As holiday home owners, we are all aware that to efficiently optimize revenue, we need to take advantage of customized pricing according to the different seasons and even guests’ requirements. However, this process can get a little tricky sometimes, and end up affecting your listing performance rather than helping it!
As such, it is important to understand the pricing options that you currently have on HomeAway, as well as how to avoid the two most common mistakes that our owners tend to make and how to avoid them!
HomeAway’s Pricing Options:
1) Long-term Pricing: “Edit Listing -> Pricing and Terms”
On top of setting your basic rates, you can apply a long-term price applicable for weekly (7 nights or more) or monthly (28 nights or more) reservations. This option allows you to offer discounted prices to encourage longer stays.
For additional nights beyond a week or a month, a pro-rated nightly rate will be applied based on the long-term price that you set.
2) “Custom Weekly / Monthly Pricing”: “Edit Listing -> Advanced”
You also have the option of setting custom weekly or monthly pricing, for when you are targeting specific periods where there is a special festival or event happening in your location. This option is also useful for specific peak seasons like summer or the end-of-year holidays.
This custom weekly price will override any nightly or monthly price you’ve set, as well as any custom pricing on specific calendar dates.
3) Last Minute Deals & Special Discounts: “Edit Listing -> Discounts”
Using our ‘Last Minute Deal’ feature allows you to target last-minute travellers to fill out the gaps between your available nights. It is also important to note that listings with last minute deals are usually highlighted and boosted to the top of search results pages, to increase exposure to travellers searching for accommodation within the next 7 days.
Our Special Discount tool is a popular one with hosts as it allows you to create special offers and promotions at any time, and for any travel period, which helps to drive more exposure and inquiries depending on traveller search dates. While a ‘Last Minute Deal’ requires a minimum 15% discount, there is not minimum rate required for a Special Discount.
Now that you are clear on your options, let’s have a look at some common mistakes our hosts have made, and how to avoid them!
- SETTING YOUR PRICING IN THE INCORRECT FIELDSIt’s a simple mistake, but it happens all the time. Some hosts get confused while setting different pricing, and more often than not, you may end up inputting the wrong amounts into the wrong fields! This results in nasty surprises and complications for hosts when they have to reject or cancel a booking request. You should always note that your basic nightly price should go into the field below:
And NOT in the ‘Advanced -> Custom Pricing’ field as shown below:
As custom pricing will always override your basic nightly prices, be mindful of this when you plan to utilize your custom pricing to ensure that your listing displays the correct amount.
You want to take advantage of the peak summer season between the months of June – August to earn more.
You should input the revised pricing ONLY for the months/weeks to avoid overriding the prices for the rest of the year.
Not doing this may result in your prices being higher than your competitors for the rest of the year, and not attracting enough traveller inquiries!
OVERLOOKING THE OVERLAP PERIODS OF CUSTOM PRICES AND LONG-TERM PRICES
While our Custom weekly / monthly pricing is useful to increase profit during peak seasons and special holidays, you will need to be careful to also adjust your long-term prices to avoid the risk of missing out on peak season prices. Forgetting to do this usually results in a conflict between hosts and travellers over the final amount to be paid.Custom fees are set according to specific weeks or months – so if a traveller books for an accommodation period that goes beyond your custom prices, your long-term or basic nightly pricing will kick into effect instead. Depending on your settings, this may mean that you may suffer a deficit in your overall income from the period of stay.For example:
It’s the end-of-year peak season. Your long-term weekly pricing is already set to a default of USD$1,260.
However, to maximise your revenue for the peak season, you have also adjusted your custom weekly price for the Christmas & New Year period between 25 December – 7 January (2 weeks) to USD$2,100.
A traveller then books a stay in your property for 14 nights from 31 Dec – 12 January. Based on your current price settings, you are set to receive USD$3,120 for the entire stay.
Breakdown of USD$3,120:
31 December: USD$300 (based on custom pricing of USD$2,100 for 7 nights)
1 – 7 January: USD$2,100
8 – 12 January: USD$720 (based on basic nightly price of USD$200 * 4 nights)
Missed peak season revenue: USD$480
As you can see, because your long-term weekly price was not adjusted, you have missed out on some important revenue. So do keep this in mind when you set your seasonal prices!