This is the third installment in our boot camp re-cap, and it’s all about getting the best return from your self-catering business.
In 2005, Robert and Melinda Kennedy, founders of SuperControl, achieved 98% occupancy in their holiday rental property, Cutlar’s Lodge. That’s not as good as it sounds.
Renting a property out every week of the year creates a lot of work. Your availability calendar may be full but your costs are higher and there is more wear and tear on the property.
In 2016 the same property increased it’s revenue by a whopping 30% with an occupancy of just 65%.
How did they do it?
By changing their strategy to optimise pricing, not occupancy. It’s called yield management; it’s getting the very best price for every booking you take and growing your profits without growing your costs.
The opportunity is to increase prices rather than reduce them and you need to analyse to optimise.
1. Research
When is demand highest?
Find out when school holidays start and finish (remember the dates vary throughout the UK and Ireland). What events are happening in your area? Are there any festivals or events that attract a lot of people? When are transport links in your area the most frequent?
What pricing patterns do your competitors follow? Why should guests choose you?
When do your competitors increase and decrease their prices? How far in advance do their availability calendars fill up? When demand is higher you can increase your prices. How does your holiday accommodation compare to theirs? What do you offer that they don’t?
What dates are guests looking for, and when do they start looking for them?
Tools like Google Analytics can provide you with key information about your guests buying behaviour. You can see what dates people are searching for and when they are searching for them. In this example, from 3-10 August the top three holiday dates that visitors to this holiday website searched for were 26 August and 16 September 2017, then 7 September 2018. Proof that some people research their holidays far in advance!
How far in advance do they book their holiday?
In SuperControl statistics, you can run a report to see your booking lead times. This is the number of days between placing the booking and starting the holiday. SuperControl shows an average lead time of 3 months, but it varies by property. If you have dates that are still available within this period, this is the time to mailshot previous guests that have booked with a relative short lead time in the past.
2. Be flexible and plan ahead
Being flexible with your start days and length of stay helps make your holiday rental more visible online. Not only on your own website, but on the big name sites like Booking.com and Airbnb (if you advertise on them). If you only offer full week stays you won’t appear in searches for shorter stays – so you are limiting your audience from the outset.
If you use SuperControl you can set up auto short breaks to automatically make your arrival days and length of stays more flexible within a chosen time period (which you choose) when you still have dates available. Just make sure you adjust your pricing for short breaks.
We also recommend that you add your prices as far in advance as possible, that way guests that want to book their holiday for next year can. The further people book in advance the less cost sensitive they tend to be; so you can set these prices high initially – then adjust them if the dates are still available as the arrival day approaches.
3. Increase demand
If you only rely on your own website, you are restricting your online audience. You won’t increase demand if you are being seen by the same people all the time. Cast your net wide and you’ll get seen by a lot more potential guests. This means advertising your holiday let on the big booking websites eg. Booking.com, HomeAway and Airbnb.
Advertising on lots of booking websites is made manageable by using a good channel manager. It removes the risk of double bookings, and saves a lot of time otherwise spent managing multiple listings.
Then simply nurture guests that first book with you via another channel, encouraging them to make repeat bookings direct with you.
