well welcome back to the Short-Term Rental Riches podcast. I’m happy you’re here again. Today we’re diving into platform promotions. I know these have been confusing a lot of hosts lately. I’m talking about those Airbnb promotions, the booking.com discounts.

The VRBO promotions that seem to be everywhere, but we don’t know how well they actually work. Well, I’m gonna show you this week how they work, whether they’re worth it, and most importantly, a way that you can use them without slashing your prices or killing your profit margins. Stay tuned. Let’s jump in all that.

let’s go ahead and just start off with Airbnb. One that you may have seen is their early bird discount, this will apply for any of your properties within the next 24 months if you’ve applied a 3% discount or more.

If you’re using Airbnb’s smart pricing, I hope that you’re not, I hope you’re using one of the dynamic pricing tools like Price Labs that we talk about all the time on this channel.

But if you are using Airbnb’s smart pricing, you wanna make sure you turn that off.

 in order for this promotion to show up.

The benefit to adding any of these special promotions is as you get more visibility. So we’re gonna talk about each of these individually. But for the early bird discount, you will get a special call out on your listing on Airbnb.

The next one will be a last minute discount for any discount that you’ve applied for 10% or more. And again, this is going to give you a little more visibility. When a guest is looking at your property on Airbnb, they’re gonna see a slash through your price with the discounted price.

To set it up, you just go to pricing in your Airbnb dashboard and you go to the discount section.

Okay,

next one up is a length of stay discount. So Airbnb gives you the flexibility to discount whatever length of stay you want. And so sometimes this could work well if you have maybe a gap from Tuesday to Thursday that you know isn’t going to get booked well, you can apply that in there. And again, you’re gonna get some more visibility.

When that guest goes to book, you’re gonna see a slash through the price.

Now for any of you starting a brand new listing on an Airbnb, first of all, congratulations, there is a 20% discount that Airbnb will try to automatically apply for your first three reservations. It’s optional, you don’t have to use it, but it does give you a lot of that extra visibility.

And we do know that charging a lower price. For a property that has zero reviews, helps at least with the value component for your property, and a lot of times can help you ensure that you’re gonna get really good reviews right off the bat.

And lastly on Airbnb, we have what they call their special promotions, which is just that you can go into any timeframe you want, any days and add an additional discount to your property.

And if it’s over 15%, then you’re gonna get a lot of increase. Visibility, but does all of this visibility actually help you get more bookings? We’re gonna jump through VRBO and booking.com, and then we will get into that and also a way where you can apply these promotions without actually discounting your prices.

Now let’s jump over to VRBO or HomeAway, and many of you probably don’t know, but they also have this new listing, 20% discount, just like Airbnb. 

We know that all of the OTAs want you to drop your prices, basically as far as you can so that they get more bookings. That’s one of the things that we see with Airbnb’s smart pricing, is that they just drop your prices way too low,

but with a brand new listing, it’s not a bad idea to have slightly lower prices than you normally would have to help build up that solid foundation of reviews and get you off to a really good start.

Next up on VRBO, they have an early booking promotion where if you offer a 5% or more discount for reservations made 60 days or more in the future, then you get some additional visibility.

Most all of the VRBO configurations you’re gonna find by going to calendar, then settings, and then promotions in your dashboard.

That’s where you’re gonna be able to apply these changes directly with VRBO.

And remember that these special promotions, most of the time have to be applied directly on the OTA, directly on VRBO or Airbnb. They’re not going to get applied through your dynamic pricing tools. So if you’re using Price Labs or you’re using Air DNA or Wheelhouse, and you’re using that for all your dynamic pricing, it’s not going to have these options for the special promotions.

Your PMS software, however, may have the ability to do some of these, but from our experience, it’s usually very limited.

So what that means, of course, is that if you’re applying these discounts directly on the channel, your pricing software doesn’t know that, so you could be applying double discounts. We have a way to combat that in just one second. I’ll get to it, I promise.

VRBO also has a mobile only promotion, a discount that you can apply for anyone booking through their mobile. And we know Airbnb over 50% of all the reservations. Come from mobile. So when you’re setting up your listing online, make sure that you look at it in mobile format. Airbnb, for example, has a set amount of characters that fit on the mobile title versus the desktop version. These are all little things that make a big difference and you want to double check.

And on to booking.com. I know that not all of you are on booking.com, but you really, really should be.

