Latest Activity...
Market Maker's data comes from VRBO's internal system. Actually, it's likely the best and most accurate data of any pricing system out there. One key metric they have access to that PL/BP/WH don't is *demand* -- as in the number of searches being performed. Other pricing providers are predictive (based on calendars of events) and/or reactive (based on price movement of other listings in your area); only VRBO Market Maker can actually see where demand is spiking and react in real-time.
They also are fairly transparent with their interface--you can manually go in and edit your "Competitive Set" so that you can see and compare your rates with those of the properties near you that you specifically compete with. If you have a luxury 5-bedroom lodge with top amenities, you aren't really competing with the 5-"bedroom" double-wide mobile home with a lean-to add on that's one street over, so you can remove it from your competitive set and whatever that owner does with their rates won't affect yours. They also have extremely accurate and specific data on occupancy rates, whereas the other yield-management services can only guess (leading to things like owner block-offs causing falsely higher occupancy, etc.), as well as internal data on your listing's performance (views/clicks/inquiries/review scores/etc.), although I don't know to what extent they use that data in the MarketMaker product. The MarketMaker team also has the support of a very large corporation (VRBO, owned by Expedia) that has a ton of data and expertise in this area. They're not perfect, though, and I've corresponded with their support team quite a bit to help squash some pricing bugs that cropped up after they released an update a couple of years ago.
The big downfall to Market Maker is that a) it isn't automated, so you still have to manually go in and click "accept" on their pricing recommendations every day (unless they've changed it in the last year), and b) the data doesn't sync out to third-party software integrations (like OR), so you can't rely on it to adjust your Airbnb or direct-book rates. You could monitor it and manually update rates in OR whenever you feel like it, but I don't have that kind of time or patience.
That said, the third-party pricing services are pretty good at what they do, and pricing trends are pretty well studied and the math behind the whole science of yield management is an entire and well-developed branch of the field of data science, so as long as their source data is accurate, they all tend to be at least in the ballpark of adjusting your rates. You may need to take the reins a bit more in setting an accurate "base price" with all of them, though, whereas VRBO will pretty much tell you what your property's price should be.
One thing I completely forgot to mention before: the biggest difference between BeyondPricing and PriceLabs is the cost: BeyondPricing charges (like Wheelhouse) 1% of your rental rate, whereas PriceLabs charges a flat fee per month (starting at $19.99 per month, but it goes down significantly if you have additional properties). For a single property, that means that if you get at least $2,000 per month in revenue, BeyondPricing will end up being more expensive than PriceLabs (1% of $2,000 = $20), but if you're just renting a small, cheap condo part-time or in a slow season, BeyondPricing will end up costing you less.
Well, right now, everything goes out at (I think) 3am on whatever day you check.
I have a follow-up email that goes out the day after check-in welcoming them to our home, thanking them for their stay, and encouraging them to let us know if they have any questions/comments/concerns/maintenance that needs reporting/etc.
I also have a follow-up email that I send the day before check-out reminding them about check-out times and procedures (and again encouraging them to let us know how their stay was and if anything needs fixing--my goal is to reinforce the point numerous times to let US know of any issues instead of waiting to leave them in a review).
We see a lot of 2-night stays in our market. You can see where this goes--the guest receives the welcome AND the check-out reminder at the same time. That can be a little odd and confusing and also make it look less personal (you'd be surprised how many people reply to my email just thanking me for my concern and that I was so thoughtful! I'm like, you're welcome, but that was an automated message from an unfeeling computer, lol).
3am is rarely an ideal send-time anyway as people are not generally awake and reading their emails, and often emails that are sent overnight are not really read or dealt with in the morning (I know this from the half a million emails we send a week at my day job, LOL). So it would be nice to specifically send the welcome one at, say, 8am and the check-out reminder one at, say, 7pm.
Totally out of curiosity - what would need to be that time specific? I'm always looking for good ideas from other owners/managers.
Great work and looking forward to a time based automation. It would greatly enhance what I can do. Could a scheduled option (check out time) so an email would go out say 1 hour after check out time?
I don't see anything in particular that's amiss, can you send in a support ticket with the particular dates and issue you're having, with a screenshot?
First thing to do would be to ask them -- most will tell you if you're in a good market for them.
Next thing you can do is try them -- most of 'em have a free trial period where you can use their system, review the rates to see if they make sense, and see if you get more bookings.
Hi Katy,
That information is many years old. RentalGuardian is now our carrier and carries a better product line. TravelGuard was a great option at the time, but again that's many years old now.
