What percentage should we increase our prices at peak times?

1

I need to open my calendars up for the Christmas to New Year week and then the summer holidays. However I am stalling as I can’t make a decision on what to do. My normal prices before last minute discounts are $360 for Friday and Saturday nights and $290 for weekdays. last summer season I made it $450 for every day from Christmas Eve to the end of January. This is an increase of 25% for week nights and 55% on week days.

What does everyone else do?

2

I’d just raise my price to $500 a night since you’ve already said you will be 87% booked (in a slow month) at that rate.

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3

That $500 is what the guest pays as it’s my base rate plus the $80 cleaning fee and the air charges. I wonder if I break through the $500 barrier whether I’ll get dinged too much on value.

4

… break thru the 500 barrier while continuing with the 10 Prosecco …? I sure would ding on value …
However your market seems to support crazy prices. Why don’t you try it out. If you get no takers, you can always lower the price again.

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5

Me too! But I would never waste that type of money in the first place.

6

What does your market research show you that your competitors are charging for comparable properties @Poppy?

7

There aren’t any like mine, and we are way more expensive to the closest ones. My gut says I shouldn’t go over the $450 base which is the price I did last year. It’s not a matter of getting bookings and people willing to pay it, it’s how much I will suffer in the star value rating. I said that if we ever drop to 4* for value I would drop the price but miraculously somehow we stay on 4.6.

8

For big events, New Year etc. I open the dates on other platforms first which don’t have a specific value section of the review. If a guest does happen to mention low value in their review it’s not a huge problem as only about 20% of my bookings come from the other platforms.

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9

Our Christmas week is 70% more than the week before, 30% more than the week after, and 250% of the lowest of the low season.

My business philosophy is - charge what the market will pay. I don’t run the business in a way targeted to get reviews - I run the business to have happy customers. And I’m not sure many guests look at the “value” rating anyway - they don’t know what that guest paid, compared to what they are going to pay. So, although we’ve had a couple of 4-stars in value, I don’t worry about that rating (or location, but that’s another thread).

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10

Great reply, thank you.

11

I find it easy to set my peak season rate, it’s the off-peak rate I struggle with. I used to take 20% off but last year did 40%.

12

I think we all struggle in the off peak, during this time I just constantly change the prices, until I get a booking. But I do have a low base I won’t go past as by the time I take my 20% I don’t believe what the owner is left with is worth the wear and tear on their place. Plus we all know lower paying guests are the worst guests.

At the beginning of this winter one of my owners got into a bit of a panic about the lack of forward bookings and told me to lower it more that I agreed with. At the end of the day it’s her place so I did as I was told. We only got 1 guest at the ridiculous low price and he dinged us on value!!! I was so angry. Then bookings just picked back up and has been fine since.