Understanding Minimum Pricing Strategies

In this guide, we will explore common mistakes made when setting the minimum price and how to avoid them. Properly setting your minimum price is crucial for maximizing bookings, especially during low-demand periods.

Common Mistakes in Setting Minimum Price

• Setting Minimum Price Too Close to Base Price: One of the most frequent errors is setting the minimum price too close to the base price. We recommend maintaining a 20-30% difference between the base price and minimum price. This allows for sufficient room for price reductions during low-demand periods.

• Minimum Price Too High for Low-Demand Dates: If the minimum price is too high, prices will be capped at this higher rate, preventing bookings during slow market periods.

• Not Setting a Minimum Price: The biggest red flag is not setting a minimum price at all. Without it, you risk accepting bookings at rates lower than desired, potentially leading to losses.

Importance of Setting a Minimum Price

Setting a minimum price ensures that you do not accept bookings below your comfort zone. It provides a safeguard against incurring losses if rates drop unexpectedly.

Example and Features in PriceLabs

Assuming your minimum price is set correctly, let's explore what you can do with your listing in PriceLabs:

• In this example, the minimum price is set at 70, and the base price is 188, providing a sufficient gap of more than 20 to 30%.

• Utilize the Add Metrics button on the dashboard. By selecting Add Metric, you can view the Minimum Price Hitting Dates metric, which is particularly insightful for last-minute dates.

• Check the percentage of nights in the next 7 and 15 days that are hitting your minimum price. If this number is high, consider reducing your minimum price to increase booking opportunities.

Our goal is to ensure that the minimum price hitting dates for the next 7 and 15 days are low. If your minimum price is set correctly, you can proceed to the next step in optimizing your pricing strategy.

Thank you for following this guide on setting minimum prices effectively.