Rad Revenue and Data Management with Brad | Ep. 04

I'm Rachel Alde and this is the Hospitality Breakroom, a podcast full of nuggets and secret sauce where every Monday we'll shed light on what we've learned from the countless mistakes we've made along our journey in the chaotic and rewarding world of vacation rentals. Hi, I'm Rachel Alde and welcome back to the Hospitality Breakroom. We're sitting actually in the breakroom as we always are and I'm here with Brad who has worked with the boat for nine years. Brad started evenings and weekends operations, right? I think even just doing my regular prep inspections and everything. Yeah, inspection, how it started, right? He was here like as a ski bum in Park City, I think. Transitioning out of it. Transitioning out of a ski bum and he was like wanting more and then once he started working with us, my husband Rob and I were like oh, Brad's really smart and we knew that you know he could do a lot more and so over the years he's transitioned through a few different roles but really like revenue management type focus and so currently Brad is a director over our sales team and also our homeowner relations, right? Yes. But he has like tons of experience in revenue management and just like I feel like your brain I always tell this to Brad and this is so weird of me but like Brad's brain just like thinks of things differently than mine does and so he always has like commentary or ideas that are to me like really smart and something I would have never thought of and also like the way that Brad looks at data is always something that I would never I would have never thought and so look it at that way and so it's been really really helpful. So I feel like Brad's going to be full of nuggets and secrets us today because number one he's been in the business for a long time. He's been in a bunch of different areas of the business and he has this really cool like data analytical mind I think am I saying that right like am I saying that wrong? Do you agree with that? I was yeah for better or worse have seen a lot of streamline and data and all that so it just yeah the patterns repeat themselves over time. I would say you are a streamlined for sure a streamlined expert and key data. Yes. Okay so we're gonna go over just some points Brad and I kind of discussed in advance like what the kind of nuggets we were gonna talk about but then we're gonna let this be pretty free form so that he can share all the good stats. So I think we were gonna start by talking about the concept of the amenity filter and like how that works with our business and what your personal experiences and stuff you could share with other people. Sure yeah so I think there's like from the Hone owner if they're say wanting to do a moderate upgrade so 10 to 25 thousand dollars pouring into their property there's a lot of things as an owner is gonna sound really great and espresso maker nicer thread cap sheets maybe a higher end so for things like that those will all photograph great in the long run they might help with reviews. Yeah but when somebody's shopping for the property it's never going to show up unfortunately and so it's like like in our market there's still properties that don't have air conditioning so if people add many split air conditioning that is a huge revenue gain you'll probably gain it back in the first year and then there's still a few properties that have space for hot tubs they don't add them yet that's also like in a steam market it's like having a pool and so it's it's the easiest way to just drive your booking because I know we had a property this year where they were doing construction so the hot tub was removed from the listing for about a year and then we turned it on about six weeks ago and we've had like four bookings so that one and then on the lower end price point like if you just upgrade rooms that have queens or devils to kings that's like an easy one because most adults prefer the king. It's like my number one thing I always tell if a homeowner asks me what should we do to our house if their house was really nice I used to tell them like no you're fine you're gonna have to do anything but now if they have any queens I'm always like okay there should be no king like all kings and if anything else there's a bunk room and people fight us on this for sure but I totally agree with you Brad had like written up some possible like nuggets for us to share today and this amenity filter to me strikes such a chord because so often I'll talk to homeowners and they're talking about their sheet they'll be like they want to talk about the thread count sheets that they want to offer to the gas and they'll be kind of like leery of the and we do a linen program here at a boat and we do pretty high quality commercial linens but they're not like you know the reté or friend linens and so we'll have homeowners that really want to offer that to their gas which I think is cool but it's such a good point the way Brad put it which is and this is the nugget here like when you're looking to do upgrades or when you're talking with a homeowner to do some sort of upgrade to amenities or offerings within a property it's really good to think about is it one of those things you check a box for like when you're looking to book a property when you're going out of the RBO Airbnb or our website like a vacation rental company's website is it one of the things you enter along with your dates how many bedrooms how many bathrooms and then like is it a tip off and VRVS is pretty good about making like whatever's popular in the market like in a ski market the hot tub is gonna be the most recommended or air conditioning so totally there's things like your properties just not gonna show up don't have air conditioning in the summer I always tell