Last-Minute Pricing Strategy Playbook
Summary
This article from PriceLabs provides a playbook on last-minute pricing strategies to avoid panic-discounting and maximize revenue. It emphasizes using OTA promotions, optimizing listing content for visibility, and strategically adjusting minimum length of stay (LOS). The article also highlights the importance of data-driven automation, especially with PriceLabs, to capture revenue, target higher-value guests, and understand market trends.
Key Insights
- •The most effective revenue managers automate using a Cascading Minimum Stay Strategy.
- •Consider experimenting with a 5-20% reduction in your minimum nightly pricing during the low season. However, your minimum price should ideally be 20-30% less than your base price to maintain profitability.
- •Using built-in “Last Minute” promotion tools on platforms like Airbnb and Vrbo, can boost search ranking and provides a psychological appeal to guests.
- •More guests are choosing longer stays to combine work and leisure.
Action Items
- ✓Use the merchandising tools provided by OTAs (Online Travel Agencies) for promotions rather than manual price cuts.Effort: lowImpact: medium
- ✓Use PriceLabs Listing Optimizer to evaluate your listing score and understand which areas need improvement to improve your visibility.Effort: lowImpact: medium
- ✓Consider strategically adjusting your minimum length-of-stay (LOS) restrictions when you have last-minute availability.Effort: lowImpact: medium
Tools & Resources
- →PriceLabs Listing Optimizer: Use PriceLabs Listing Optimizer to evaluate your listing score.
- →PriceLabs Market Dashboard: Use PriceLabs Market Dashboard To Understand Market Trends
- →PriceLabs Dynamic Pricing: Use PriceLabs Dynamic Pricing.
Common Mistakes
- ⚠Panic-discounting can devalue your vacation rental brand, attract lower-quality guests, and ignite a “race to the bottom” that hurts your entire local market.
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