01. Audience & pricing.

10/10 times, when I’m working with a client one-on-one, the first thing they ask is, “So…what are we going to do with the styling?” Which is when I slow them down and ask, “Well, before that, do you know who your audience is?” Nearly always they don’t and, though it sounds illogical, that’s the exact place we want to begin. Knowing your audience is crucial to know how you should tell you story — in fact, it’s something that will set you apart from 98% of the other rentals out there. How so? Because when you know who your audience is, you know how to connect with them, rather than trying to connect with everyone by trying to be everything. I know it may not seem like much, but getting clear on who your audience is is really one of the most powerful things I can teach you. Every decision you make from here on out should revolved around who they are and I am confident this is how you create a home that brings you well above the market’s nightly average.

Let’s begin with our video overview.

 
 
 
 

01. Ponder this.

“Knowledge sets us free, art sets us free. A great library is freedom,”

— Ursula K. Le Guin


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01. Lesson: Audience.

If you want a rental that’s always booked, every night of the year, the audience you should be targeting is Couples. This works out because if you’re targeting Family and Group, you’re only really going to get booked on school holidays and weekends because families and groups are budget conscious travelers looking to book based on price. In contrast, couples have a larger disposable income (on average), generally do not have kids, and tend to book their holidays based on emotion, not price. This is your sweet spot.

The second thing to understand when targeting your audience is that it’s usually the woman or one partner who is more invested in the emotion of the holiday rather than the practicality of it. This is the person who makes the decision on booking. Something sneaky to note is that when you successfully target the Couple as your audience, you also capture the Individual Traveler, the Family and the Group —- this makes it the most efficient, considered, and effective approach to take. Well done!


Marketing 101.

I want to bring us back up to some high-level thinking for this next part. Now that you know you’re targeting couples, how do you go about it? Well, in marketing (which is the business you’re now in — hosting, too, but marketing a bit more than you may have thought) we want to be clear on who our audience is first because, once we have that, we then tailor every single thing we do to that person. The images we use, how we speak, everything is tailored to who they are. Remember that you’re selling the emotional experience of your property, not the practicality of it. This key difference in how you go about speaking to your audience is what will shift a perspective guest to a booked guest.

Back on the ground level, I encourage you to get a specific understanding of your personal audience. To do this, look at the insights and statistics of your profile on Instagram (there are third party platforms that can help you with this). I encourage you to always have your finger on the pulse of your audience, especially as it grows, because as they evolve, you want to move with them.

{ Before you miss it, go to your workbook and answer Q1.1 & Q1.2 }



01. Lesson: Pricing.

When it comes to pricing, the first thing you to remember (again) is that you’re emotionally selling not practically selling your property. For example: “Two bedroom unit with dishwasher, Netflix, and laundry. Close to shops and beach.” is a practical sell — it’s correct, accurate and what you’d get if you were to book that property. However, it isn’t overly appealing, nor does it stand out amongst a laundry list of potential properties. In contrast, an emotional sell of the same property may sound like: “Romantic beachside couples getaway with everything you need (and nothing you don’t) close-by. This cottage is wine by the fire and whale watching in winter; salty hair and sandy feet in summer.” I would say the practical property would rent for about $150 / night, whereas the emotional property could rent for $300 / night. Why? It comes down to story. You’re not charging what it’s worth, you’re charging what people will pay.

{ You made it to your first exercise! In your workbook, flip to E1.1 - Write a short description of your property as though you’re emotionally selling it and one as though you’re practically selling it. }


Setting your rate.

When you go to set your nightly rate, you may notice Airbnb recommends a much cheaper rate than you would like. They get this number based on the average nightly rate of other properties in your area and it’s recommended you start a little lower so you can book guests and begin to build your reputation as a host. This makes a lot of sense, but it is one that’s designed to benefit Airbnb, not you. They want to get as many users on their platform as possible, not as much money or as many bookings as possible for you. As a very tiny side note, I have found that with cheaper nightly rates, you’re likely to have more bad experiences with guests than good ones if you rate were higher.


