There are many factors that need to be considered as you determine the right pricing strategy for your B&B.
B&B pricing strategies will vary based on the size of the hotel, the location of the hotel and the competitors surrounding the property.
You need to have a solid understanding of the booking patterns at your hotel and other relevant data for your property, while also being able to clearly identify your target audiences as well as your competitors.
Revenue management technology can be used to help you understand the current market conditions and how those conditions may impact their rates and availability.
The right technology system will not only gather significant data related to your hotel booking trends and economic conditions in your region, but it also will analyze that data in order to provide you with guidance as you create a revenue management strategy for your hotel.
There are key B&B revenue management questions that need to be addressed before you decide on one of the hotel pricing strategies for your property:
1. What is the best pricing strategy for your target guests?
You need to know what your target audience is most motivated by when they are booking a hotel in your destination. For example, if you are a hostel who caters to millennial travelers, you will likely want to create a pricing strategy that allows you to offer low base rates and extras that enable you to earn more per traveler.
2. What is the best pricing strategy for your specific B&B?
You need to determine the budgetary needs of your B&B as you decide on a pricing strategy. Ultimately, you want to choose a strategy that increases your bookings while also allowing you to continually generate more revenue.
3. How will the pricing strategy that you choose impact your distribution channels?
If you rely heavily on OTAs, you may want to consider the pricing strategies that work best for them as you develop your B&Bs rates and revenue management strategy.
Your pricing strategy will have a significant impact on your distribution channels, so you will want to consider them as you make final revenue management decisions.
There are several B&B pricing strategies to consider for your hotel.
One of the most common pricing strategies is the high-low strategy, which requires you to price motivating items at a low price.
For a B&B, this would mean offering a low room rate in order to attract customers and prevent them from booking with competitor hotelss in the area. Then, offer other options at a high-margin price.
These items might include extras, such as wine and cheese packages, or rooms with a premium view or location within the property.
You also may want to consider a strategy that offers a higher base price, giving you plenty of opportunity to lower your room rates during promotional periods. By lowering your rates from the higher base, customers will think they are getting a great deal. Remember, it’s always better to reduce your rates rather than increase them once they’re live.
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