Here's the information you want:
https://www.ownerrez.com/support/articles/configuring-travel-insurance-settings
Scroll to the bottom and look under the Insurance Policy Details for the links to include.
Can I send this Insurance company info to a guest before they book?
How would we know which of the available pricing engines would be best for our market? I own beachfront condos along the Alabama Gulf Coast and have used vrbo's "market maker" but really don't have any idea how their data is generated and how it would compare.
@Julie B, I did a bunch of research on this topic a year ago when Beyond Pricing entered my market. While I did not actually demo Beyond Pricing myself to see, the consensus from numerous online discussion forums was that PriceLabs has the best data, Wheelhouse has the second-best data and the best user interface, and Beyond Pricing's data was less accurate.
That information is a year old, and I can't vouch for it personally (and so it may be completely wrong), but it's my take from the research I did on the topic.
As well, different pricing providers can have varying strengths in different markets.
I'm not sure what's going on with rates but I can't figure out my monthly rate, though it shows set up correctly in the legacy settings, it does not show up correct when putting dates on the calendar. What am I missing?
How does this compare with PriceLabs?
Before you run home for the day, here's an exciting little Monday tidbit... OwnerRez now supports integration with Beyond Pricing!
For those of you that don't know, Beyond Pricing is a recognized leader in automated pricing for vacation rentals. The Beyond Pricing integration will dynamically insert rates into your OwnerRez account.
Like our other dynamic pricing integrations, Beyond Pricing will create spot rates automatically in your OwnerRez account every day or whenever their algorithms deem it necessary. Beyond Pricing will drive your OwnerRez rates - no need to lift a finger!
Kam Bain, Director of Strategy, Beyond Pricing says "Customers frequently contact our Support Team to request an integration with OwnerRez. OwnerRez was built by property managers, for property managers. It is this unique insight that ensures the PMS covers everything a property manager needs, from managing enquiries to offering travel insurance options. Their commitment to listening to feedback from their customers and building community around their users is great to see.”
Learn how to Integrate Beyond Pricing with Your OwnerRez Account.
Founded in 2013 by veterans of revenue management in the airline and hospitality space, Beyond Pricing is the world's first revenue management and dynamic pricing software for vacation rentals. Driven by big-data machine learning and predictive analytics, Beyond Pricing has priced over $4 billion in bookings for 300,000 listings in more than 7,000 cities.
Paul here from OwnerRez. 👋 In the age of Coronvirus, we know users are struggling with processors changing rules and locking down on future funding - even changing their policies mid stream. We've been talking to our friend David Goodale for awhile about the processing he does for Canadian merchants (and other international markets) and he had some thoughts to share. David's been doing this a long time, and he was kind enough to put together this article for OwnerRez users and a video as well. Please take a minute to read this thoroughly. You might know some of this already but probably not all of it. Enjoy!
By David Goodale, CEO Merchant-Accounts.ca
Many vacation rental owners have learned that their guests prefer to pay using a credit card. To accept credit card payments, you need a merchant account from a payment processor. There are many companies that offer these accounts, but what merchants often don't realize is the funding terms offered (how much, how often or how quickly you receive your funds) are not all the same.
What you want to avoid is a situation where the payment processor holds back a large portion of your funds when a transaction is processed. When funds are held back it's called having a "reserve" on the account.
For the uninitiated, a "reserve" means that the payment processor will hold back a portion of your funds for a period of time after each transaction is processed. This is usually specified at the point of approval when your account is setup. The percentage of funds held, and the length of time held will vary depending on both the processor itself and the criteria of your rental business.
The impact of this is important because your guest will have paid the money, but you may not receive access to all your funds until a point in the future. This is something that is obviously best to avoid, or at least minimize as much as possible.
In order to build a strategy to reduce or avoid reserves, and ultimately get paid sooner and improve your cashflow, we need to understand the risks as perceived by the processor. For example, right now Coronavirus is spreading across the globe. From a business perspective almost everyone is being hard hit, but travel-based businesses particularly so.
With a rash of cancellations, travel bans, and a poor near term outlook for the short term rentals market, we can easily see the risks associated with accommodation based businesses. From the payment processors perspective, they are worried about chargebacks where a cardholder has paid for something that they will no longer receive. These risks are why many payment processors require holdbacks, rolling reserves or other forms of financial collateral.
A chargeback occurs when a customer (a credit card holder, your guest) calls their bank, and requests that they forcibly reverse a transaction. This is a serious dispute and can occur for a number of reasons. Sometimes it's fraud, where the cardholder did not authorize the purchase; in other cases it can be because an item received might not be as described.