We will find that a lot of their discounts are very similar to what’s on VRBO or Airbnb. But if you really get into the weeds with booking.com, they have way more discounts that you can apply. But some of the ones that are very familiar and early bird discounts, so they have this. VRBO has this where you can apply a discount for guests to make a reservation a certain amount of time in advance.

All these changes with booking.com again are going to happen directly on booking.com are what they call their extra net 

The extra net is essentially your dashboard where you handle all of your listings online. booking.com also has a last minute deal, not surprising, just like VRBO, just like Airbnb,

booking.com also has a mobile only rate. Same deal. You apply a discount for people that book through mobile only. You get a little extra visibility and it’s interesting to see VRBO and booking.com and all of these different OTAs except for Airbnb at the moment, offering this mobile discount. If we think about it, people have their mobile with them, their cell phone.

Basically the whole day, right? Versus being on the computer. So the chances of them making a reservation on booking.com or VRBO is much higher, right?

And so by offering this additional visibility and discount, it’s essentially enticing all of us, all of their users, to move towards the mobile version.

Booking.com has another discount in terms of loyalty. So VRBO Airbnb do not have this yet, but it’s basically rewarding guests for continuing to use booking dot com’s platform and it’s their genius program. Now, I actually use this a lot.

I spend a lot of time outside of the US and the Airbnb. The short term rental options aren’t that great, depending on where you’re at. booking.com is reliable, it’s consistent, and these loyalty programs, they really do give you that extra nudge to book a property. You’ll see right on the listing there’s a 10% discount or 20%.

It can vary with this genius program.

But on the backend, as a host or property owner, this isn’t something that’s gonna be applied automatically. You’d have to opt into the Genius program, and assuming you do, you’ll get more visibility. You’ll show up higher in the search ranking results.

So what do all these promotions do? Well, in a nutshell, they give you more visibility. They promise that you’ll be higher in the search rankings. And ultimately that means that you should be getting more reservations.

Now we don’t actually know with a hundred percent certainty how much impact these promotions have. In fact, we’ve gone through a lot of the data on the backend for partners that have joined us, that have applied a whole lot of special promotions and found that it didn’t really have that much impact.

The more important thing is making sure that your pricing is always perfect, right? And we talk a lot about that on this channel. If you’re new to the show, you can go to str riches.com. You’ll find lots of eBooks for free. All of our past episodes where we really break down anything and everything that has to do with your short term rental.

Now, there is one thing that we know for certain is that there is a psychological component to seeing a discounted property, right? just the same way it is if you’re at the store or the mall or you’re buying a car or whatever it happens to be. If you know that the price that you’re paying is lower than what the price normally is, well you just psychologically are gonna be more inclined to make that book and to make that purchase.

And so how can we get the benefit of these promotions, the visibility, the improved search ranking results, and also not discount our pricing? Well, I saved the best for last. The way that we’re going to do this is we’re gonna use our dynamic pricing tool to send out all of these prices to booking.com and Airbnb and VRBO, but then within our PMS software, our property management software, if you’re not using a PMS program, then unfortunately this would not be an option for you.

But we have what we call markups and we can set specific markups. Per channel. So let’s say that you’ve added an additional 20% of discounts to booking.com. You could come into your PMS software and mark up just that channel by 20%, which means that the channel’s not gonna know, right? They’re discounting your price by 20%, but you’re marking it back up.

So you get the visibility, you get those search ranking increases, and you’re not missing out on any revenue.

Of course the more of these discounts, the more of these promotions that you put in place, the more of a juggling act that becomes, right? If you’re doing this across all the different platforms, then you really gotta make sure you’re monitoring things really closely. And if you don’t mark them up,

But you’re adding promotions on maybe one specific channel. Well, what’s gonna happen is you’re gonna start to get more bookings on that channel because your prices are going to be lower and you’re really gonna build a lot more traction there, but you’re gonna be missing out on the other channels.

And we wanna make sure that we stay diversified, right? We know that Airbnb just changed their commission structure and these OTAs have a lot of power over what they can do with our properties. So the more diversified and the more evenly distributed we are across these platforms,

the safer and more secure our properties will be and the more consistent our revenue will be.

So that’s a wrap on promotions. These things are changing all the time. I wish I had the hard, concrete facts to say that this promotion worked better than this one, but I think the safest bet is just to make sure that your pricing is consistent across the different platforms. You can take advantage of these promotions by marking it up afterwards on your PMS.

And believe me, our team is looking at all this data on a regular basis. Trying to come up with the hard concrete facts for you, so when we know for certain that one special promotion is much better than another one, we’ll be the first to let you know.

Until next time, I hope you have a fabulous week.