How to Use Pricelabs Dynamic Pricing Software for Your Airbnb

(00:00) Dynamic pricing software is probably one of the Airbnb or shter rental tools that I get asked about the most so in this video I want to share with you guys my setup using price Labs how I like to configure it and how I use it to optimize my pricing now before we jump into it I do want to share with you that one of the things I always share with people when they ask me about Dynamic pricing is that the tool is only as good as the person using it analogy I often give to people is it’s like putting an amateur
(00:37) driver behind the wheel of a Formula 1 car a lot of the time if you don’t understand pricing strategy then using one of these tools is not going to solve all your problems overnight a lot of these tools get build as pricing optimization tools what I found to be more effective at doing is pricing automation more so than optimization because fundamentally if you don’t don’t know how to actually leverage this tool and use it and set it up the right way and how to make tweaks when it’s not performing the way that you want it to
(01:07) then it’s not really going to perform that well you’re just going to be automating something that fundamentally doesn’t work that well that being said if you have gone through different training whether it’s from me or other people and you’ve done some manual pricing yourself and you understand the fundamentals behind pricing your property then using a tool like price Labs can be really really helpful because number one it’s going to going to take a lot of the work off of your plate it’s going to automate a lot of it
(01:33) and save you time and number two software is Dependable you don’t need to rely on yourself or another human to do it the software is going to do it and it’s never going to make a mistake so it definitely can do a better job if you know how to use it well so that being said let’s jump into it this is one of my properties here in price Labs now I’ve got other videos and I can do other videos as well diving into some of the other features Fe that price Labs have to off has to offer like their market
(02:03) research their portfolio analytics they even got a brand new uh Revenue estimator tool that I’m really excited to try out but for this video I just want to show you how I’ve got it set up for the core use case of dynamic pricing so what you’ll notice when you get in here is you’ve got basically your calendar that shows your dates and if you hover over any one of the dates and click on them you’ll see that exactly how it’s calculating the price you’ll see what the base price is what
(02:27) adjustments it’s making on that to increase or decrease to price all these different things and how it gets to that final price dates are all color coded to show you where there’s demand um and it’s pretty cool pretty easy to to see right now if you go over to Neighborhood data this is what I really like to look at specifically this first graph that’s going to show up here at the top because it tells you where your future prices align with the rest of the market so you can see that for the next couple months
(02:53) here my pricing is well below the remainder of the market and that’s because this property is in a market that can tends to have pretty lazy host in it for lack of a better word there’s a lot of people in this market that are really only interested in hosting people during the summertime because that’s high season and in low season they just don’t really care and as a result their properties often sit very very empty and very vacant so I know that about this Market which is how I know that I want
(03:21) to be priced below the market that’s one of those things that you really have to understand pricing you have to have some experience in order to do that because if I hadn’t made the adjustments to this so that during low season I’d price below the market I’d be priced way up in here and I wouldn’t be getting any bookings you can see however especially during the peak times of High season I’m I’m pricing myself up into the 75th and 90th percentile of pricing um even though my property isn’t a really high
(03:45) in luxury property I know that it can command those higher nightly rates um and so it’s again just knowledge of the market that tells you where to land and what I really really like about this future prices uh basically graph here is that I can very quickly see at a high level where I am Landing relative to the competition because I’ve got it specified for five bedroom um four to six-bedroom properties uh and so I can see exactly where I land relative to my competition the other cool thing is I can look at Future occupancies and I can
(04:15) also look at a at a competitor calendar so I can actually look at specific other properties so I can go go through here find actual properties that I want to compare my property to see how well they perform and I can make sure that I’m booked when they’re getting booked that that they’re not getting booked when I’m not those kind of things so what’s really cool here is I can specify the exact properties I want to track and then I can very quickly see here okay well you know my listing is booked for
(04:40) these dates their listings are not their listings are all sitting vacant there so that’s good now if I see that they get booked I can also see exactly what price they get booked for so again there’s not a lot here but you can see for example this listing got booked this weekend for $456 so that’s how I know that my 485 pricing is in a good spot I’m not out to lunch like these people that are at $1,144 for those nights um and you can see those people are really lazy with their pricing with just obviously having
(05:08) $1,144 as just their number all throughout the year right whereas these people they’re getting booked I’m I have my listing Priced Right Around where they’re getting booked at um and so that’s a good indication that I’m priced in the right spot so really really helpful tool there now let’s dive into the actual settings because there are a lot of them and the trick here is that less is more the more complicated you get with your settings in a dynamic pricing tool the more difficult it’s