Your pricing equation.

To set my pricing, the equation I use is: start 10% higher than the average for your area from Airdna’s data. You can obtain free basic data about your area with a free account, like nightly averages and occupancy. You will need to make a free account but it is worth it. Once your occupancy climbs higher than average occupancy, increase the price anywhere from $25-$50 / night until your number of bookings begins to drop.

{ Go to E1.2 to work out your nightly rate and when to increase it. }



01. Just so they’re all in one spot: Questions + Exercises.

Q1.1 - If you want to be booked out year round, at top dollar, who should be your audience?

Q1.2 - If your property is currently not targeting couples (for example, families and groups), how can you reinvent your place to focus on this market first?

E1.1 - Write a short description of your property if you’re practically selling it and one if you’re emotionally selling it.

E1.2 - Let’s work out your starting nightly rate. When are you going to increase it? What is the occupancy average for your area? How much will you increase it at a time?


01. Ponder this.

“To love what you do and feel like it matters, how could anything be more fun?”

- Katherine Graham.


 
 
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01. Your homework for this module.


 
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01. Q and A with Sarah Andrews.

 
 

Q. I don’t want to pay to make an Airdna account, It seems expensive!

No don’t pay! You just need the basic unpaid account to see your high level area data which is all you need. I also hate putting my details in but to get this info it really is worth it.


Q. Hi Sarah, quick question on pricing - the average for my area according to Air DNA is $196/night in the last month for a 2.5bed/6ppl whole house. Mine is a 1 bedroom/2 person studio off the side of our house - does the 10% extra on the average price rule apply if your accommodation is on the smallest end of the available accommodation in the area? Also, we have very seasonal accommodation pricing down here. How would you navigate this?

Great questions, let me tackle them one by one. Firstly remember pricing is emotional and not practical? This means it doesn’t matter how many bedrooms you have, the data just sort of shows what people on average are willing to pay for a visit to your area. Does that make sense? Don’t let how many bedrooms you have get in the way. 80% of people travelling through anywhere will be a couple… on average. Make your place amazing and back yourself. When people are selecting a place to stay they choose the place that makes them feel the most excited, not that has the most bedrooms or mod cons.

Secondly, seasonal. I get it — Maybe price seasonally based on your differing AirDnA data, and keep chipping up your prices per season. If your doing really well you’ll find you’ll keep chipping up your off season price once you find your sweet spot for on season. Work with them both differently and see how high you can climb!

Q. I get what you are saying about couples being your ideal market, but I have a big house, what do I do?

So, make it smaller. There is a few ways to do this, you can discretely lock off or close areas of the house, price for a couple and increase your nightly rate p/p. Another option is leave the house open and ask guests to ‘choose a bed, any additional slept in beds will incur a charge for 100 per bed per night’ (or whatever would be the equivalent for an extra couple per night).

That way, your pricing to get your couples in, who are your bread and butter, year round, great guest, and also have the flexibility for groups and families that come through. In short, design your price and house for couples, with the flexibility to ramp it up when the opportunity comes along.





 
 

 

Hey, have a question? Found a spelling error? Have a total breakthrough revelation and want to tell me about it? Use the form below to submit your questions and feedback.

Ideas or gaps in knowledge that benefit this classroom as a whole will be built into our classroom, so make sure you always review our chapters again before you head off into the wide world to spot any updates, or perhaps your question featured in our QnA.

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01. Community.

It’s time to start meeting your classmates! I encourage you to use and explore the hashtag #thehostingmasterclass and the tag @thehostingmasterclass on your images to see who is around. This helps us all find one another, connecting our work and life to those on this journey with you.

If you’d like to post anything specific to this chapter, you can index it with a second hashtag #thm01 — making it searchable two ways!