Length of Stay Pricing

What is Length of Stay (LoS) Pricing?

Length of stay (LoS) pricing is a pricing strategy that accounts for the number of nights reserved and usually decreases the nightly rate for each night added.

Why use LoS Pricing?

Duration Restrictions: If property managers restrict bookings to only allow for 30 day rentals or 14 day rentals, they fail to appear in search results on the marketplaces for guests looking to stay for dates under that specified time period. When a consumer searches VRBO for a vacation, they might be looking for any given number of nights lower than condo association’s minimum length of stay, but they still would be willing to pay a price for a full 14 nights (or close to it). On the other hand, property managers may be willing to discount a property if a consumer is willing to stay at a given property for a longer number of nights.

Turnovers: If a market operates on turnover days, LoS can be used to increase available bookable dates. If the guest is due to arrive on Saturday, they could be given a quote for $1000 a night for a 7-night stay, $1166 for a 6-night stay, $1400 for a 5-night stay, and so on. Typically, these units would only be able to book for turnovers of Saturday to Saturday, therefore, opening up more bookable inventory.

Competition: LoS could be used to increase the competitive pricing of a longer stay. The property manager may want to discount stays of 4 nights by 10% and 5 nights by 15%. They would even be able to exclude discounting based on duration over weekends. In addition, LoS could be used to increase the nightly rate on weekends only.

Understanding the Fundamentals of LoS

Before diving in to how the LoS Module works, there are a few fundamentals that are important to know. LoS is made up of layers that can be applied to a range of dates, and then assigned to a rate-set. Within the LoS layer, it can be applied to just the daily rate, floor rate, or both.

What is a layer?

A layer represents the LoS pricing that can be applied to an entire date-range or select dates/days of the week. For example, "1-3 Nights 10% Discount" could be a layer that is created. This can be created using a Booking Window that applies to a whole range of dates, or to LoS where specific dates can be selected.

What is a multiplier?

A multiplier is a number that represents a percentage to either increase or decrease the daily rate by. For instance, "10%" would increase the rate by 10% per night or  "-10%" would decrease the rate by 10% each night. The multiplier is set within the layer to manipulate the pricing.

What is a range?

A range represents the dates that the layer is applied to. For instance, the layer can be applied for the next 7 days ahead to reduce the rates by 10% for the specified dates.

Booking Window vs. LoS

To access the LoS Module, go to:

  1. Reservations & Quoting
  2. Quoting
  3. Length of Stay

First, it is important to understand the difference between the "Booking Window" and "LoS."

Booking Window:

With the booking window, it will always assume that the first day of the multiplier starts "today" and each day it will automatically shift the whole range over by one day. For instance, if a new multiplier were to be added today, August 1st, the range will always continue rolling for every day, so tomorrow the start date of the range will be August 2nd. This allows a larger date range to be manipulated at a time, rather than changing the pricing per date-band for future dates.

The booking window only applies to nightly rates and does not apply until the guest selects a range of dates.

LoS:

Unlike the booking window, where the first day of the multiplier is always today, LoS allows a date-range and future dates to be selected. For instance, pricing for three months out could be configured for an entire season. Perhaps, during Christmas season, a duration of 5 nights or 6 nights could be made equivalent to the price of a whole week. We call this type of yield management minimum pricing, and therefore, a LoS layer could be created for Christmas to mark-up the rates for durations of stay less than one week. This allows for a property to be returned in search results without losing revenue on Holiday week.

Essentially, there are 2 steps involved in adding LoS multipliers:

  1. Create a layer - the layer can be a window or per length (see above)
  2. Apply the layer to the rate-set and configure the duration of stay that the LoS layer applies to.

Multiple layers can be applied to a single rate-set, assuming they do not overlap. See example:

How to Add a Booking Window Layer

Specify "Booking Window" from the two options, and then to add a new multiplier to a booking window, click on "Add New."

First, enter a name for the layer for reference (ex, "Booking Window")

Specify if the select layer applies to daily rates and/or floor rate quotes.

The table displays the day of the week, date, and how many days ahead for each given date, starting from today:

Multiplication values can be set day-by-day, or by using a range to apply to larger sections of the multiplier range at a time.

To add the multiplier to a single day, simply click and type the multiplication factor (percentage to mark-up or mark-down the rate by) within the "Percent" column.

For example, to increase the price by 10%  for a date(s), simply type "10" into the field.

To decrease the price by 5% for a date(s), type "-5" into the field.

Be sure to click the "Save" icon to save any changes.

To edit a range of dates, click on "Edit Range" and specify the price based on the range ahead.

For example, for any bookings arriving 10 days from now until 20 days ahead, discount the rate by -10%.

Then, click "Apply."

Compare the multiplier to a rate-set:

To see how the configured booking window layer affects a rate-set, a rate-set can be chosen for comparison.

Please note, in comparing a rate-set, it does not associate the layer to the rate-set. It is simply to see how it will look, once assigned.

To compare the multiplier to a rate-set, click on the drop-down field under "Compare Rate" and select a rate-set from the list:

The table will load the rates for the chosen rate-set into the table to see how the pricing is affected based on the applied multiplier:

Once again, this does not apply the booking window layer to the selected rate-set. It is simply to compare how it will look once it has been assigned.

Be sure to click the "Save" button to successfully save the booking window layer.

How to add a new LoS Layer

Specify "LOS" from the two options, and then to add a new LoS layer, click on "Add New."

First, enter a name for the layer for reference (ex, "1-3 Nights 10%")

Specify if the select layer applies to daily rates and/or floor rate quotes.

The table displays the day of the week, date, and the multiplier (percentage) against each date:

Similar to configuring a multiplier for a booking window, the percentage can be set day-by-day, or by using the date range option.