(05:34) going to be to diagnose what is working and what’s not working and anytime you go and change things it’s just going to make things all wonky and it’s going to be really really hard to tell what changes to make in order to get things moving in the right direction so I like to keep things pretty simple here that being said with the dynamic pricing tool simple is already relatively complex so if we go in here you’ll see there’s all kinds of different things you can do so I’m just going to walk through them and
(05:59) I’ll show you exactly what I do and how I have it set for this property and how I recommend setting it for you depending on what kind of property that you might have so you’ve got your minimum stay settings that’s just going to dictate how long of a minimum night stay you want and you can have a lot of variety there so you can see here that you can have default and then have last minute so well you know I only want to take four nights stays or longer but if it’s last minute and I have a vacancy then
(06:23) sure I’ll drop it down to three or drop it down to two or I can go much more aggressive far out and then be have a kind of a default and a last minute I can also specify for Orphan gaps so what that means if I have two bookings and a gap in the middle then let’s say if I have a two-day Gap but I have a four night minimum stay well then now no one can book that that Gap there so I might want to go and decrease that to the length of the Gap uh with a minimum of two nights and then you can have a lowest minimum stay allowed just so that
(06:52) you know that no matter what no matter what happens the orphan Gap last minute whatever it might be you’re never going to go down below this that’s why I have that set to globally two uh two nights just cuz I never want one night stays in this property um it is a larger property that if I allow one night stays I can have issues with bad guest so I just don’t want to even bother with that and so you can see here that I’ve got far out set to four nights minimum so that I can get some of those bigger bookings
(07:18) but then as I get closer to I want to take three night bookings and then last minute I’m okay with the two night booking so it’s really cool there you can just have it taper and you can do that for different seasons as well so you can see that right now we’re in the minimum stay profile of High season but you can also set these up for different seasons out of the year so you might want to be more aggressive during High season and less aggressive during low season so pretty cool there um then you
(07:41) get into smart preset so there’s a lot of things you can toggle on you can see I’ve only actually toggled on a couple of them now the ones that I like to use are the custom last minute prices and I like to apply a gradual 35% discount for the 35 days leading up to the uh to the property being vacant I wouldn’t necessarily do this with all properties this being a larger property it does tend to get more bookings further in advance so I do want to be a bit more aggressive with my discounting for last
(08:09) minute prices however if I have a smaller listing that tends to get a lot more booked up last minute a lot of those bookings come in or last minute bookings then I’m not going to want to be nearly as aggressive as this I’m not going to want to Discount my pricing like this because I know that most of those bookings are going to come in and still book with me at full price even though it’s last minute and so what’s cool here is you can do fixed you can do gradual uh you can do flat dollar amounts flat percentages all kinds of
(08:35) cool stuff you can really customize the way that you discount leading up to last minute um customize orphan day prices so that we give a basically a 20% discount on weekdays um if there is an orphan gap of two nights so that just basically means if there’s a weird Gap that’s probably going to be like a Wednesday Thursday that not many people are going to want to book and they can only book it for those two days then we’ll just go ahead and give them a 20% discount on that are you a brand new or experienced
(09:02) Airbnb host co-host or investor who wants to host as successfully as profitably and with as much fun as possible if so then I would love to invite you to check out BNB tribe Linked In the description down below this video it’s our exclusive Community for Airbnb hosts investors and co-hosts from all over the world where I share some of my best trainings that go into detail on every single aspect of Airbnb hosting from A to Z we’ve got Advanced Training playbooks that will help you to use more advanced strategies to take things to
(09:35) the next level and make more money and have more fun hosting co-hosting or investing on Airbnb you’re also going to get access to an incredible community and over $2500 worth of deals perks discounts bonuses that I’ve negotiated with other vendors in the short-term rental industry so if you want access to all of that and a whole bunch more check out the link in the description down below for B&B tribe and I would love to see you on the inside far out prices occupancy based adjustments I don’t
(10:05) recommend using especially these occupancy based adjustments they really really really complicate things and ultimately you should already have a good enough understanding of pricing to not really need to use these um and be able to make tweaks where you need to and it kind of defeats the purpose of having price Labs if you start turning things like this on that make constant adjustments all over the place to your pricing custom seasonal profiles I absolutely recommend for just about anyone you can see once we come in here
(10:35) that you can have certain Seasons specified throughout the year and you can set specific uh base prices so you can see here um so you can see that you have different base prices you can set I don’t know why it’s not on for this property right now I think something got changed here but normally what I’ll do is I’ll have base prices for each different season throughout the year and that’s how you make sure that your that your property gets priced where you want it to be so basically is how uh how you
(11:00) guarantee that your price is uh is where you want to be on the range of other properties so if we get back out of here now uh my base price is different uh it’s set at a different amount for this period of the Year versus over in the High season time of the year and so that basically is the base price is what price Labs or any other pricing tool does all their adjustments off of so it’s your uh essentially you telling the software qualitatively how good your property is and where it should be in the overall range of other properties so
