To maximize revenue from your Navarre Beach rental, we highly advise against the "set it and forget it" approach when it comes to nightly fees. As long-time rental managers in Florida, we understand the importance of developing a dynamic pricing strategy to boost your rental revenue, just like the pros do.
Similar to airlines and major hotel chains, a dynamic pricing strategy works well for Navarre Beach vacation rentals. It involves closely monitoring the competition, market factors, and variations in demand. At Navarre Beach Properties, we rely on a team of professional vacation managers to keep an eye on everything and adjust rates accordingly.
Over the years, with a hands-on approach to helping rental owners boost their revenues, we've developed a keen knowledge of revenue management that consistently outperforms market standards.
Curious to know how everything works?
Below, we'll share with you our fundamental dynamic pricing rules and other valuable insights about revenue.
1. We consider occupancy a primary factor.
At Navarre Beach Properties, our primary focus is on occupancy. We consistently strive to have heads in beds at the best possible price. If offering a discount is necessary to secure bookings for our rentals, we are willing to do so. Our philosophy is grounded in the understanding that once a night has passed, it cannot be booked again, making it a perishable inventory that we don't want to lose.
Our pricing strategy aligns with this mindset and adjusts according to the time of year. Our goal is to maintain an ideal occupancy level of 65-75% for the upcoming month at any given time. During our regular booking window, we aim for high-quality bookings. Once this period has passed, we focus on minimizing vacancies with last-minute pricing.
To achieve this ideal occupancy rate, we closely monitor the competition, ensuring that we set a competitive price compared to beach rentals similar to our properties. We recognize that different types of rentals require distinct pricing dynamics, so our focus is on analyzing properties of similar sizes and amenities to ours, as they directly impact our booking patterns.
Additionally, we closely monitor demand trends. When we observe a spike in bookings in our region, we quickly align our rates to the trend, and this happens particularly during peak seasons and popular events.
As you can probably tell by now, our strategy embraces variability. Considering our average booking duration is of approximately 4.5 nights, a single reservation within a month can cause a 10-20% fluctuation in our occupancy. Instead of getting overly concerned if we stand at 50% when aiming for a 75% occupancy for the upcoming month, we adopt a flexible strategy. We study the situation and adapt ourselves to accommodate the bookings that are possible.
Pro tip: at Navarre Beach Properties, we not only adopt a proactive approach to revenue optimization but also rely on excellent software platforms to monitor demand and competition. Two fantastic tools are KeyData and AirDNA.
At Navarre Beach Properties, we always advise homeowners to avoid the "set it and forget it" approach. The right path to follow in the revenue game is to closely monitor market trends and the competition to adjust your pricing strategy accordingly.
2. We watch our booking window closely.
In vacation rentals and the hospitality industry in general, your "booking window" means the timeframe between the moment guests book your beach rental online and the moment they check in. Monitoring booking windows can provide valuable insights, such as information about how guests typically make reservations and other patterns in demand that you can leverage to optimize pricing.
For our condos and homes in Navarre Beach, the booking windows are normally three to four weeks. In this case, it's normal not to have bookings popping up four or five weeks in advance.
On an inverted logic, if we see too many bookings popping up before our booking window, this is probably because we're underestimating our rental's worth, and there's room for raising prices.
3. We take seasonality seriously.
At Navarre Beach Rentals, we carefully consider our optimization strategies in a manner that's directly linked to seasonality.
Even if Florida boasts excellent weather and a pleasant subtropical climate, attracting visitors all year round, we still have to consider seasonality.
These are patterns to keep in mind:
During the slower months, you should charge lower rates to attract more bookings;
During shoulder seasons, maintain moderate rates
Make use of premium rates for when the demand is at its peak.
When it comes to Florida, we can't discard those guests who like to escape from low temperatures and find refuge on our warm shores during winter — the so-called "snowbirds."
4. We also consider holidays and local events.
Besides seasonality, we also adjust our rates for holidays and local events. As we mentioned before, our vacation rental inventory is time-sensitive, which means if we lose an opportunity, we miss the chance to fill out rooms.
Having that in mind, we don't avoid giving last-minute discounts. Even if we offer several of these "special rates" a month, when needed, of course, they still add up to a significant sum by the end of the year.
5. WE PRICE DIFFERENTLY FOR WEEKDAYS AND WEEKENDS.
In many sectors of our market, there is lower demand on weekdays, from Sunday to Thursday, typically. Considering the reduced demand, it's a good idea to decrease the nightly fees a bit to ensure you'll get bookings during these slower days. On the other hand, don't refrain from charging more on weekends.
6. WE CONSIDER DECOR & ATTRIBUTES.
Paying attention to demand and competition is a major aspect of creating a great revenue optimization strategy, but there are other elements you should consider: the amenities you offer and your décor.
When it comes to amenities, a critical area you should pay lots of attention to is the kitchen. Nowadays, most guests expect to find a modern and well-equipped kitchen with top-notch appliances. People enjoy cooking during holidays, creating wonderful memories with friends and family as they don their chef's hats.
Hot tubs are getting increasingly popular in our segment, and private pools, or pool access for condos, will certainly give a boost to your fees. Keep in mind that the larger your property gets, the more amenities you should add to it.
Investing in interior design is another key to driving your fees up. A beach rental with modern and well-thought-out décor will undoubtedly do better than outdated and uninspiring properties. A good idea is to include some spaces with Instagrammable elements to grab people's attention when they are searching for rentals online.
For more valuable tips, read this blog on decoration tips and learn how to make your beach rental shine above the competition.
Adjusting nightly rates according to events that happen in your area is a great way to boost revenue as well.
Dynamic Pricing & Other Revenue Rules for Your Navarre Beach Rental.
As we can see, monitoring market data and keeping an eye on your competition, while adjusting your prices according to all the factors discussed above, will make a significant difference to your revenue at the end of the year.
If things ever get too complicated for you, remember, there's help out there. Property managers in Navarre Beach, like us, will take care of revenue strategies for you and alleviate the load off your shoulders.
Read more tips on Navarre property management on our blog! There are lots of professional tips and insider gems waiting for you there!