homeowners that like because personally I despise hot tub there could be a whole episode about why I hate hot tub so much but I think if you've been in the vacation rental industry for very long and you're any market I can't think of a market that wouldn't be hot tub heavy but I would say probably go with a pool over hot tub and really warm market yeah anywhere else yeah but like I always tell homeowners like I hate hot tubs they're disgusting hot tubs here's a nugget hot tubs are people suit like think about it everyone like hot tubs are humans too they're disgusting they're just like water that doesn't get changed out you know not like during the day no fresh airs getting in there so it's closed off and people sit their bodies in it and stew in it and they like that and like if you ever look at a hot tub filter like anyway I hate hot tubs and I just was talking to a homeowner in Sun Valley and it was like a homeowner and there's like a family in their own multiple properties and they have really cool properties and it was great and we were talking about hot tubs because they were not into hot tubs personally as a family and I was like but you've got to get it because if you don't like the RBO and Airbnb will disappear you basically from listings because people are going to check that box and then if you don't have that amenity then no one's going to find you and so I think that's so important right so this nugget is like when you're talking with homeowners about upgrading linens the espresso machine the betting anything like that it is so important and maybe this is like we should teach like our team to do actually if they're not already doing it which is to be able to go online during a meeting with a prospective homeowner and show them the boxes that people check when they're booking on BRBO and Airbnb to be like see this is what people are checking so that's why we're focusing on these are the things that you would want to put your money towards to upgrade so it's like when you're making all these decisions and even if the homeowners preference is fancy sheets or a fancy coffee maker it's like look this is what the checkbox is already they don't already have a hot tub put the money there because that's going to bring you more revenue that is so like that's such a good point and it doesn't show up in the pictures either like how do you express fancy sheets yeah or a nice sound system it's like it's very hard but yeah if you're a hot tub in a picture it's well and I'm all about like that whole you know upleveling up leveling of the experience the unreasonable hospitality of like taking it above and beyond and I think fancy sheets are part of that but like when you're talking about a property that you want to create revenue with and if it's a homeowner who will be coming to you every year talking about like why is my revenue at this level how do I get it to the next level it's like then their spend does need to fall into the categories that the guest is making their selections based on and not just the above and beyond the above and beyond like linens or an espresso maker to me that's like after you already did the hot tub the grill all that kind of that's gonna like drive the repeat business yes you have to get the people through the door this first place yeah so and I thought this is kind of obvious but like I don't think I've discussed it this way before so like that's why to me this is like one of those nuggets that is just this is so Brad too it's just like a different way of looking at things that makes you like oh yeah like I kind of I kind of knew that but I didn't think about it that way and I wasn't making decisions based on those ideas because I wasn't thinking about it that way and now I could make decisions based on that you know which we could help our homeowners to do the same so and that's awesome okay what's another one I think another approach like we have just from like managing our calendars is like for Park City Jackson Hole and Sun Valley are a little different but Park City is just middle of December to the end of March you're gonna make three to four times your average nightly rate of the rest of the year yeah so we put as much energy and focus on that time frame and then summer still performs well fall and spring or you get a booking it's great but yeah you're not you're not going to like clear that much revenue and then a lot of times it can be a headache for the owners and for the guests if you're putting in a lot of traffic on its real low nightly rate yeah so we'll focus in that hundred and twenty-nine stretch in the ski season we'll try our focus is always to try to fill up that calendar as much as we can because it's like if you be like if you own the store and you can sell the jeans for four hundred dollars or you can wait and sell them for twenty-five dollars in the summer like you want to sell the every pair of jeans for four hundred dollars yeah every night you have available you you want to fill those because if you can fill it early you can build your calendar around your other reservations where if you're kind of waiting for you know that kind of crazy high rate you might get it once but then you're gonna have yeah a week go on sold in January where it's like it could have easily fetched a really good rating just because you were you know kind of tried to get too much I this to me was like when I was reading a note the Brad took on this topic when we were looking about like what we were gonna talk about this struck a chord because because we manage higher end homes and I think I think any company at whatever level of luxury or level of nightly rate that they're managing houses at, they're gonna have like some homes that are on the higher end of the homes that they manage. And usually that