If we were only going to offer one tip, the absolute no-brainer would be that if you aren’t using Everbooked to price your Airbnb listing, you need to sign up right now, add your listings, and start automatic pricing. With no additional changes, you would be avoiding the common pricing mistakes and have your listing updated automatically as conditions change using our dynamic pricing algorithm. You can even improve your ranking in Airbnb search results just by using Everbooked!
For this I’m going to assume you are already using Everbooked, and I’ll show you some some additional pricing-related tweaks to get the most out of your listing.
1. Adjusting your Airbnb base price
In your Airbnb account there is a field marked “Base Price”. This is the nightly price that your listing would sell at if you weren’t using Everbooked. It’s also the price that is used in Airbnb search results, so you want to set it well within the price range that you hope to appear in search results for.
2. Setting your Everbooked price range
Everbooked pulls in the base price from your Airbnb listing on first import to use as your “default” price, or the price that we build your long-term pricing strategy around. The default price in your Everbooked account can (and should) be changed. It won’t change the base price in your Airbnb account.
The real key to good pricing optimization is allowing for a wide range of change, so it’s important to set your default price and minimum price accordingly. The general tendency is to set the default too low and the minimum way too high, so keep this in mind when adjusting your pricing. Once your default and minimum are set up properly, you won’t often sell at the minimum unless there is very little demand and the booking date is very near. Of course the number of good reviews you have is also an important factor which we will be taking a look at as well.
3. Setting the default price
The Everbooked “default” price is the number around which all pricing adjustments are made. If there were no positive or negative factors affecting your pricing on a given day of the year, your Airbnb would be listed at exactly that price.
Since Everbooked is looking at demand across the entire year, it is important to make sure your default price reflects what the real average market price for the year should be. If this is low season and your home rents for $100/night and in the summer you can regularly book for $300/night, your Everbooked default price is probably best at around $200 – even if that doesn’t make sense at all under the current demand conditions. Once you have found this number, we will be making the adjustments for you including taking all of your region’s seasonal fluctuations into account, so be sure to take the current influences that you know about out of the equation when selecting a default price.
If you don’t already have historical data to base this on, your best bet is to pick a variety of similar listings with a similar number of reviews, and see what prices some are getting booked at and which prices others aren’t. In fact, this would be a good idea to check against even with historical data, as knowing what your competition is doing successfully is always helpful. Of course that will only give you a current seasonal approximation of what is working, but it’s a starting point to build on.
4. Setting the minimum price
The tendency when setting a minimum price is often to choose a number that still includes a lot of profit, but that’s generally not going to work very well – particularly for hosts and listings that don’t have many reviews yet. Making more money on your listing is a long term goal, so setting the minimum price low enough is very important.
At the most basic level, minimum price should be the least you can possibly charge to rent a single night and still have it be worth booking. That said, if you don’t charge separately for what you pay to a time-saving management service like Pillow, you will have to factor that in, but many hosts charge for much of this in a cleaning fee and make their nightly rate as close to pure profit as possible.
If you think of your minimum price as pure profit you could theoretically set the price very low and make quite a bit more money over the course of the year because of last minute bookings you may not have captured with a higher minimum. Of course you will want to look at factors such as maintenance costs or advertised luxury amenities, but in general those should be factored in to the overall pricing structure after comparing your listing to comparable ones with similar numbers of good reviews, not just when looking at the minimum price.
5. Adjusting for good reviews
Where you can set your price range (default and minimum) is often dependent upon existing good reviews. A common mistake is to start out with pricing that doesn’t reflect lack of reviews. There is a big difference between the financial potential for a listing with no reviews and one with five stars, not to mention one with 20+ five star reviews.
Though it’s tempting to start out with rates that match existing listings, you can take advantage of this by keeping your default and minimum very low for the first few bookings, making sure to have the best service and communication possible. That includes making sure your listing description is accurate and your photos, especially the ones that display on the Airbnb landing page for your listing, show off your place in the best possible light! Here are some tips from two Superhosts on how to make sure you are giving service that will result in good reviews.
Once you have a few reviews, you shouldn’t change your level of service, but you can begin to adjust your default and minimum pricing. Though it’s tempting to start out pricing your listing at the rates of established listings, a lot can be gained by quickly building your foundation of reviews. One recommendation by Probnb is to start with rates 15% lower than your comparable competition, but of course you can always go lower.
As an Everbooked user, you are already well on your way to avoiding common pricing mistakes for your Airbnb listing! With these tips and a little local research, you’ll be ready to adjust your Airbnb base price, set your Everbooked price range (default and minimum prices) and deal with relatively few reviews. You’ll also be well on your way to getting more bookings at better prices.
Watch this space for more tips on making the most of your Airbnb listing!