5 Quick Fixes to Instantly Boost Your Airbnb Profit

What if I told you that by getting more bookings on Airbnb might be the thing that's actually killing your profit? Well, I'm Mark Simpson, and I've spent over the last 16 years in this business called short-term rentals, and I've helped hosts boost over $1 billion in bookings and stays combined. And in that time, I've seen so many fully booked hosts actually work harder and make less profit when they were less busy. But what most hosts don't know is that there are 5 secret fixes that they can use to make more money from the bookings they already have. So in this video, I'm gonna show you what these fixes are so you can quickly boost your Airbnb profit without having to take on more bookings. And the first one works like this. So back when I was running my family's business, we were making a huge mistake that killed our profits. I've spoken about this a little before on the channel, but if you are new around here, basically we had lots of regulars that would stay with us year after year after year. So because of this, we'd only raise our prices by a few pounds or a few dollars every year. Because we didn't want to upset those people who kept coming back to us. We thought we were just being loyal to the people that trusted us with the money to go on holiday. But the harsh reality is that what we were actually doing was leaving tens of thousands of pounds on the table every single year. Because a few years later, when we finally raised our prices, our bookings didn't. And the harsh truth is, if you are too scared to raise your prices, your hard work is never going to be compensated in the way that you actually deserve. But you might be asking this. Mark, how do you actually raise your prices without annoying your existing customers or getting your pricing completely wrong? Well, the easiest way to find this out is to use something that I call the PEAK rule. It's what we use back in the granary, and it works like this. Now, the P stands for pick a tool. Tools like PriceLabs tell you exactly how much you can charge without turning potential guests off. And it's actually the first place that I recommend hosts go when they want to check out how underpriced they really are. Next, The E stands for events. Basically, you want to make sure that every local event, holiday, and busy weekend is put in your calendar. Now, it may sound obvious, but most operators don't take full advantage of this, and you could literally be sitting on a gold mine when a concert or a massive event comes to your town. All right, so next is A, and the A in PEAK stands for adjusting your floor. All this means is that you want to decide the lowest price you'll ever accept for a booking and make sure it's the number that you're happy with. Never accept anything lower. And if this means being empty, I'll show you why this actually might be a good thing for your profit a bit later in this video. And finally is the K, and that stands for keep reviewing. Because unlike what you might hear, Airbnb is not a passive income business in the slightest, and the task of pricing your properties is no different. You can't just set and forget your prices. So the best thing to do is to review your prices every month or 6 weeks with all of the other listings in your area and repeat this cycle of peak again. Which brings us on the second way to actually increase your Airbnb profits. If you do one thing from this whole video, make it be this. Because if I was to ask you what your nightly cost is, I would expect that you could easily tell me what a guest pays. In fact, why not put it in the comments below now? But what if I asked you what a single booking costs you? And this is the one first question I ask clients inside of the Boostly community who come to me to help make more money in their short-term rental business. Because most operators don't just track the cleaning, the laundry, the extra coffee, the loo roll, general repairs, and all of the other costs that quietly drain their profit. But if these small leaks inside of your business that stops hosts working harder and let them keep more money per booking. So if you might be thinking, all right, Mark, but how do I plug these leaks without turning it into a penny-pinching nightmare? That no guest wants to stay with? Well, this is where we're going to use another system, and this is called LEAK. And yes, I do love an acronym, but bear with me, right? So the L stands for list every cost. So for one booking, just go ahead and actually write down exactly what it costs you from top to bottom. Things like cleaning, laundry, consumables, platform fees, the lot. Until you've done this once, you'll never actually know how much money each booking actually makes you. Now the E stands for extras. This just means that every extra gets a price. So if a guest wants to bring a pet or wants additional parking or early checkouts or check-ins, that's totally fine, and you can make some of these free by all means. But if any extra, like a check-in or checkout, is something that would cost you time or money, you have to start charging for things like this. At the end of the day, you're building a business. You're not being greedy. And then the A in LEAK stands for adding upsells. You would be amazed how many guests would be interested in tours or airport transfers by sending them a little message before they arrive. Remember, and I've said this a lot on this channel, if you don't ask, you don't get. Finally, the K stands for keeping everything per unit. This just means that you want to charge per item or night instead of just charging a flat fee or general extras. This way you'll not only keep more profit per booking, but you'll also find these little bounces actually give your guests a better experience. So it may sound strange, but when you think about it like this, charging more could actually get you better bookings and get you more bookings in the longer term. Which brings me nicely on to fix number 3. So let me show you why being fully booked might actually be a problem. Right now, what I'm about to say might upset a few of you watching, but stick with me because it is so important that you hear this. Being fully booked should never be your goal. I'll say that again because nearly every host gets this wrong. Being fully booked is never the goal. Your 95% occupancy rate might look good when you're bragging to other hosts at conferences, but the harsh truth is that you can't