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Values of bookings taken in December 2016
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charles cawley



Joined: 21 Sep 2010
Posts: 1205
Location: Herefordshire, Shropshire, Borders

PostPosted: Tue Jan 03, 2017 9:31 am    Post subject: Values of bookings taken in December 2016 Reply with quote

All of 2016 was strong month by month for values of bookings taken with the exception of December.

It started well and, then, we have noticed a sharp reduction in the value of advance bookings for taken from the second week on. Advance bookings for 2017 are healthy, but this was a quite marked aberration. We've seen odd events like this several times before. What have you noticed?

Meanwhile, a well known five star BnB owner in Herefordshire received an e-mail from a wannabe internet gatekeeper suggesting they reduce their rates. Others have received a similar message. As I would expect she told them, in no uncertain terms, what she felt.

Her business is successful and the best quality. What is this booking business playing at? Fortunately, it does not impinge on our market that much so this strange behaviour cannot be the cause of the December booking pattern.

But it could be a warning of monopolistic attitudes and market disruption.
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russellt



Joined: 09 Dec 2014
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Location: Ivybridge, Devon, UK

PostPosted: Tue Jan 03, 2017 9:52 am    Post subject: Re: Values of bookings taken in December 2016 Reply with quote

charles cawley wrote:
wannabe internet gatekeeper


What's that?
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charles cawley



Joined: 21 Sep 2010
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Location: Herefordshire, Shropshire, Borders

PostPosted: Tue Jan 03, 2017 9:59 am    Post subject: Reply with quote

There are not many to choose from.
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COYS



Joined: 06 Jun 2015
Posts: 746
Location: Greek Islands

PostPosted: Tue Jan 03, 2017 10:35 am    Post subject: Reply with quote

Agreed Charles.
Monopolies in all their forms are good for nobody except themselves, least of all consumers.
I've long felt that it will only be a matter of time before pressure pricing is added to the agenda.
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charles cawley



Joined: 21 Sep 2010
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Location: Herefordshire, Shropshire, Borders

PostPosted: Tue Jan 03, 2017 11:30 am    Post subject: Reply with quote

I can't say we have not had discussions, from time to time, to convince one or two owners who have tried to push rates up too high. But we have never, and will never, send e-mails like this.

Rates are highly sensitive- rightly so.That sort of thing, at the very least, demands the respect of negotiation and discussion.

In our case, owners always have the final say on rates but I admit, in a couple of cases, events proved them right to push rates up and us wrong. In several other cases, we like to feel we helped avoid reduced net income.

Hospitality is a key aspect of the business. Although squeezing as much money out is our default to benefit us and owners.. for many, other aspects are also highly significant. It took a year or two for me to learn about that.
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COYS



Joined: 06 Jun 2015
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PostPosted: Tue Jan 03, 2017 1:24 pm    Post subject: Reply with quote

I think the broad range of styles, quality, location etc is always going to mean price bands are wide. We ourselves have neighbours whose rates are almost double our own & others nearby whose are almost half. All similar on the face of it but very different if you dig a little deeper.
Some will always try to squeeze out every penny & there is always an element of 'pace keeping'
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e-richard



Joined: 17 Oct 2004
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PostPosted: Tue Jan 03, 2017 3:48 pm    Post subject: Re: Values of bookings taken in December 2016 Reply with quote

charles cawley wrote:
We've seen odd events like this several times before. What have you noticed?

Over the past 2-3 years I have noticed very clear indications that past performance is absolutely no indicator of the future.

The marketplace is undergoing very rapid and disruptive changes, so I just roll with it.
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Nemo



Joined: 14 Aug 2008
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Location: Norfolk

PostPosted: Tue Jan 03, 2017 5:34 pm    Post subject: Reply with quote

Forward bookings for the last couple of months have been hugely down on the same timescale last year. Looking back two years however, I'm up on the booking front. No rhyme or reason, there really isn't. Just holding one's nerve is the key!
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COYS



Joined: 06 Jun 2015
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PostPosted: Tue Jan 03, 2017 5:38 pm    Post subject: Reply with quote

Nemo wrote:
Just holding one's nerve is the key!


In a nutshell.
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ianh100



Joined: 10 Jan 2013
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Location: Sherborne Dorset

PostPosted: Tue Jan 03, 2017 7:34 pm    Post subject: Reply with quote

Hi Charles, do you see any different trends by the property size or facilities? We have been running a 2 bed one bath for 5 years and have always had very few forward bookings at this time.

We added a larger 3 bed 2 bath property last spring and have many more forward bookings for that property. These are two halves of the same building so location and facilities are very similar.

Perhaps it is a simple supply demand situation as there are probably 3x the number of 2 bed vs larger properties in our location.
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Ben McNevis



Joined: 15 May 2006
Posts: 837
Location: Scotland (for) The Brave

PostPosted: Tue Jan 03, 2017 7:54 pm    Post subject: Reply with quote

ianh100 wrote:
Hi Charles, do you see any different trends by the property size or facilities?


