Any successful business has detailed strategies in place from operations, financials, sales & marketing and resource allocation. Your bnb hosting should be no different either if you want to be managing your rental properties efficiently. What are the main strategies to consider for a successful vacation rental business?
Know your customer.
Before you start planning anything you need to know the answer to this key question: who is your customer? Listing your apartment or spare room on bnb without knowing what type of guests you’d prefer to host can lead to loss of revenue, guest complaints and even damages to your property.
Do you have high-end furnishings in your apartment? Then you can increase your pricing and target more high-end customers. Is your property located a stone’s throw from popular nightlife spots? Focus on party goers and they will be leaving you glowing reviews as you are so close to the party scene instead of risking getting negative feedback from families who are seeking a peaceful and quiet location. Once you know who you are targeting then it is also important to keep in mind how to ensure the ultimate bnb experience for your guests at your property to generate positive reviews for your listing.
ACTION Create a profile of your ideal guests based on the quality of your apartment, your neighbourhood and the main attractions of your city. Once this is done, make sure that all content within your bnb listings showcase whom your property is ideal for (photos, property descriptions, house rules etc).
Set your baseline price.
Setting the appropriate nightly price of your apartment or spare room is a vital part in your strategy to become a successful bnb host. To maximise your rental income through bnb bookings, you need to make sure that your pricing strategy is optimised and follows the trends in your city.
Get the base line right first. Establish what is the average nightly price in your location in each season (taking into account major events and holidays as well). This will be your starting point. As an example if the average rate is $250 per night for a room in high season and your rental property has a luxurious finish with high-end amenities such as a jacuzzi and a top quality coffee maker, then you could easily set your base price at $300 – $350 per night. However if you are targeting budget conscious travellers and the interior in your apartment is rather basic then you’d need go below the average price to be fair.
ACTION Check the prices of properties that are similar to yours in the neighbourhood and establish the average nightly seasonal prices.
Optimise your pricing strategy
You need to also calculate your costs of preparing the property for a new arrival. Do you use a cleaning company for your vacation rental business or do you manage it yourself? You have the option to add a one-time cleaning fee to each reservation. It is recommended to use this functionality to cover your expenses and maximise your rental income.
Use your occupancy rate to optimise your prices. By being flexible with your pricing structure you can increase the number of last-minute bookings if you have some gaps between reservations or you can set slightly increased prices where you know demand will be much higher than on an average week (for example Christmas and new Year’s Eve reservations).
Price optimisation is an incredibly effective way to generate more revenue for you however it is also very time consuming.
ACTION Start by setting up Smart Pricing which will automatically amend the nightly prices of your property using a minimum-maximum price model, depending on the performance of your competitors and occupancy rates including yours.
Implement these 3 actions of your main strategies to master bnb hosting and maximise your income from your holiday rental property.
Ready to run your hosting business?
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