actually pay your mortgage with a percentage. Why? Well, imagine this scenario. There are two hosts in the same town in the exact same month. The first one is obsessed with being full, so she drops her nightly rate right down, and sure enough, she hits that 95% occupancy. But the second host holds his nerve. He keeps his price at where it should be, and he sits around 70%. So on paper, he may look like he's got all these empty nights, and to many people looking in, he could be doing worse.. But when you actually add it all up at the end of the month, the second host has made more money with fewer guests. That also means that they had less check-ins to deal with, less cleaners to manage, and less chances for something to break in the property. But how can a host earn more while doing less work? Well, an empty night costs you practically nothing, but a cheap night costs you the difference between what you charged and what you could have charged. Plus the cleaning, the wear and the tear, and the hassle of dealing with new guests. So when you think about it like this, empty isn't your enemy, being cheap is. And I know what you're thinking right now. Okay, Mark, so what do I actually do with this information? Cancel all the bookings? Well, not quite. Obviously, getting consistent bookings is important. Yes, but there is something else equally important, and it's a rule I want you to tattoo inside your brain. Price your properties for profit. Not just a full calendar. Work out what you actually keep per night once your costs are paid. Then set your prices for that number using the PEAK system that I showed you earlier, and be brave enough to let a few nights go empty if needed. I promise you that the hosts who are confident enough to have a few gaps in their calendar always earn more in the long run than the hosts that are chasing high occupancy rate. And that leads me perfectly into fix number 4. So now you've got your pricing sorted, I want to show you a profit fix that might feel completely backwards. Because if you want to make more profit, there's actually another reason you might want fewer bookings in your calendar. Not just for the price issue that I spoke about, but because of the hidden turnovers quietly draining your profits. Why? Well, if I was to ask you to list out everything that you had each time a guest checks out, what would you name? The cleaning, laundry, restocking, buying more loo roll, fixing damage on that hot tub from a random thunderstorm in the middle of summer. The point is, I could go on and on, but the problem is none of these hidden overheads show up on your nightly rate. But nevertheless, it's all still come straight out of your pocket. Which leads me to something that I really want for you to remember. A one-night booking is the most expensive booking you'll ever take. You pay the full cost for a changeover and all of those overheads I just mentioned. Just to earn a single night's money. But what can you actually do with this information? Well, it's pretty simple when you all boil it down. I highly recommend that you set your property up with minimum stay, even just 2 or 3 nights instead of 1. Then you can go and add things like weekly discount for stays of 7 nights or more, and a bigger one if they're going to go for a month or longer. You'd be amazed at how many people want to book your property for weeks at a time. And if you can give them an incentive, They're more likely to act. Which brings us on to fifth and the final fix. And honestly, this one is the big one because this is the one profit fix that makes every single thing I've shown you 10 times more powerful. And I know that may sound a little bit fluffy and a little bit internet marketing talk, but hear me out on this one. I will say this until I go to the grave, but the harsh truth is this. If almost all of your bookings are coming through Airbnb, you really do not have a business and Brian Chesky is your boss. That's exactly what happened to one of the hosts that I work with who's called Dana. She was quietly bleeding money to the OTAs like Airbnb for years, which is strange, right? Because she was the person that took all the risk. She brought the property, she fully furnished it, and she's the one who is up at midnight answering questions from guests who have locked themselves out of the property. So why then should you then have to hand over 15%? 20 or 25% of everything you make on the platform that can bury your listing tomorrow. And that's exactly why when I started working with Dana, we got her to build her own direct booking website to start getting bookings outside of that Airbnb platform. And after she did this, Dana saved over $3,000 in a single year. But here's the really cool bit. The cheapest booking any host ever gets is the guest that they already have. And once you've set up this direct booking system, you can finally own your guest data. This This means more if they love their stay. It's 10 times easier to contact them and bring back again without ever needing Airbnb or an online travel agent. Now at this point you may be thinking, okay Mark, where do I even start with this whole direct booking thing? Well, I want you to start to OWN YOUR PROPERTY. And yes, this is the final acronym. Never say I don't warn you. Now the O stands for owning your guest. I want for you to capture every guest's name and email and put this into a simple spreadsheet to start with. That list is the single most valuable thing in your business, and no platform can ever take it away from you. Next is the W, and that stands for your website. You want to give people somewhere to actually book direct. I'll show on screen a couple of examples of some of the simple, trusted direct booking sites our clients use. And if you would like for us at Boostly just to build one for you, there's a link in the description that you can tap to book a call with our team. Finally— Finally, The N stands for nurture. You wanna make sure you are nurturing your guests back into your ecosystem. We did this all the time back at our family business. It would shock you how many guests came back year after year because we sent them a nice little handwritten Christmas message or an early offer for the next season. But even after you've mastered these 5 fixes to increase your profit, you're still gonna need some bookings to test these out with. So watch this video next and I'll show you my simple system to maximize your profit and bookings. I'll see you in there.