pricing.
Vello's dynamic pricing system uses machine learning to track short-term rental rates throughout the day. As demand rises or falls, Vello raises or lowers the price of your specific property to match what consumers are looking for.
In addition, our dynamic pricing tool knows when to raise rates during peak times (such as on holidays or during popular local events like concerts) or when to lower them as necessary to make sure bookings don't slow down due to inflated rates.
With our system making use of insights gained from millions of data points, Vello is able to make sure you have the right price point at the perfect time, outshining rental properties that still rely on fixed prices.
Developing a Personal Pricing Strategy
Depending on the way you like to do business, you may decide to pursue either more conservative pricing strategies or act more aggressively when pricing your vacation home. The beauty of Vello's AI-driven dynamic pricing is that you can learn which pricing model works well for your area and gets you the biggest return on investment.
By analyzing the rates, location, and other key factors of the competition, our advanced pricing models will make sure that your property's rates stay competitive while also being faithful to your preferred revenue strategies.
Flexible Adjustments for Optimal Timeframes
In addition to factoring in overall demand and your personal pricing expectations, our dynamic pricing software also makes use of the bigger picture represented by your local rental market. By taking into account how fast vacation homes in your area are booked, as well as historic and current prices for your short-term rental property and its competing neighbors, we can adjust the rate to get you the biggest profit.
The system can also adjust the booking window for your Airbnb property, meaning the length of time guests have in advance to book will shift depending on whether or not you're facing peak demand. During peak seasons, our system will shrink your booking window, allowing you to wait for a higher rate rather than booking too early (such as months in advance) and missing out on a higher price point.
Real-Time Data from Your Local Market
No matter where your vacation home is located, our intelligent pricing strategy can set the right listing price for your area through the use of real-time market data.
By taking into account local market demand, historic rental performance, the effects of seasonality on short-term rental prices, and other key data points, our dynamic pricing will allow your property to compete with local rivals while maintaining a high enough price point to still turn a profit and make booking guests worth your while.
Growth Performance for Long-Term Profitability
The key to success in the vacation rental business is playing the long game. In other words, you need to focus not just on higher daily or nightly rates, but on netting higher annual revenues. By charging the smartest rate for your area and season, you'll get a better return in the long run.
For instance, our dynamic pricing structure can lower a rate just enough to turn a two-night visit into a four-night stay, or how much to alter your occupancy rate to complete more bookings during the off-season. These little wins add up over time, meaning more happy customers and more revenue over the long haul.
Dynamic Pricing FAQs
Which variables affect your strategic pricing?
As discussed above, our dynamic pricing recommendations take several factors into account. These include seasonality, major holidays and local events, pricing of competitor properties, average occupancy rates, regional demand, overall market supply, and ongoing discounts in your area.
How do I increase my rental revenues?
There are many tips you could put into action, but there are some easy ones to implement right away. Allowing pets at your property will set you apart from the competition, as will installing amenities that give you the chance to use premium pricing (e.g. hot tubs or Jacuzzis). Increasing sleeping capacity is another great way to generate additional revenue from your vacation home.
Contact Us Today!
If you want to try out our dynamic pricing on your short-term rental property, we'd love to talk with you. Schedule a consultation with our expert team and find out how we can put our process to work for you!
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