[Ep 12] Pricelabs Dynamic Pricing Software

Superhost Unveiled

One of the key factors for success as a short-term rental is keeping your property occupied at the best rate. Today, one of the founders of Pricelabs, Anurag Verma, joined the podcast to share how their company is helping thousands of short-term rental owners maximize their revenue with their dynamic pricing software.

The company began when one of the co-founders started an Airbnb but had no idea how to price it. Verma was working at an airline at the time helping them with their pricing and knew that it's likely that many people are struggling to price their short-term rentals effectively. Knowing the engineering and math to the solution to their problem they set out to create a dynamic pricing software for short-term rentals so that hosts can automate their pricing for their properties confidently,

At first, they were the only people creating dynamic pricing software for short-term rentals. The company started in Chicago and reached out directly to hosts located in Chicago via Facebook groups. When they launched, they only started with 10-15 properties. For the first year, the app was completely free to allow for testing and to get feedback. After a few months, they expanded out of Chicago to the entire world. Most of their initial customers came from Europe in particular where the short-term rental industry is huge.

Dynamic pricing is all about figuring out trends within the market. If you have a huge event that causes properties to get booked out at max capacity at high rates, and your property is priced low, then you missed out on a bigger booking. Hotels have it easier because they have several rooms that allow them to notice trends. If they notice that 5 of their rooms got booked way in advance, it's a good sign that that time will be really popular for bookings and they can raise their rates. Dynamic pricing software allows hosts with only 1 property to pick up on the trends and don't miss out on a larger booking, just like a hotel would.

As an owner, without dynamic pricing, it's easy to use preconceived highs and lows for your property that can end up costing you money. As a host at the beginning, Peter left thousands of dollars unclaimed due to missing out on trends and things like orphan days.

Pricelabs allows you to maximize bookings that are far out. For example, 6 months in the future, the app can restrict bookings to a certain day booking such as 5-day stays versus 2 nights only. As the date gets closer, the app adapts the length of the booking to capitalize on stays. Therefore, instead of restricting it to 5 days throughout, the app will allow guests to pick up the leftover days so that you can have a higher occupancy rate. If there is an orphan day or orphan 2 days, Pricelabs can jack up the price to make it equivalent to 3 or 4 days booking while booking that day so that your calendar is booked solid.

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