9 Sep 2022
Dynamic Pricing: The Secret to Our Record-Breaking Success
Now that you’re ready to get your rental property out on the market, or you’re considering switching companies, there are a lot of words and quite a bit of jargon being thrown around and it’s easy to get overwhelmed. You’ve got phrases like “market analysis,” “revenue management,” and “dynamic pricing” floating around, adding more to your already full plate.
But what if we could break down at least one of these and show you how Seaside Vacations can help you get the most bookings while sacrificing the least amount of time? Keep reading for more information about the way that Seaside Vacations uses Dynamic Pricing to help you have record-breaking books without the extra effort.
Why Does Pricing Matter?
Setting the rates for your vacation rental can be one of the most important, and equally overwhelming, aspects of running your vacation rental property business. It’s essential to make sure that prices are attractive to potential renters while still ensuring that you not only make enough income to offset costs but also remain profitable in the long run.
It’s important to ensure that your rates aren’t too low, so as to leave you owing money at the end of the season, while rates that are too high will leave you with unbooked weeks and fewer rentals. Determining the rates for your rental property is an ongoing balancing act requiring research and regular changes based on market conditions, competitor pricing, and the age-old adage of supply and demand. Fortunately, there are several different ways to determine rates, some of which are tested to work better than others.
What are the Different Ways to Determine Rates?
Dynamic Pricing isn’t the only way to determine rates for your rental property. In fact, for homeowners who aren’t using a property management company, a lot of planning, research, and work goes into determining prices each year. There have been trends for several specific ways that people determine pricing for their property.
Some homeowners decide what they’re going to charge for their vacation rental property and leave it at that set rate year-round. This may seem easier in the long term, but it doesn’t account for vacation seasonality and can result in lost income or even fewer bookings, depending on the rate.
Peak-Season vs. Off-Season Rates
One of the more traditional methods of setting rates, using pre-determined “peak-season” and “off-season” rates takes into consideration seasonality but fails to adjust for real-time trends that can affect bookings. This is usually a more successful option than static pricing but still can leave you losing bookings based on competitor rates.
Comparing Rates and Adjusting
This method primarily focuses on looking at competitor prices (either occasionally or on a set schedule) and adjusting your rates accordingly. Again, while this makes sense on the outside, the reality is that this option requires quite a bit of extra work on your part and isn’t as reliable as some other methods, since it will depend on who you’re looking at, what rates their setting, and how often you’re able to research.
What is Dynamic Pricing?
Dynamic pricing is essentially a mathematical way to calculate rates based on algorithms intended to get you the most bookings with the highest income while adjusting prices based on market changes. This method takes into account not only seasonality, but also days of the week, local events, how your competitor bookings are looking, their prices, and published reviews of your property. In other words, setting prices that get you the highest possible income takes a lot of different things into consideration.
By being able to adjust your rates throughout the year based on historical data and ongoing fluctuations in bookings, competitor rates, and socioeconomic factors, you’ll be able to get the most out of your vacation rental business without having to spend all your free time investigating competitor rates and monitoring vacation trends.
Why Choose Dynamic Pricing?
So now that you’ve seen everything that Dynamic Pricing takes into consideration when establishing rates, I’m sure you’re wondering exactly why you - or the rental management company you hire to market your property - would spend all this time and energy to ensure your rates are based on dynamic pricing?
Because it works.
And it earns you increased revenue on your property investment.
But there are also a couple of concrete reasons why Dynamic Pricing just makes sense.
It Maximizes Profit
It Keeps You Competitive
It Saves Time in the Longrun
How does Seaside Vacations use Dynamic Pricing to get you the most income?
And one of the best parts?
You still get the final say.
If you don’t like what we come up with, you, as the homeowner, can still choose to go in a different direction with your rates. We’ll work with you to make sure that you get the most return on your investment while still bringing in bookings and ensuring filled weeks and happy guests.
But why not let us take the guesswork out of setting yearly rates?
With decades of experience and a dedicated revenue team, Seaside Vacations will work with you to set yearly rates that are competitive while ensuring that you’re getting the most out of your property investment. We love property management on the Outer Banks and it shows. Family-owned and locally managed for over 30 years, Seaside Vacations goes above and beyond to make sure property management is Hassle-Free, meaning that we’ll take care of the details so that you can get back to taking care of the things that matter most to you.
When you’re ready to give us a try, fill out this form for your Complimentary Rental Projection or give us a call at (252) 616-1056 to find out more about property management with Seaside Vacations today!
We’re experienced and here to help.
About the Author: Lauren is the author of two books and a travel enthusiast. She grew up on the Outer Banks and only left for a few years to get her degree at UNC-Chapel Hill and complete a tour in the Coast Guard before making her way back to the beach in 2017. The only thing Lauren loves more than writing is sharing her love of the Outer Banks and its rich history with visitors and locals alike. When she isn’t writing for the Seaside Vacations Travel Blog, Lauren can usually be found with a book and cup of tea in hand, planning her next travel adventure and trying to figure out what happened to the Lost Colony.