June 9, 2022
How to Drive Owner Referrals With Dynamic Pricing
How to Drive Owner Referrals With Dynamic Pricing
Along with things like reasonable commission rates and skilled staff, one of the top things vacation rental homeowners look for in their property management company is the potential to make an excellent return on their investment. So it makes sense that you would highlight your highly effective dynamic pricing strategy to potential owners, right?
Homeowner referrals are one of the surest ways to increase your vacation rental business inventory. Here’s how you can use your dynamic pricing strategy as a marketing tool to drive vacation rental owner referrals.
But First: Do You Have a Homeowner Referral Program?
Property managers get a lot of referrals through the good ol’ fashioned grapevine. So why not build a more formal homeowner referral program?
Consider all of the different avenues you could possibly tap for homeowner referrals: real estate agents in the area, loan officers, insurance agents, local business owners, and—most importantly—your own, very happy vacation rental owners! Then, develop some program details, including incentives. These will be different depending on the source of the owner referral: vacation rental homeowners may exchange referrals for preferential commission rates or similar monetary incentives, whereas other professionals like real estate agents or local business owners may trade referrals for some exclusive partnership rights or referrals for themselves.
Then it’s time to advertise! Add a homeowner referral program email to your homeowner nurture series, and include the question, “how did you hear about us?” on inquiry forms from potential homeowners. Reach out to other industry professionals and discuss the terms for a referral exchange or the like, and get those interested set up with contact cards that they can pass on.
Let the Data Do the Talking
What’s the next best way to show potential homeowners how well your dynamic pricing strategy works, apart from word-of-mouth? Really awesome data, which we know you have—in abundance! Use third-party data alongside the authoritative data from your own systems to show how dynamic pricing has helped your current homeowners meet their occupancy and revenue goals. You can even develop sample models of how your dynamic pricing strategy could work for different size vacation rental properties (even if you don’t know the exact property your potential owners have, you can make good guesses based on the market and your own portfolio).
Share Owner Success Stories
Nothing is more enticing than real stories from real vacation rental homeowners. This can look like an in-depth case study of one or two homeowners that you share in your new owner emails (make sure you show the love to the homeowners who participate!) or soliciting reviews from your owners and sharing them on your website and social media platforms.
Explain Your Stance On Restrictions
When it comes to speaking with your vacation property owners (current or potential), it’s important to be as transparent and clear as possible. Vacation rental homeowners may feel pressure to keep minimum stay requirements high, hike up fees to cover any potential damage or believe in a “set it and forget it” model when it comes to rates. It’s your job as the vacation rental expert to steer them away from practices that may restrict their revenue.
You can help inform this conversation by discussing their short- and long-term goals for their rental, offering a realistic evaluation of their property, and sharing data (see above) showing how a dynamic pricing strategy can help them make a return on their investment—and then some.
Lean On Expert Input
Creating an informed dynamic pricing strategy can be a huge lift. Thankfully, there are tools out there—like Rented’s Automated Rates Too, or Art—that can help streamline the process, from recommending nightly rates to allowing for batch adjustments. Rented’s team of revenue management experts can guide your pricing adjustments based on your market, the industry as a whole, the season, and minute factors like access and amenity availability that only a human can take into account. Reach out to one of Rented’s experts today to talk about driving homeowner referrals with your dynamic pricing strategy.
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