I'm not Charles but I think I can answer this one: Yes, bigger properties book further in advance. Small properties take couples or families who might think about taking a holiday only a month in advance. Big properties get bookings for anniversaries, birthdays, friends gatherings etc. Most of these have fixed dates so it makes sense for the organiser to book long in advance. Even if the dates aren't fixed, it still takes a lot more organisation to get a bigger number of people together and this is reflected in the thinking ahead that you have observed.

That's my take on it anyway.
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ianh100



Joined: 10 Jan 2013
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Location: Sherborne Dorset

PostPosted: Tue Jan 03, 2017 8:00 pm    Post subject: Reply with quote

Thanks Ben, Perhaps I need to think about how I market them as one 5 bed, 3 bath, 2 kitchen property! Can I charge a premium if they book both at the same time? Wink
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Ben McNevis



Joined: 15 May 2006
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Location: Scotland (for) The Brave

PostPosted: Wed Jan 04, 2017 8:17 am    Post subject: Reply with quote

Quote:
Can I charge a premium if they book both at the same time?


I don't have experience of co-located properties. But my gut feel is that the higher the number of people, the lower the price expectation per person.
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charles cawley



Joined: 21 Sep 2010
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Location: Herefordshire, Shropshire, Borders

PostPosted: Wed Jan 04, 2017 9:06 am    Post subject: Reply with quote

Ian-

Demand tends to come in niches. In our area, we've noticed an over-supply of sleep 2 and sleep 4 holiday lets, partly because entry costs are lower. In most cases, sleep 2s need to be 'special' to do well.

Holiday Lets come in 3 forms: 'Special' (eg: in a castle); 'Standard' (usually converted residential with no special characteristics); and 'Formula' (converted or built specifically for holiday let business). All can be between 3 and 5 star.

For us, sleep 6 is a stronger niche rising to the strongest of sleep 10.

En-suites are a major plus. A sleep 8 with no en-suites is in a very weak competitive position compared to one with 1 or more. That said, an owner with us has one called 'The Old Stables' which has no en-suites but is very popular. Other factors can overcome the en-suite attraction (or lack of), but they need to be special.

Booking two lets together sometimes works but if charged at their book separate rates, as Ben noted, this can be uncompetitive. There's no doubt smaller holiday lets do benefit more from short notice bookings... again, as Ben noted.

Depending on the location and nature of the buildings... and your pocket, if you had the opportunity, it might be worth reconfiguring to create a Sleep 10 and a Sleep 2. More radical would be a sleep 10 with generous en-suite provision.

Sleep 10 en-suites in three or more rooms is a very strong niche. You may have a chance of charging the same as the two rates you now charge for separate ones and, certainly in our area you would see higher occupancy.

The idea of a premium you mention is most likely, sadly, a non-starter.

A note on niches: An increasing trend is for one time 'sleep two' guests joining with other couples to book larger lets. If a sleep 6 is booked by three couples, the sleep 6 niche sees 1 new booking and the sleep 2 market loses 3 bookings.

Larger lets are less weather dependent, face less competition from foreign holidays and are usually much more economic when seen in cost per person per night (cppn) terms.


Referring to that e-mail about lowering rates. It read:


---------------------------------------

Hi *****

Right now, 90% of listings in Herefordshire and mid Wales are getting more views on their listing details pages.

One reason may be that their base prices are a bit lower than yours

If you would like to get more clicks or taps and search results to ‘***** near ludlow’, try lowering your base price

(Button featuring the words): 'Lower your base price'

---------------------------------------

The owner replied:-


Let me think about this for a minute…. No.

---------------------------------------

An ensuing discussion indicated that low price was a feature of many who appeared to be doing better with that wannabe gatekeeper business.

If you mix high quality with low quality business on booking sites the low quality gains from the company of high quality and the high quality loses. Proximity reduces the trust in any quality offered. If a choice of only high quality is offered the chance of someone paying a premium rate and booking is far higher.

Wyndham Wordwide is a master of niche marketing where some internet bullies (not necessarily the anonymous one mentioned) seem to be trying to advertise rivals out of business. The plan appears to be able to manipulate supply price and charge monopoly agent fees, but they will not get away with it.

The internet has made brands radically more fragile and old style loyalty to brands over decades is disintegrating at the touch of a button (or two). Niche demand is a long established fact of life in holiday letting. The idea that all niches can be bundled into one brand creating long term success is primitive and bound to fail.

Only massive loss making, coupled with investors believing it's good business to wipe out rivals advertising them to extinction keeps them going. The idea of eliminating rivals by service and quality whilst making a profit seems to be less of a priority.
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COYS



Joined: 06 Jun 2015
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PostPosted: Wed Jan 04, 2017 9:31 am    Post subject: Reply with quote

Well made observations Charles.
It's long been my opinion that the holy grail for the 'bullies & gatekeepers' is control of pricing along with everything else.
I couldn't agree more that the one size fits all agenda is ill conceived within such a diverse marketplace.
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