(11:32) it’s a really really good way to make sure that the pricing software is actually doing a good job if you put bad data in you’re going to get bad data out meaning that if you put a put the wrong base price in there that’s going to be one of the biggest things that impacts how well or poorly the software performs so you want to make sure that’s really accurate so the base price is a really really important one and I recommend doing different base prices in most cases for different seasonal periods
(11:59) throughout the year because in low season in a lot of markets you’re going to want to be priced lower relative to the competition and then in High season you’re going to want to be priced on the high end of competition so it’s really helpful to have those different custom seasonal profiles um demand Factor sensitivity that’s one that you can turn on and play around with if you’re interested uh it basically just determines how much your prices are going to be impacted by demand meaning if there’s high demand your prices are
(12:24) going to spike up more or less if there’s low demand are your prices going to drop down more or less you can get fun with that um and then you’ve got a whole bunch more customizations you can make so in here you can make day of the week pricing adjustments as well for certain days of the week um and then you can also come in here you can set up your seasonal profiles which this must be where I have my seasonal profile set up or maybe I’m just missing it everywhere yeah I think something’s gone
(12:49) weird here uh but this is another place to adjust your seasonal profiles and then you’ve got your minimum pricing uh for your far out days things like that you can put minimum weekend pricing and then even more advanced customization so this is where you can specify which days of the week are considered weekends um so that if you have a specific minimum night stay for guests to check-in on Thursday that you can just make sure that gets enforced that can be really helpful for anyone that tends to have a lot of traffic coming to their property
(13:15) on Friday and Saturday nights the last thing you want is to have a two night minimum stay and have someone book for Thursday and Friday night that means your Saturday night there’s a good chance it’s going to go vacant when it’s a high demand and high value night for you to get booked up so you can specify that anyone checking in on Thursday for example has to be making a three night minimum stay so you don’t end up having that um you can then also do different pricing offsets the JC factors rounding
(13:38) smoothing again these are all a whole bunch of things that you can do that you can see I’m not doing with my listing because they tend to just over complicate things again you want to use as few of these as possible and really let the tool do its job but it’s super important that for those little inputs that are actually important for you like the base price that you do a really good job of them I know that’s ironic because mine seem to be a little bit messed up but I know we’re all we’re all human
(14:01) here we all make mistakes there’s always things going on thankfully everything seems to be performing well still so I’ll just have to dig in after this and see what’s going on so that brings me to actually a really relevant point in this video which is once you have all your settings set up what does it look like to actually manage this because if you’re managing your prices manually then you’re probably going in there I would hope at least once a week checking all your prices updating a spreadsheet
(14:24) tracking what’s going on and making adjustments on a month-by-month basis as far as raising prices or lowering prices depending on how booked up you are but once you have a pricing tool like this set up what’s going to happen is that for the first year or so I still recommend coming in at least once every couple of weeks maybe once a month um and just checking how the listing’s Performing you’ll want to come in more often when you first set the tool up to make sure it’s behaving the way that you
(14:50) expect it to and then later on you can let it become more and more and more hands off to where you’re just going to be really checking in on it and making sure it’s doing a good job and then really the only time that you should have to come into it after that is going to be to make any adjustments on an annual basis if the market changes things shift you know there’s big differences going on there or if you need to make adjustments to your pricing strategy things change like this uh you know maybe the the software updates
(15:17) you’re going to come in you’re going to tweak things but for the most part it should be very very hands-off once you get it set up and it’s actually running the way that you want to so I hope this been a really helpful and valuable kind of walkthrough of price Labs we’re going to have an even more detailed walkthrough of price Labs how to use it all the different tweaks and tools and if you want to get access to that and you want to also get my help with helping you to set up the pricing tool
(15:39) for your unique property um and you want to learn from some of the best in the business when it comes to pricing and get some really great discounts and perks for joining up with price lab different pricing software then check out B&B tribe it’s linked in the description down below it’s a really really awesome community that we built of short- term mental investors hosts co-hosts from all over the world and it’s a really really great place to be we’ve got additional training that’s going to help you actually implement
(16:03) this for your own listing we’ve got perks deals all kinds of fun stuff so check it out again it’s linked in the description down below I would love to see you join there uh with all that said I hope you enjoyed this video if you did give it a thumbs up uh it really does help me out with growing this video and getting these videos in front of more people uh with all that said thank you so much for watching this video and I’ll see you in the next one [Music] right [Music]