The Art of Dynamic Pricing
February 16, 2021
Vacation rental managers tend to let out a big sigh at the mere mention of PRICING, one of the most time-consuming headaches VRMs face if they’re yet to automate. Every vacation destination, rental home, and guest stay is unique, and as demand changes, so should your pricing. In a competitive market, many factors come into play when pricing your property – seasonality and local events, arrival date and length of stay, past bookings, property reviews, and current demand. It’s a mission impossible if you’re still on manual pricing!
You can transform your vacation rental pricing with dynamic pricing tools and software. As the vacation market becomes more competitive and pricing strategies, revenue management, and VR technology continue to evolve, dynamic pricing remains a vacation rental buzzword. The advanced pricing software uses algorithms to analyze the current market trends and real-time data to determine the demand and supply in your specific vacation rental market, then sets an optimal nightly rate. As the market becomes more favorable, so the nightly rates rise, automatically!
Rented, a leading revenue management partner for vacation rental professionals, recently announced the launch of Art, the latest automated rate tool and dynamic pricing software to enter the vacation rental market.
Rented founder and CEO, Andrew McConnell, said: “We’ve always believed that vacation rental pricing requires a blend of art and science. Our full-service clients have hired us because set-it-and-forget-it pricing tools don’t typically work for destination markets, where most properties are unique and relevant pricing data is hard to surface”.
Art is designed to allow short-term property managers to set competitive pricing for every property, every night. Their advanced pricing models focus not only on historical data, most of which is no longer relevant due to COVID-19 but on-demand and availability.
“Art is a way to get you as close as possible to fully automated rates for your property taking into consideration the demand for the particular property you are pricing, relative to the market.” Cliff Johnson of Rented states in a recent Art demo.
Art has an easy to use interface, delivers market-driven pricing recommendations, and integrates with your PMS to update dynamic pricing across all online marketing channels. Every property is treated as unique with customizable settings. You can set your base rate, minimum and maximum rates, market sensitivity, and revenue goals per property.
Colorado-based PMI Summit has implemented Art with rave reviews. Vice-president Shana Lewis said: “Thus far, it has been one of the best pricing tools I have used, and I’ve played with a lot of them. The product data being produced and used to generate pricing is more realistic—it doesn’t just bottom-out at the lowest dollar.”
The Benefits of Dynamic Pricing
Dynamic pricing is an effective tool to add to your vacation rental technology toolbox. While many property managers and homeowners still remain hesitant, the data shows that the advantages of switching to dynamic pricing are many.
- Enhance the Customer Experience: Pricing is one of the most influencing factors in the guest experience. Understanding how and why your guests’ book, anticipating their needs, and offering competitive pricing takes the customer experience (CX) to the next level.
- Save Time: Time is a luxury most vacation rental industry professionals don’t have! Investing in reputable dynamic pricing software and automating your pricing saves countless hours. Hours you can now invest in other creative business strategies.
- Stay in Control: You have complete control! Dynamic pricing tools and software allow you to set the rules to manage your pricing and stay in complete control of your nightly rates.
- Stay Competitive: Dynamic pricing analyzes your specific rental market in real-time and delivers data-driven insights right to your fingertips. Stay ahead of the game, set your pricing right, and stay viable in a competitive market.
- Price Confidently: Dynamic pricing enables you to offer your guests the right price at the right time. Pricing too low hurts your margin, pricing too high turns guests away, data-driven dynamic pricing allows you to price confidently.
- Maximize Revenue Growth: Research shows that data-driven dynamic pricing and smart revenue management maximizes occupancy and drives revenue growth. Increase your profit margin with the simple implementation of a dynamic pricing tool.
Rented CEO Andrew McConnell ends on a positive note. “The last year has been a rough one for our industry, but the silver lining is that more travelers are turning to private, professionally managed vacation rentals than ever before. It’s our great hope that Art empowers more vacation rental managers to optimize their pricing, deliver the best possible return to their homeowners, and see their business flourish in 2021 and beyond.”
