27 replies [Last post]
Hillbilly's picture
Offline
Joined:
10/22/2011

I have been bouncing ideas around in my head about our prices. We are in a busy location most of the year. We almost always book all weekends and the May - Jan are very busy. We turn a lot of people away on weekends. I know a lot of properties in our town are not busy. If we are turning a lot of people away should we raise our rates to cut down on that demand? Or maybe we are priced bellow what we should and we are getting more biz because of that?

__________________

Hillbilly

 

egoodell's picture
Offline
Joined:
06/01/2008

When you get that busy I'm told it's time to raise your rates. Then you will make the same money for less work.

Riki

__________________

Riki Goodell
Arcady Vineyard Bed & Breakfast
Arcady Vineyard Wine Tours
www.arcadyvineyard.com
Come! Let us show you the beautiful Monticello Appellation!

 

Offline
Joined:
11/27/2010

I have been playing around with flexible prices for a few years now.

If you price higher in the last few weeks and manage to rent out all rooms, it may mean that you priced too low at the beginning. You may have sold several rooms too low & lost some extra income opportunity.

On my side, I first have a very detailed analysis of the occupation ratio and prices of the previous years (important to keep stats). Based on this, I have sliced up in different price sections for each of our 3 rooms, for 6 "seasons", week day/week-end, direct/indirect booking. For each section, based on history, I have set the ideal price that should allow to get the optimum profit. Then, every 2 weeks, I analyze how the coming month are filling up and decide to adjust these prices up or down if or as required. I often end up putting down prices for last minute booking of the remaining rooms (knowing that first ones went higher). Prices for a couple with breakfast range from 66 to 164€. The highest is the easiest to sell !

This method allows me to ensure I do not sell too low and helped me increase turnover.

I admit I do not fully understand why airlines/big hotels proceed differently. I suspect that the N° of seats/rooms may bring a different thinking. Starting with a lower price mean they can ensure their break-even line will be reached. Higher final prices are seen as a bonus.

What is your take ?

I do not show prices ranges on the website. Visitors need to enter the date to view the prices. This way, they do not know wether they paid a high price or not.

 

__________________

Thomas, Hotel in Cluny, France

 

gillumhouse's picture
Offline
Joined:
05/22/2008

I do not show prices ranges on the website. Visitors need to enter the date to view the prices. This way, they do not know wether they paid a high price or not.

Here in the States that would not work. People want to know price before they even consider looking at dates. If price is not in front of them, they move on. Some of course, fail to read and call about price even when it is there on the end of their nose, but then they are calling to ask price before they consider booking.

Arks's picture
Offline
Joined:
05/22/2010

gillumhouse wrote:

I do not show prices ranges on the website. Visitors need to enter the date to view the prices. This way, they do not know wether they paid a high price or not.

Here in the States that would not work. People want to know price before they even consider looking at dates. If price is not in front of them, they move on. 

Yes, that describes me. When I visit any website, if I don't see the price of something right there, openly in black and ink (an old Lum and Abner expression), I move on. If a website says, "contact us for pricing," I think, the price must be so high they want to work on me, win me over, before they reveal it, and I don't like that.

__________________

All saints can do miracles, but few of them can keep hotel. ~ Mark Twain

 

Joey Camb's picture
Offline
Joined:
04/02/2010

see we don't have that problem - most people use OTA's so are used to putting in their dates and getting a list of properties and prices so its not an issue, they also understand prices can change by the day and even by the hour.

__________________

Don't mess with me today or I will kill you!!!!

 

Arks's picture
Offline
Joined:
05/22/2010

camberleyhotelharrogate@yahoo.co.uk wrote:

...they also understand prices can change by the day and even by the hour.

Yes, that's the norm here for hotels. When I want to see what a room costs at the local hotel, I have to tell it the date first. 

But as long as listing the rates on the B&B room page is the norm here, people will expect it, and won't book unless they know up front. It will take years to change things.

Offline
Joined:
11/27/2010

Everything change so fast nowadays...

Here, no one ever said anything about not showing prices on our website.

Madeleine's picture
Offline
Joined:
09/29/2011

souslechene wrote:

Everything change so fast nowadays...

Here, no one ever said anything about not showing prices on our website.

It will put you ahead of the game to show the prices!

__________________

Everyday, for good or ill, we intersect with some else's story and become a part of it.

 

Joey Camb's picture
Offline
Joined:
04/02/2010

see this is one of the weird areas where most BB's in the Uk - urban ones not country as they are a bit behind are expected to be on the same ota sites and compete and price in exactly the same way - its what the customer is trained to do

Its making a huge problem with the tour de france next year for my town - no one is putting rooms online as they don't want to pay commission - however the general public have no idea how to find rooms now that this avenue has been cut off!

Hillbilly's picture
Offline
Joined:
10/22/2011

camberleyhotelharrogate@yahoo.co.uk wrote:

see this is one of the weird areas where most BB's in the Uk - urban ones not country as they are a bit behind are expected to be on the same ota sites and compete and price in exactly the same way - its what the customer is trained to do

Its making a huge problem with the tour de france next year for my town - no one is putting rooms online as they don't want to pay commission - however the general public have no idea how to find rooms now that this avenue has been cut off!

You should hold an Auction for your rooms.  Smiling

Joey Camb's picture
Offline
Joined:
04/02/2010

smiley Im in a good location right in the town centre about 5 minutes walk from the route so we are already full - its the places off the main drag that have rooms left but to be fair there aren't even many of them left now either - 1 bedroom serviced apartments up the street from us are going for $1600 for 3 nights.