However, for travel merchants, the big risk is for undelivered services. In other words, something could prevent the purchaser from being able to use or stay at the accommodation they have paid for, so the service was not provided as promised. For example, consider the travel bans currently in place because of Coronavirus. Under the card rules, if the cardholder does not receive what was promised – which they can’t, since the government is prohibiting travel or short-term rentals – they are entitled to receive their money back no matter what.
This is the concept of "fulfillment" in the credit card industry. One of the principal protections built into credit card processing is that cardholders are guaranteed to receive what they have paid for. With that in mind, consider a typical retail merchant. If you sell pencil crayons and coloring books they'll ship out shortly, and the cardholder will receive their product soon after ordering. However, with vacation rentals the customer may be paying months or even years in advance of their arrival. This is the general concept of "future delivery" - the cardholder pays for something today, but the order remains unfulfilled until a future date.
The challenge with hotel and short term rental merchants (and broadly the entire travel sector in general) is that things can unexpectedly disrupt the supply of the service, and the payment processor will be left holding the bag for refunds that become due. For example, if a prominent group of hotels were to go out of business, then all of the people who had paid to stay there in the future would need to receive their money back.
The problem, if a company goes out of business, is that they won't have the money to return to the cardholder. Per the Visa and Mastercard guidelines, the cardholders are entitled their money back under a service-not-rendered dispute. If the money has to go back, but the hotel is out of business, where does the money come from? The credit card processor.
As the trading volumes become larger the risk becomes greater. This is called the "Future Delivery Risk" in the payments industry. In terms of the accommodations sector, payment processors could be worried about the following:
The risks start to get more remote as we read down the list (Godzilla does most of his fighting out in the deep ocean fortunately) - but the point is that any perceived risk is a risk to the processor. The more real and likely the risk, the more likely a merchant is to have a reserve (or some type of collateral requirement) put on their merchant account.
This question sounds simple but is actually complex. A single property or a business with a small number of short term units might be considered lower risk than a hotel because a lot less money is being traded.
However, consider the Hilton for a moment. Hilton Hotels have a lot of properties, a lot of assets, and a lot of rooms. If a room was damaged, or even if a whole building was damaged or unusable, it would be very unlikely to affect the entire chain – many guests could just transfer to a different Hilton down the street, and even if not, Hilton has plenty of cashflow to pay for the refund. To the payment processor, they just want to make sure someone is there to backstop the promises made to the cardholder and cover the refund if necessary. In that way Hilton Hotels is obviously low risk, because they are not in any danger of disappearing suddenly.
As we are discovering now, there are some unforeseen circumstances where even large entities can be vulnerable. For example, during this Coronavirus outbreak, Hilton Hotels could conceivably represent far, far more risk than a smaller short term rental business. If nobody can travel, then nobody is going to stay at any Hilton hotels anywhere at all. With no income whatsoever, a previously stable company might suddenly be in dire straits. And if Hilton were to go out of business, many millions of dollars would need to be returned to cardholders, for which the processor, at least conceivably, could become liable.
That is why the question of risk is specific to your business. Processors couldn't reasonably have predicted the Coronavirus, but they could conceive of a similar event occurring. What they can only try to model is the potential risk. From there, they can apply their models to different types of businesses.
That is why different processors have different terms of approvals. One processor might prefer to work with a large brand like Hilton because they feel it's rock solid, where another would prefer a smaller merchant because it's less money flowing through the account overall. It's very situationally specific, based upon the processors risk tolerance and attitude, and also the unique merits of your own business.
Now that we have a good grasp of the risk concepts, we can explore what you can do to lower the amount of collateral held by the payment processor for your account.
The biggest thing you can do to impact the amount of collateral held by the processor, is to minimize your far-in-advance deposits. I will admit, it may seem counter-intuitive to improve your cashflow by reducing the amount of money you collect upfront. However, if you can reasonably minimize the percentage of the deposit, you lower the perceived risk to the processor. This strategy may help with getting through the door with good terms of approval that won't put a hamper on your business.
For example, if you can live with only taking a 10% deposit upfront, you'll vastly reduce the future delivery and chargeback risk for the processor. This should only be a relatively short term thing though, as you can improve on this over time, which we'll explore below.