homeowner, the homeowner who has the house that's like nicer than the other houses, they're gonna have that idea most often, not always, but like most often, they have that idea that like well my house should be getting this huge amount, right, because it's so much better than all these other-- - Sometimes they'll like base it off with their paid for it in the real estate price, which isn't that tangible. - Yes, when a homeowner starts telling us like, oh well I paid this much for this house, or someone just offered me this much, it's like that is so cool and wonderful as the holder of that real estate and like your investment, like that's amazing and I like, you know, I wish that I was holding real estate that way too, but as it relates to vacation rentals, this doesn't hold that much water. And that's a hard thing to be able to explain to people, but I do think this concept, 'cause we've dealt with this a lot, and I have to imagine other people's other companies do too, or even just homeowners that are doing like STR and managing their own home, it's like, you know, well, okay, so in Park City, the example would be like, during Sundance, my neighbors told me that eight years ago, they got $15,000 a night during Sundance for their house. So I want mine to be $10,000 a night during Sundance, because that was a long time ago and I understand things changed, but I mean, come on. And so, you know, a homeowner will tell us that they really want to hold out for this really high nightly rate, and they're thinking that like, that's going to make up the difference. And then I think what you're saying is like, this is not always the right play, or usually, I mean, the bulk of the time, not the right play. - Yeah, type of thing, because then you're just going to have these larger chunks that are too late to the market, 'cause we're all at completely fly market. So a lot of times the price of the flights will again, start to get too high where you just scare off anyone to come fill in your gaps, 'cause it's $15,000 instead of $500 to get here from Atlanta or New York, you've lost that crowd, 'cause the family is $9,000, no thanks, we don't want to fly for that much. So you lose that market and then the other thing over, like compared, like we're we book, I think, I don't have it in front of me, but I think we're about 10% ahead of the market, like each year on what we sell for Steenights. So that's, we're roughly 12 extra nights. So even though the $1,000, that's $12,000, we're making per property extra just by filling in those gaps. - Yeah, filling in the gap. - Yeah, and then if you're locking it in four, six months in advance, then you have 150 day window to sell a gap instead of waiting for the last minute. - Yeah, so to me, like the nugget here is the way to describe this to a homeowner. When a homeowner is telling you, I am gonna set my basement price, right? I want the lowest price for this peak week to be this amount of money. And they're dead set that like it's worth it to set that basement. I think like I think what you're saying and tell me if I'm getting this right, is like it's better to be playing more to the actual market and what that threshold is. And you know, this can be a way to chalk a homeowner off that ledge of setting some arbitrary basement. - Yeah, it's sort of, yeah, be like, if you're selling a lot of things, you would rather sell all 100 of those things at 90 cents, 95 cents on the dollar than magically thinking you can get. - Yes. - All of it sold at exactly the price you want. And like Park City particularly, very crowded market. I don't know, 6,000 rentals or so. So it's like, there's always going to be other competitions. It's not, I think maybe if you're on a small island, maybe you could whittle it down and there's, you maybe are the last house available at Christmas and you can get that high rate. But. - Yeah. - So. - I mean, I think I hear people talking about this all the time. I listen to like so many podcasts that I probably drive my entire team insane because I listen to podcasts and then I send the links for those podcasts to my team like in different sporadic groups. Like, oh, you have to listen to this and you have to listen to this. And so one of the ones that I really like is the Steve Milo straight fire. - Okay. - Like he, I just feel like he tends to have like interesting points of view, which I mean, I love Brad because I feel like you always have like a different point of view. And while like I don't know Steve Milo and I don't have like, you know, I don't have like a front if I don't know him or anything, I feel like he does have interesting different points of view. And while I don't always agree with him, like they're interesting to me. And so I know on one of his recent episodes, he was talking about the concept of like getting the pricing right and like, you know, do you wait too long to bring down the price and all of that. And I feel like that relates to this too, right? Like, yes, yeah, because it's like if you're playing catch ups, it's been a lot of other companies in town are also going to be playing catch ups and then all of you are slashing prices within like, you know, 30 days left before peak time is just a, that's a much harder place to be than your six months out and you're 90 cents on the dollar to everybody else. Like, you're able to book those five and seven nights days and you're locking in a lot of nights. So yeah, so like, okay, I'm thinking of a couple homeowners that you and I both deal with. So like, just think of one of them. Like, what is the thing? Like, what's the wording you would say to them if they were like, okay, we're not getting the bookings that we wanted for this peak wing. And we're willing to talk about pricing now. So what would you say like when you