Madeleine's picture
Offline
Joined:
09/29/2011

camberleyhotelharrogate@yahoo.co.uk wrote:

see this is one of the weird areas where most BB's in the Uk - urban ones not country as they are a bit behind are expected to be on the same ota sites and compete and price in exactly the same way - its what the customer is trained to do

Its making a huge problem with the tour de france next year for my town - no one is putting rooms online as they don't want to pay commission - however the general public have no idea how to find rooms now that this avenue has been cut off!

They should just calculate the % and add enough to cover it. I would guess that rates are thru the roof anyway. And, it's a pretty dim bulb that can't figure out how to find a room without some sort of hotel listing!

Offline
Joined:
10/07/2008

Supply and demand.

It is a difficult question. Ask us again when I am there in December. Maybe I will have a first hand perspective. I have learned that we inns are so dang different, sometimes what one of us does makes no sense to another. I have officially NOT raised prices on peak weekends now. Which are only a few, but we are getting repeats and I feel like I should give them a return discount, and the water is all too muddled, so I just stopped, altogether.

__________________

Gluten free is never free. - Joey Bloggs

 

Hillbilly's picture
Offline
Joined:
10/22/2011

That sounds good JB. We are looking forward to all of you coming.
I just have a few rooms left for weekends between now and the end of the year. I raised them just to see what will happen. To early to tell yet. I made a suggestion on the reskey forum to John about an idea. I think it would be great if the system would give a discount that we could set for return guests. For the reason you just mentioned. I think if a guests makes another reservation within a year it woul be nice to have them on VIP status so to speak. Maybe te system could send out a reminder 30 days before that time limit ends. After a year, no discount. Might gain more repeat customers.

Hillbilly's picture
Offline
Joined:
10/22/2011

Lots of great advice. I might even advertise to book early as prices will go up as we get closer to arrival date. I do remember years ago looking at a Hotel in Florida. I checked for a date in Aug a few months before and the rate was $159 a night. I thought maybe I would wait until closer to time and the rate went up to $220 a night. Thats what I had to pay. I forgot about that. Im sure it was because of demand as well.

Madeleine's picture
Offline
Joined:
09/29/2011

How about this...keep the rates you think are 'right'. When you start filling up, ie- get halfway full, raise the remaining room rates and see what happens. I rarely have problems filling the remaining rooms at the higher prices.

 

Breakfast Diva's picture
Offline
Joined:
05/26/2009

Madeleine wrote:

How about this...keep the rates you think are 'right'. When you start filling up, ie- get halfway full, raise the remaining room rates and see what happens. I rarely have problems filling the remaining rooms at the higher prices.

 

I agree with Maddie. Do a bit of 'yield management.

Hillbilly's picture
Offline
Joined:
10/22/2011

That's a great idea! Kinda test the waters.

Offline
Joined:
01/12/2013

I like this idea also!  I think I will incorporate it into my busier months.  Hotels do this all the time, as do airlines.  The less rooms or seats remaining, the higher the price.  The closer the booking is to arrival date, the higher the price.  Why shouldn't we do the same?

Madeleine's picture
Offline
Joined:
09/29/2011

It's odd. Yes, hotels do that. Hotels here were charging $325 last weekend because they were down to 2-3 rooms. Could I get $175 for a room? Not a chance. This is what every caller said, 'It's off season! Why are you charging so much?' I sent all of those callers to the hotels.

Offline
Joined:
01/12/2013

The only difficulty with this is how to price it on your website or reservation program.  My website gives a "range" of prices, and they can call or go to the reservation page to get specifics for their date preference.  But if I raise the range on the website, I'm afraid that may put some people off.  And I'm not sure, but I don't think Rez Key has the capability to change prices depending on occupancy. 

Madeleine's picture
Offline
Joined:
09/29/2011

BananaE29 wrote:

The only difficulty with this is how to price it on your website or reservation program.  My website gives a "range" of prices, and they can call or go to the reservation page to get specifics for their date preference.  But if I raise the range on the website, I'm afraid that may put some people off.  And I'm not sure, but I don't think Rez Key has the capability to change prices depending on occupancy. 

I have a manual 'yield management' button. It's all manual. My range on my site includes my raising the rates as does the caveat 'rates may be higher due to local events, please check the calendar for exact prices.'

Have you ever noticed that no matter what your range is, they guest always assumes they will be getting the lowest rate no matter when they call? So, even tho my rates are say, $100-$150, and I only charge $130 they ALL want to know why it's not $100! No one ever asks when I charge $150!!!

Offline
Joined:
01/12/2013

Oh yes...all the time!  Why they think they will be getting the cheapest rate on a Saturday in high season is beyond me.  I wanna say "Well, what should I charge for a Wednesday in January then?"  Duh!

Madeleine's picture
Offline
Joined:
09/29/2011

Best are the ones who see the lowest price for the smallest room in the off season and want that for the largest room in peak season. 'Well, it says on your website the rooms are $75.' Honey, you want that room? Come back in March.

Arks's picture
Offline
Joined:
05/22/2010

BananaE29 wrote:

...I don't think Rez Key has the capability to change prices depending on occupancy. 

You'd have to set it up manually depending on occupancy. You can create a new Rate Plan whose rules assign it to only be active from a given start day to end day. During those dates, it takes precedent over your regular rate plan. You can set which rooms use the special rate plan.

OR, you can create a rate adjustment, with given start day and day, indicate who much it will mark up over the usual rate, and which rooms it applies to.

Offline
Joined:
01/12/2013

Ah...yes, you are correct.  Good thinking.  Thanks!

Country Girl's picture
Offline
Joined:
02/20/2009

If you are that busy, raise your rates. If business slows down you and can always revert to your old prices. Or you can raise them on the weekends and keep mid-week prices the same.

__________________

“I've learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.” Maya Angelou

 

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.