Another part of the process is to have business policies that stop disputes from occurring. For example, if you want to have a strict cancellation policy with no refunds, it's almost always better to have the cardholder call you than go straight to a dispute. In the refund area of your booking agreement the policy could say that, in the case of special or extenuating circumstances, refunds can be given at the discretion of management. This way, the customer will usually call you first rather than going straight to the bank and filing a dispute. It is to your benefit it you can work something out with the guest to keep disputes down. Generally speaking a refund is always better than a chargeback, unless you have a rock solid case or it involves a lot of money.
Perhaps the most important part of the strategy is understanding that it will take time to improve your situation, by building the relationship with your payment processor. As they get to know you, and as you become known to them, they will trust you more since they see you continuously operating in good standing. If a rental merchant has been with a processor for 10 years, they certainly should be getting more comfortable with your business. Over time they should be okay releasing more or all of your funds without a reserve. You may not get everything you want on day one, but you can and absolutely should work towards it. Working towards it involves several elements, but one of the most important is consideration of the financial picture.
With our Hilton Hotels example, the processor was much more comfortable because they knew Hilton was a large group with a lot of financial strength. You don't have to be a member of the Hilton family to get good terms of approval though. If you operate a business with a solid set of financials, or if you personally have a high net worth and are willing to sign a personal guarantee, you can provide these to the processor to ease their concern. For example, if you run 5 short term rental properties, all of them owned mortgage-free, and all of them having a regular set of guests who have been coming for years, wouldn’t this be lower risk than a new rentals business that is mortgaged to the hilt? Of course it would! These are the type of things that your financials will demonstrate. If you have a good financial story, you should be telling it to your processor, and if you have a good processor they will listen.
That communication with the processor should be an ongoing thing. It's a good idea to write a report annually on the status of your business. It should be very short (underwriter attention spans are short), but it needs to address the important points. This part will be highly specific to each individual business, but for example: pretend that you own 5 cabins in a rural nature setting. If these 5 cabins were of a similar build, it would mean that if one was damaged you could simply move guests to another cabin without affecting a booking. If you compare this to someone with just one rental unit, their probability of an issue or problem causing a cancellation of bookings is much higher. Think of the intangibles that they might not be aware of, but that they should be, and tell them. Just be sure to keep it succinct.
Also, it's no good if you are working with a payment processor that isn't receptive to this information. This tends to be hit or miss depending on the payment processor. Some are quite receptive and appreciative of this information, as it helps them to underwrite and monitor their book of business more accurately. Others, particularly large and slower moving processors may not be able to action this information as effectively. That's why it's important to find a processor that is specialized at working with travel and accommodations merchants, like we are at Merchant-Accounts.ca.
As you build your case with annual reports, an improving financial position, keeping disputes low and as they get to know you, you should be asking for improved terms. If they have collateral on your account, then ask to have it removed. If you are only taking 10% upfront, ask them if you can change it to 25% upfront, especially if you have the same returning guests year over year. Most of all, don't be afraid to ask the question, especially over time. It should be an ongoing and evolving, to your benefit. Of course, if your business is in rough financial shape, or if things aren't going well (for example during Coronavirus) it might not be the best time to ask for a review. So make sure you are putting your best foot forward, be honest, be concise, and be confident. If you operate a good stable business they should be willing to work with you.
This discussion has been mostly about reserves, but there’s one final point to make:
Don't ever let your payment processor raise your rates.
Unless interchange fees have increased there is never a reason to increase a rate on a merchant, except in exceptional circumstances where your business performance has deteriorated or you are getting a lot of chargebacks. If anything happens that causes your costs to go up from your credit card processor, you should challenge it in the strongest possible way. If they still insist on raising your costs, you should switch payment processors. This is especially easy if you are Canadian, since the code of conduct for the credit card industry allows a merchant to move processors at any time if a cost is increased to a merchant. (Again, except where interchange as set directly by Visa or Mastercard has increased – that applies to everyone equally and your processor has no control over it).
Mostly, this discussion has been about arming you with the knowledge to be able to negotiate with your payment processor. The processor should want your business, and accommodation-based merchants can make excellent clients. If you can look through the processor’s eyes and adjust your policies to address some of their concerns, then you should be able to work together to reach a good agreement. Perhaps most of all, remember that it's an evolving partnership and that you should be able to continue to improve your terms over time. You are bringing something to the table and they should be happy to have your business.
If they aren’t, reach out to Merchant-Accounts.ca to get a quote, particularly if your business is based in Canada, the UK or the EU.
About the Author
David Goodale is CEO of Merchant-Accounts.ca and has 20 years of expertise in online payments. David often works with travel merchants and related businesses that have particular challenges when it comes to payment processing, both in terms of rates and reserves or holdbacks. If you have a question David can be reached at david.goodale@merchant-accounts.ca.
