Vacation Rental Rates, Pricing
How To Increase Vacation Rental Profits By 11% Without Pricing Your Rates Too High.
I regularly write about value pricing with experiences. Know your ideal vacation rental guests, what is important, meaningful and relevant to them, then set your vacation rental prices accordingly. This is not a one-shoe fits all approach, but customized to your target market.
Dr. Rafi Mohammed, author of the 1% windfall: How Successful Companies Use Price to Profit and Grow, gives a few things to think about — and if they resonate with you – go on line and buy the book. In a nutshell, a study of 1200 companies “Found that if companies increased prices by just 1% and demand remained constant, on average operating profits would increase by 11%”. This book is not written for the vacation rental industry, but I like the cross fertilization of ideas and thinking.
1. Stop marketing up costs and set a price that reflects value.
2. Create a value statement and go a step further and make sure it is aligned with the customer experience statement.
3. Be cautious with discounting – but understand different customers have different pricing needs — again it comes back to knowing your ideal guest.
The message here is not to be formula driven, but customer driven.