To add the multiplier to a single day, simply click and type the multiplication factor (percentage to mark-up or mark-down the rate by) within the "Percent" column.

For example, to increase the price by 10%  for a date(s), simply type "10" into the field.

To decrease the price by 5% for a date(s), type "-5" into the field.

Be sure to click the "Save" icon to successfully save the multiplier.

Notice, there is no longer a "Days Ahead" column, the LoS only applies to set dates.

To edit a range, click the "Edit Range" button. This tool allows bulk updates to be made to the LoS layer.

The multiplier can be set to each specific day of the week within the selected date range, or it can be applied to all the days within the date range.

Specify the date range from the calendar date-pickers, and then select to set the multiplier per day, or for the entire range.

Set Per Day:

Specify the multiplier for each day. Keep in mind, to apply a discount, enter a negative (-) symbol before the amount.

In this example, every Friday and Saturday night between August 1st - August 31st, will be increased by 10%.

Set Entire Range:

Specify the multiplier for the entire selected date range. Keep in mind, to apply a discount, enter a negative (-) symbol before the amount.

In this example, every night between August 1st - August 31st, will be increased by 10%.

Be sure to click "Apply" to save the changes:

Back in the table, for the LoS Layer, the changes to the range will be shown:

Multiple date ranges can be applied to one layer, by repeating the steps above.

Just like with the booking window, a rate set can be selected for comparison.

To compare the multiplier to a rate-set, click on the drop-down field under "Compare Rate" and select a rate-set from the list:

The table will load the rates for the chosen rate-set into the table to see how the pricing is affected based on the applied multiplier:

Once again, this does not apply the LoS layer to the selected rate-set. It is simply to compare how it will look once it has been assigned.

Be sure to click the "Save" button to successfully save the LoS layer.

Assign a Booking Window or LoS Layer to a Rate-Set

Once a booking window or LoS layer has been configured, it can be assigned to one or more rate-sets.

To do so, click on the "Rates Associated" icon:

The table will show any rate-sets that have already been associated to the selected layer.

To associate a new rate-set, click on "Associate Rate Set"

  1. Select the rate-set from the drop-down
  2. Enter the minimum and maximum nights that the guest must book for, for the upcharge or discount to apply (For example, if a 10% discount has been applied, but the guest must book for at least 2 nights to receive the discount, enter 2 in the min. nights field. If the discount only applies for bookings 5 nights or less, enter 5 in the max. night field.) Keep in mind, setting a min. of 2 and a max. of 2 nights, means the duration of stay would only be 2.

One rate-set can have multiple LoS layers assigned based on the duration.

For instance, a 10% off LoS layer could be assigned for any bookings where the duration is from 2 nights to 10 nights. Then, a second 20% off LoS layer could be assigned for any bookings where the duration is from 11 to 21 nights.

A 2-night layer could charge 75% more for short stays, to yield a 3 night booking. Also, rules can be applied to yield a 3-night or 4-night stay to be roughly equivalent to a price of 5 nights. This way, the revenue of a home is not adversely affected by taking shorter stays.

This "Show Graph" shows the LoS layers and ranges that have already been configured for the selected rate-set and it will prevent configuration overlaps:

The rates can also be previewed using the "Show Grid" view:

Edit Rates:

Rates can quickly be viewed or updated from this screen by clicking the "View Rate Set" icon:

Un-associate a layer and rate-set:

To remove the layer from the rate-set, click the "Trash" icon. Please note, this does not remove the rate-set or the layer, but simply removes the association between the two.

How to Edit a Layer

To edit a layer, click the "Edit" icon from the first column in the table:

If the selected layer is already assigned to one or more rate-sets, a warning message will open:

To continue editing the layer, click "Yes." The editing window is very similar to creating a new layer. Follow the steps above, to make any adjustments to the layer.

How to Delete a Layer

To delete a layer, click the "Trash" icon from the first column in the table:

If the selected layer is already assigned to one or more rate-sets, a warning message will open: to confirm the deletion:

View LoS by Rate Set

To quickly see the LoS layers assigned to a given rate-set, click "View LoS by Rate Set" above the table:

Select the rate-set from the drop-down field. The table displays the layer, layer type, and the minimum and maximum nights.

From here, the layer can be edited using the "Edit" icon, or removed from the selected rate-set by clicking the "Trash" icon.

How to Export a Layer to another Rate-set

To save time, layers that have been applied to a rate-set can be exported to one ore more additional rate-sets that do not overlap an existing layer on the selected rate-set.

To do so, select the rate-set that has the applied layers, and then click "Export Layers."

Next, select one ore more rate-set and click "Export."

A pop-up will appear to show how many layers successfully exported or failed:

How to Generate a Quote with LoS

Now that the Booking Window and/or LoS layers have been created, quotes can be generated in the system and on the website using LoS.

To generate a quote, go to:

  1. Reservations & Quoting
  2. Quoting
  3. Get Quote

A quote can be generated as normal, by entering the dates and other applicable filters, and then clicking "Quote."

Please click here to read the documentation on how to generate a quote.

To include LoS in the quote, click "Include LoS" or "Show LoS breakdown."

Quotes can be generated with LoS multipliers but without showing the breakdown. This is ideal for sending a quote to the guest, as it will not show how each night has adjusted rates.

After applying the applicable quote filters,

  1. Click to include LoS
  2. Click "Quote"
  3. To see the pricing details of a property, click the "save" icon in the first column of the table

Alternatively, the breakdown of the LoS multiplier can be included in the quote. This is ideal for understanding how LoS affects the quoted value.

To include the breakdown, follow the steps above, but click "Show LoS breakdown?"

The same logic applies when a guest quotes on the website. However, it will not show the LoS breakdown to the guest, it will show the total price including the LoS multipliers.