5 Vacation Rental Discount Scenarios & How to Handle Them

Mike Stachowiak —  September 11, 2012

Haggle Free ZoneIt may be due to our recession economy, or the ever-growing array of online travel choices, or due to the growing interest in vacation rentals among travelers, but the fact is, travelers are increasingly likely to ask for a discount.

First, don’t feel pressure to concede! Ultimately it’s your decision whether you want to offer a discount or not. When you find yourself faced with a traveler looking to negotiate, here are some practical tips to help you out with some scenarios you’ve likely encountered already.

Scenario #1: The Bargain Hunter

An email inquiry checking dates available also comes along with a request for your “best available rates.” Everyone likes a bargain and travelers are only going to give you their business if they feel like they’re getting a good deal.

Solution: First, make sure you’ve done your homework and compared your rates to your competitors. If you aren’t ready to discount, point the guest to your published rates on your website and reiterate why your home is a great value. It’s helpful to have a canned response for these types of emails, but whenever possible, personalize it based on the information from the traveler.

Scenario #2: The Negotiator

You’ve just got your third inquiry for a prime weekend during your peak season and they’ve asked for a major discount. Some people are hagglers by inclination. While negotiation can feel like an unwelcome nuisance, travelers may not always expect to get exactly what they offer.

Solution: Often a compromise is expected and you can appease the negotiator with a small concession that minimally impacts your bottom line, but leaves them feeling satisfied. While you won’t be discounting your peak rates due to high occupancy, you can politely offer alternative dates that would better suit their budget during the shoulder season. If their dates are solid, let them know you’ll keep them on a waitlist should you receive any last-minute cancellations.

Scenario #3: The Balker

It’s off‐season, there’s been a last-minute cancellation and you are trying to find a renter on short notice. A traveler inquiry seems “in the bag” when they unexpectedly ask you for a discount as you’re about to close the deal.

Solution: If you’re concerned about risking the booking altogether, offer a straight discount if they confirm within 24 hours. Another option is to offer a free night – 4 nights for the price of 3. This way you’re not discounting an existing rate, but offering an incentive for a night that would have otherwise been unoccupied.

Scenario #4: The Weekender

You’ve got a 3-night minimum stay at your home, but a traveler only wants to rent it for the weekend. They can’t leave work early on Friday and have to get back by Monday. With the high cost of turning over your rental in 2 days, financially, it’s just not worth it.

Solution: If the traveler is asking for a weekend stay, quote them the price for the weekend (without the 3-night minimum requirement), equal to the cost of 3 nights. You can even tell them that it includes early check-in and a late check-out since you’ll be blocking off the property anyway.

Scenario #5: The Repeat Traveler

A wonderful couple stayed at your home last year for their anniversary. They notice the dates are open again, but ask for a discount as a repeat guest to your home. You don’t currently have a repeat traveler discount, but maybe it’s time to consider one?

Solution: If the discount request is reasonable, accept it! The easiest customer to get is an existing customer. And, consider coming up with a standard discount available for all repeat guests and letting them know about it. If you’ve already had a great experience with a renter, don’t go through the hassle of qualifying new travelers if you can secure future bookings with a small concession.

How To Say “No”

There are many valid reasons not to offer discounts or lower your pricing. Just remember that the best discount scenario is one that’s a win‐win for both yourself and your guest. While you may be seeking to increase your bookings and attract new customers, it’s also important to have confidence in your bottom line. It’s wise to be prudent when setting precedents that could pressure you to lower your prices to meet customer expectations down the road.

If you receive a discount request you do not wish to accommodate just remember to be courteous, offer an alternative scenario if possible (such as another week that might be less expensive) or consider explaining why your pricing reflects value as it stands. The more positive the impression you make, even when saying no, the more like that traveler will inquire again or refer you to a friend in the future.

Photo Credit: Hammonasset

Mike Stachowiak

Mike Stachowiak

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Co-founder at MyVR.com. Mike Stachowiak is an entrepreneur, technologist, and active member of the start-up community in Silicon Valley. He has a vacation home in North Lake Tahoe and has been active in the vacation rental industry since 2009. You can find him on Twitter and Google+.
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2 responses to 5 Vacation Rental Discount Scenarios & How to Handle Them

  1. I totally agree with you, I have been renting out my apartments in Paros Greece for some years and I have come across all the 5 cases you have stated. I must say that it is not always win-win case but depends also on the customers’ will to understand and accept the alternative offers. Otherwise I prefer to have the vacancy for a better customer!!!
    Liza

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