get that chance to get them to come off of that arbitrary basement price that's not helping their whole right? I mean, I think you can like start if they're very resistant to like, like change, you can start around the edges and because we've had success growing like, length of stay so you can increase like your weekly and we've got stuff in streamlined or we can do discount started, like 12 things like that or you phase out some fees, things like that. So those can help kind of drive that type of booking and then a lot of times, most owners will like the longer term 'cause there's a perception that there's less, like wear and tear. - Yes, yes. - So that you can kind of start there and then a lot of holidays you explain to them. You know what most people like to come off, they like to have Christmas at home and then come on the 26th, there's seven. So let's try, we need to let's try to have the first week at a lower price point. - Yeah. - So kind of try to balance it out 'cause I think sometimes yeah, if they're very new, there's gonna be a lot of resistance. - Yeah, they have, well, 'cause I know like, we run into this a lot because our homeowners tend to, well, almost all of them are like high-network individuals because we're the homes we manage are like a million dollars, you know, a 50 million dollar value. And so these people that own these homes, they have made so much money in their life and they either, this is not, I'm generalizing. It's not the best thing to do. But like, you know, generally they have built a company and sold it or they work in investments or their attorneys. Like that's a bulk of, right? That's a lot of them. And so I feel like when someone has been really successful in their fields and they've made a lot of money, they now, not always, but like that tends, human nature tends to kind of guide you to think like, well, I know a lot about business. And so we do run into homeowners often that feel really strongly that they know how to price this better than us because they have made more money and they have been more successful. So they wanna help us help them to make more revenue. And so it could be really hard, I think, especially in the more luxury side of it. But I think on any level of vacation rental when you're dealing with homeowners that have second and third homes, like that's a person that's wealthy. And if the property is super unique, if they hand designed everything, I think condos can be easier for you to be a surrogate. Yeah, but these unique properties that people really put a lot of thought and effort into. And also the fact that they bought it with money because they have been successful, it's really hard to negotiate or to explain to them how this revenue management and pricing works because they have this sort of internal understanding for themselves that they know better. And I think that can make that whole discussion even harder. They might have made little pricing models in their head when they bought the house to be like, it's gonna hustle out at this time. Yeah, so they definitely will be like, okay, as long as we keep the price to this, this is like what they were thinking during the real estate purchase. And so then they get into the reality of it and not to mention the changing economy and changing market. And then yeah, flex-d markets are super seasonal. So it's hard for them to understand, June 1st can't charge much. Like people were begging people to come here for a second. Yeah, so I think that's really interesting. Okay, so hopefully there was a nugget there about making sure that you're not missing out on those peak weeks because you're holding on to a basement that's too high, which in our case a lot of times is because of a homeowner and setting an arbitrary basement. But I think that can happen. I hear like the discussion that I heard with Steve Milo was more like on a company level that he was talking about how companies can kind of drop the ball in terms of watching their pricing closely enough. I think for us, we're small enough. We watch our pricing, Brad watches it, but usually those issues come up with homeowner requests. Yeah, right? Yeah. Okay, so hopefully that's a helpful nugget. I feel like it is. Okay, what do you want to do next? I think only other thing on the calendar is the other thing and can help rest of your team if you're booking steps earlier because then it's like, if you're having to do intro calls, contracts, payments, if you can do all that like for us are busy seasons, December to March. Yeah. So if we can knock a lot of that stuff out in October and not have to do it in January, you're saving all that time. So then it's been actually focused on the guest and not worried about collecting the second payment and things like that. So that's something that we only got good at more recently. So that's helped. I think just so you're talking about like, like sort of optimizing or creating efficiencies for collecting payment. And just also getting people like instead of waiting till November, December to get people to book ski season. Okay, right. If you're booking them in June, July, August, we're slower in the office than we can get that attention so people forget to send their contracts. This, this, this, you know, if you have a couple thousand reservations a year, each reservation is going to probably require 30 minutes of kind of paperwork. Yeah. And so if you're offloading that to less busy time a year, it's freeing that up where you can just focus on the guests and get through that busy time a year. And I guess like that would have to do with in different markets and different companies, how they do business and what their booking window is. Yeah, because they're simple. I know like Hawaii and Florida is probably more year round. But yeah, or