As today's world of e-commerce continues to evolve and grow, it has become clear that variable, dynamic pricing is a key factor to success. Consumers are quickly getting accustomed to negotiating prices or finding the best-price using various search engines that have sky-rocketed in popularity for purchasing hotel rooms, airline tickets, etc. Gone are the days of buyers passively accepting what is posted as "the price". Our new reality is a more savvy, price-conscious consumer looking for the best deal possible. Don't we all want a good deal these days?
How does this translate to the world of vacation rental properties? With the economy down, the trend in dynamic pricing and flexibility with terms has increased. There is been a noticeable increase in the number of guests who can only afford a 3 or 4 day summer vacation, instead of the 5-7+ day period we expected in past years. Some guests are nervous about their employment status and concerned about the financial commitment to a vacation if their job future is unclear. Moreover, vacationers (like everyone) are trying to do more with less. We have seen a marked increase in people booking at the last minute, agreeing to take what is left over in hopes they will receive a major price reduction. This has always been a component in our industry during the winter, as ski season conditions can fluctuate from day to day, week to week. But this trend is spilling into the summer and holiday periods as well.
Our close industry cousin, the Hotel/Motel industry, has been quick to accept this new reality and have embraced the use of various search engines to tabulate truly dynamic pricing. The vacation rental industry has been slower to respond to this popular trend. However, it is becoming increasing obvious that the time has come to give this topic more attention and continue to make pricing changes to the homes in our rental pool, as needed. The goal is simple: maximize the number of nights booked. Gene Bennington uses the analogy of shoes. If a retail store has a pair of shoes for sale and they don't sell on Monday, the store still has the product to try and sell on Tuesday or Wednesday, etc. However, if a vacation rental or hotel room doesn't sell on Monday, then it is over and there is no way to recapture that night's revenue ever again.
In an effort to address this clearly emerging trend, we have spent more and more time contacting our homeowners and floating proposed reservations that do not meet the nightly rate minimum, with the understanding that "something is usually better than nothing". Most owners really appreciate this effort and graciously accept the proposed rate reduction. Time is of the essence when trying to land a booking. Our goal is to convert every inquiry call into a booking and when we stop and contact owners for permission it can sometimes translate into a delay that results in losing a prospective rental. The more autonomy owners allow us to exercise in the reservations department, the quicker and more responsive our service.
Everyone is getting acclimated to the new economy and here at Bennington Properties we want to be on the cutting edge and earn every dollar possible for you. Some owners agree with this in philosophy yet have had some challenges in keeping track of the actual revenue since there is now more variation in the pricing. To see the actual revenue associated with each booking, owners can go in their Bennington Owner's web page and click "Rentals". In that page, click "View Rentals" to see the actual prices, including gross rent, commission and charges associated with that rental, and net to owner.
Please take some time and let us know your thoughts on this. We can make notes in your Owner file granting authorization to do what we see is best and that can help save time and gain in nights booked for your home. Contact Deb Nikita (deb@benningtonproperties.com) or Robert Bennington (robert@benningtonproperties.com) for more on this.
How does this translate to the world of vacation rental properties? With the economy down, the trend in dynamic pricing and flexibility with terms has increased. There is been a noticeable increase in the number of guests who can only afford a 3 or 4 day summer vacation, instead of the 5-7+ day period we expected in past years. Some guests are nervous about their employment status and concerned about the financial commitment to a vacation if their job future is unclear. Moreover, vacationers (like everyone) are trying to do more with less. We have seen a marked increase in people booking at the last minute, agreeing to take what is left over in hopes they will receive a major price reduction. This has always been a component in our industry during the winter, as ski season conditions can fluctuate from day to day, week to week. But this trend is spilling into the summer and holiday periods as well.
Our close industry cousin, the Hotel/Motel industry, has been quick to accept this new reality and have embraced the use of various search engines to tabulate truly dynamic pricing. The vacation rental industry has been slower to respond to this popular trend. However, it is becoming increasing obvious that the time has come to give this topic more attention and continue to make pricing changes to the homes in our rental pool, as needed. The goal is simple: maximize the number of nights booked. Gene Bennington uses the analogy of shoes. If a retail store has a pair of shoes for sale and they don't sell on Monday, the store still has the product to try and sell on Tuesday or Wednesday, etc. However, if a vacation rental or hotel room doesn't sell on Monday, then it is over and there is no way to recapture that night's revenue ever again.
In an effort to address this clearly emerging trend, we have spent more and more time contacting our homeowners and floating proposed reservations that do not meet the nightly rate minimum, with the understanding that "something is usually better than nothing". Most owners really appreciate this effort and graciously accept the proposed rate reduction. Time is of the essence when trying to land a booking. Our goal is to convert every inquiry call into a booking and when we stop and contact owners for permission it can sometimes translate into a delay that results in losing a prospective rental. The more autonomy owners allow us to exercise in the reservations department, the quicker and more responsive our service.
Everyone is getting acclimated to the new economy and here at Bennington Properties we want to be on the cutting edge and earn every dollar possible for you. Some owners agree with this in philosophy yet have had some challenges in keeping track of the actual revenue since there is now more variation in the pricing. To see the actual revenue associated with each booking, owners can go in their Bennington Owner's web page and click "Rentals". In that page, click "View Rentals" to see the actual prices, including gross rent, commission and charges associated with that rental, and net to owner.
Please take some time and let us know your thoughts on this. We can make notes in your Owner file granting authorization to do what we see is best and that can help save time and gain in nights booked for your home. Contact Deb Nikita (deb@benningtonproperties.com) or Robert Bennington (robert@benningtonproperties.com) for more on this.
