VRBO's new dynamic pricing tool - Free.

[Michael Baum]

Hey everyone, I see that VRBO has a new dynamic pricing tool that is free. I first dismissed it as a way to race to the bottom so that they can keep making cashola off us like AirBNB's does.

However, @John Underwood in another thread said he has been using it for a week and is liking what he see's so I figured I would start a thread on it.

Looking for discussion and people who have tried it out and their opinions.

[JD Martin]

Quote from @Andrew Steffens:

Quote from @Patricia Andriolo-Bull:

Quote from @Andrew Steffens:

While I find it interesting I think VRBO (like Airbnb) benefit from us lowering rates and getting more booking for less money so I feel there is a conflict of interest.

 Not sure I agree with this.  They are paid on a percentage basis from both hosts and guests.  It's the same supply demand question that comes up on rates all the time.  They want to maximize their profits not just get more low rate rentals.  VRBO and Airbnb have a ton of data.  They should be able to offer this service for free to their hosts and provide a value add for their fees.  They know their hosts are using pricing tools for a cost.  I wouldn't be surprised if they then say they added this valuable feature and try to increase host pricing though.

 I think on their level of scale they want to see lower rates to better compete with other accommodations and get more bookings.  Airbnb's dynamic pricing is often laughable compared to what my software/live revenue manager come in at. 

 Agree 100%. Both platforms push high volume, low price models because that is in their best interest. The incremental value of a higher priced booking can't offset the loss of bookings at the lower end. If you view their search results enough you will see that low price trumps almost everything else; there's no other logical reason why a host with a 4.1 rating with say 40 reviews would come up higher in a search than one with a 5.0 with 25 reviews, all else but price being equal.