Setting prices and managing accommodation costs. Is it possible to increase profits without losing guests?

Why is this so important? Because the price of accommodation is one of the key factors influencing guests’ booking decisions. Rates that are too high can scare customers away, while rates that are too low can cause the profitability of your property to drop, leaving you working at the break-even point. However, by managing your prices properly, you can strike the perfect balance – attract guests and increase your profits at the same time. Why else? Because a clear, factual price list means transparency from the guest’s point of view. Well-thought-out, tailored prices and clear information about them build guests’ trust in your property.

In this article, we will show you how to effectively set a price list in the accommodation industry so that it is attractive to tourists and at the same time allows you to maximize your revenue. You will learn how pricing strategies in rentals can help you adjust rates to the season, days of the week, or local events. We will also discuss various discount techniques and ways to attract guests that will not negatively impact your budget.

What’s more, we’ll reveal when it’s best to introduce new, higher prices so that they are naturally accepted by customers. It turns out that the beginning of the year is the perfect time for price increases, as people are already accustomed to price increases during this period in many industries. By communicating the changes appropriately, you can avoid negative reactions and continue to enjoy high booking levels.

If you want to learn how to fully exploit the potential of your accommodation facility without scaring customers away, this article is for you. Get ready for a solid dose of knowledge and practical tips that will allow you to increase the profitability of your facility and stand out from the competition.

Dynamic pricing – the key to optimizing profits in short-term rentals

Did you know that a static price list in tourism can limit your profits? A price set once and for all does not take into account changing demand, seasonality, or events in the area. That is why introducing dynamic pricing is the basis for effective accommodation price management. You may have already heard about dynamic pricing in short-term rentals, or perhaps you have missed this information. Either way, it is an extremely important practice in this type of business.

The biggest factors influencing interest in your property are:

• SEASONALITY
• DAYS OF THE WEEK
• HOLIDAYS
• LOCAL EVENTS

In summer, seaside guesthouses are besieged, while in winter, ski resorts are. This is typical tourist behavior and a perfect example of where the aforementioned price dynamics can be applied. It is then, during the peak months for a given resort, that prices may be higher. In the low season, on the other hand, it is worth offering promotions and discounts to attract guests who might otherwise choose a cheaper alternative.

Don’t forget about the days of the week – Fridays and weekends are more popular than midweek, so rates can be higher. And if there is a big event in your area (e.g., a festival, conference, or sporting event), it is worth adjusting your prices for that time, as demand increases significantly.

Our advice is always aimed at optimizing your business, which is why we suggest that dynamic pricing management is facilitated by modern tools such as MultiCennik in BedBooking. With it, you can automatically adjust prices depending on the season, occupancy, or other factors, allowing you to maximize profits without having to manually change rates.

Discount strategies and promotions in rentals – how to attract guests without reducing the value of your services?

Do discounts always mean lower profits? Not necessarily! The key to an effective pricing strategy is to offer value rather than simply lowering rates without thinking. How can this be done?

Instead of attracting guests with low prices alone, which can sometimes be seen by guests as a desperate “marketing ploy,” you can offer something extra—free breakfast, free parking, a longer stay for the same price, or a later check-out. Such extras make the customer feel appreciated and more willing to book accommodation without feeling the need to look for a cheaper alternative. Clever, right?

Last-minute discounts and first-minute offers in short-term rentals

We have been familiar with this type of offer for years, both as entrepreneurs and as users of them to a greater or lesser extent. How can you apply them to your short-term rental property?

• Last minute is a great option if you have rooms available on a given date – it’s better to rent them out cheaper than leave them empty, right? However, don’t forget not to overdo the discount and remain profitable.
• First minute works well for customers who plan ahead – by giving them a discount, you can fill your property much earlier and be sure of a stable income. In this case, analyze your cancellation policy so that you can accommodate your guests to a certain extent, but also not lose money.

It is also worth implementing loyalty programs and discounts for regular customers. Especially if you have more properties for short-term rental. People who have already visited your property and were satisfied will be happy to return if you offer them a discount on their next stay or other benefits. Loyal guests are the best investment because they not only come back, but also recommend your property to others.

When and how to introduce higher prices?

Many property owners are afraid to raise prices, fearing that they will lose customers. But the truth is, if you offer high quality, guests will accept the increases. We have already discussed dynamic pricing above, but with inflation and ubiquitous price increases, for example for utilities, heating, etc., it is also necessary to increase the base rental price.

The beginning of the year is the best time to change prices, as people are accustomed to rate increases at this time in many industries. It is then worth updating the price list and communicating the increase in an appropriate manner. Instead of writing: “We are raising prices,” it is better to use phrases such as:

– “In order to continue to provide the highest standard of service, we have adjusted our prices to reflect the current costs of maintaining the facility.”

– “New amenities and better service quality – check out what we have prepared for you this year!”

Is it better to introduce prices gradually or change them all at once? Both approaches have their advantages:

• Gradual increases allow customers to get used to higher rates and avoid sudden shock.
• A one-time change works if you have strong arguments (e.g., renovation, new amenities).

To avoid chaos in price management, it is worth using the MultiPrice list in BedBooking. This tool will help you smoothly introduce new rates and automatically adjust prices to different conditions.

Monitoring the competition and optimizing rates

Should you set prices based solely on the costs of running your facility? No! Market and competition analysis is equally important. Don’t fall behind!

Regularly check the prices offered by similar facilities in your area. If you are cheaper, it is worth checking whether you are undervaluing your services. If you are more expensive, consider how to justify the higher price (e.g., better standard, additional amenities). This aspect of running a short-term rental property is a marketing and financial aspect that cannot be overlooked.

Is it worth competing on price? Not necessarily, competing on quality will work much better. Instead of chasing the lowest rates, focus on better guest service, unique decor, and attractive stay packages. This will make customers choose your property, even if the price is higher. Also, make sure your offer is visible and keep your prices at a reasonable level.

Remember to take a flexible approach to pricing. Testing different rates and observing the results allows you to find the optimal price level – one that attracts guests and ensures maximum profits. Statistics will help you facilitate this process, and you can freely use them in applications such as the BedBooking online booking system.

Accommodation price management is a key element of success in the tourism industry. The right pricing strategy allows you to increase revenue without the risk of losing customers. Read again, in summary, what you need to remember to increase profits without losing guests:

✔ Adjust prices to seasonality, events, and occupancy.
✔ Instead of lowering prices, offer added value.
✔ Introduce price increases at the right time and communicate them in a thoughtful way.
✔ Monitor the competition and test different price levels.
✔ Use dynamic pricing management tools, such as MultiCennik in BedBooking.

Want to learn more and effectively manage your pricing? Check out additional tips and features in the BedBooking app:
🔗 MultiCennik – price management
🔗 New features in price management