I'm really wishing I hadn't switched from the legacy rates editor. Having a few problems:
-I define weekend nights differently depending on the time of the year (eg, off season, weekends are Friday and Saturday, in season, weekends are Friday, Sat, Sunday nights), so being forced to define weekends once for all dates necessitates overriding seasonal rates with spot rates.
-Not being able to set weekly rates is incredibly cumbersome. My weekly discount varies depending on the time of the year, and sometimes even week by week. So now I have to make spot rates for just about everything, making seasonal rates pretty much useless for me.
I'm trying to finish my setup and this has been a major setback for me since I thought my rates were all set and didn't realize that the new seasonal editor would have fewer options than the legacy editor.
I also find it cumbersome to have to define the season dates and minimum stay length separately from where you edit the rates. Why not have that all be in one place?
THANK YOU!
This is AWESOME! I always had a hard time with BDC reservations.
After setting up my length of stay discounts is there a way for my weekly or monthly rates to show in the website?
There are a couple of ways to do this.
If you are NOT using our API connection to HA/VRBO, then you are using iCal imports. You can set these to "Import Bookings only". Then, in your VRBO control panel, you can create whatever blocks you like. They won't be imported to OwnerRez or block anywhere other than VRBO.
If you are using our API connection to HA/VRBO, then you can Change Settings in the HomeAway API controls in OwnerRez, and restrict the days-in-advance that you allow bookings on that channel. You could set it to 1 to basically forbid all bookings, or to 30 to only allow bookings within the next month, etc.
Is it possible to block my OwnerRez calendar from VRBO but still have it available for my customers to book on line? Then when the date gets closer unblock it?
You'd set that up as a Length-of-Stay discount as described here:
https://www.ownerrez.com/support/articles/length-of-stay-discounts
How do I do a weekly discount?
One of the things that's become clear through the coronavirus happenings is that additional levels of control over bookings are very useful even for channel based bookings. Last month we added the Cancel For Any Reason (CFAR) option for Travel Insurance and made canceled bookings more visible in lists and filters and exports.
We've spent the last couple of weeks developing several more in depth features: Required/prep time between bookings and the option to unlink bookings from channel API calendars so you can move them independently.
This option is available in the Changeover Restrictions section of each property's rules. If you want to require a gap between bookings for cleaning etc. you can control that here. The resulting block will be validated for direct bookings and also sent to API based channel integrations.
While we were working in the rules area, we also added an option to use a specific minimum nights in gaps as well as improved and simplified the interface for availability rules in general. Read all about it in our Availability Rules guide.
This has been requested for a very long time. Before, bookings for API integrated channels were controlled by the channel and you would have to make all changes on the channel side -- which means that you could only move bookings around as supported by the channel.
Now, you've got the option to unlink the booking from the channel calendar when moving it around. You should still make the change on the channel if you can, but this allows you to make any other changes regardless of whether the channel allows it or not.
We've also had manual modes for charges and transactions for awhile. Check out our article on Manual Modes for all of the details on the different types of manual modes.
Thanks, Paul! I see it now.
Dewey Getaway said:
Where do we put an address on file? I checked my profile and don't see a place to enter the address.Each property needs to have an address. So go to Properties menu > click on a property to drill in > click the Location tab on the sidebar > change button > fill in address and save. This gives the insurance carrier a destination address when the policy is purchased. If the property has no address, a policy cannot be issued as there is no destination. Also, the carrier cannot verify rules that govern the destination (some consumers cannot buy insurance for certain destinations or the carrier may have that area of the world blacklisted).
Thanks! This post mentions "remember that properties need to have an address on file in order for travel insurance to work." Where do we put an address on file? I checked my profile and don't see a place to enter the address.
Paul W said:
one of the fundamental tenants of insurance law is that it must be something the consumer chose to buy.
Here's a link to info which can be found in OR support docs. There's other info out there which can be found by searching "Travel Insurance."
https://cdn.orez.io/wcnv/docs/RentalGuardian%20-%20Overview.pdf?v=0116da11ea74cfb3b939b87f3a2c5dc676da5f83
What is the travel insurance company that OwnerRez is partnered with?
JTVRs has a good point. There is nothing worse than losing a bookkeeper and having no clue how to take over the job or train another bookkeeper. It is essential in small biz to know what is going on.
That said I do not want to stay in this industry if I have to do every single task to make it work. That is where OR comes in.
Please finish the job of automating the VR workflow and you will gain our undying thanks and loyalty.