like, because I know projects and whole it tends to really like a pretty long booking window, especially for like summer, the really, yeah, summer stays that are more expensive. A lot of times it's like a year out or even months out. Park City. I mean, we do get a lot of repeat booking that happens like before the guest even leaves or right after, which is more of like a year out. So I do think our market allows us to try and do more of that work in our offseason to book reservations that are longer out. And I don't know like I'm not sure in the southeast if they have the opportunity to book a year out is often, but I would think there's some of the weeks in the future. Yeah. Yeah. Yeah. I know there's like your, your flagstaff, Sedona's, Fredericksburg, Texas, those are probably more weekend crowds that could be harder to do. Yeah. Yeah. But no, you're totally right. Like to push the marketing and like you said earlier, like making sure your prices are where they need to be and not, you know, some arbitrary high price rate that's not going to get booked, making sure you're optimizing that during your offseason. So you can get those reservations and get that work done that takes, the reservation takes confirm before you're busy because yeah, for sure. Like for us, like once it's December, January, and we're probably like looking at booking for the summer, maybe in Jackson, Holland, Sun Valley, it's like it's a little crazier because we're so busy in house. Yeah. Okay, that makes sense. Yeah. What else you got? Right? Let's see. And then we're probably kind of going against probably the grain a little bit. We're fairly strict on cancellation policy. Oh, yeah, this is a good one. So I think like we found it beneficial because you tend to find a better clientele because it's somebody's willing to just front that money six months in advance. Yeah. Obviously, it's not as much of financial strain. Yeah. The price is not as big of a deal like someone that like understands at the time of booking that there's no cancellation. Yeah. No, I agree. This is a like hot button for sure. Because so we explain our cancellation policy. So generally, if it's more than two months out, they're on the hook for 25% of the reservation value inside of 60 days, no refunds, full amount. Yeah. So when you book, you're going to you're going to definitely, if you're booking more than two months out with a boat, if you're booking to stay with a boat, luxury rentals in any of our markets, if you're booking more than two months out, which the majority of our bookings are, then right then you're losing 25% right? Like there's 25% that you can't get back. So it's not that it's non refundable. It's just that there's a 25% just that I'll be. Yeah. And then within 60 days of the arrival date, there's no refund, which is really strict. I think I think our policies on cancellation are probably on the very far end of the strict side of cancellation policies. But we have to be that way because our markets are mostly ski markets. So very weather dependent. And so we can't have people like canceling their stay because they don't think the snow is enough, which comes up. Like people still try to do that. Because I'm pretty sure like our team in Jackson, a lot of the hotels saw really high cancellation last year, his Jackson had a really slow start to winter. Yeah. So if like we would be in that boat, if we had a 30 day cancellation window. Yeah. So we like learned that in the very beginning. And when Rob and I started this and really it was Rob that like came up with these rules in the beginning and he was good. I think about making these strict cancellation policies. I don't think they were this strict in the very beginning, but you know, we learned pretty quickly. We had to be careful. And so what was the nugget that we're getting from this here? I think that you're you're locking in typically at better quality guests. Oh yeah. Yeah. You're able to do that so far in advance. And then the other end, it's saving a lot of headache. Yeah. Owners are asking about why the calendar open up for margin. Those types of things you avoid that. And then and then our sales agents can then focus on selling and not managing cancellations. Yeah. So it frees up a lot of time. Yeah. I mean, this is definitely like one of those things that I think in the vacation rental industry for a company owner. If you're in a market where there tends to be more flexible cancellation policies, like I would think like the southeast sort of this would be really scary. I think to like start to think about having stricter cancellation policies and how it could actually help your business because I think that there's kind of a consensus, especially coming from like Airbnb, who's like trying to, you know, always support the guest in their cancellations. It seems like it seems like if I was if I owned a company in the southeast, and you know, a lot of my competitors had more lenient cancellation policies. I think it would be like a scary thing to think about like, okay, we should make ours more, make ours more strict. But I feel like it's, there is a lot of strength there because like what Brad said is, you know, obviously, yes, some people won't book if you have a strict cancellation policy. But do you want that person to book because if they're only booking because they see that you have a lenient cancellation policy, then there's some percentage of risk that they're going to cancel and you're going to have to give them their money back, which is even on the high end. If you have a flexible cancellation policy, you could theoretically book big sky, Jackson, Park City, and then you're who has the best snow, cancel the other two reservations. Oh, for sure. People talk about that. So that can be like they can lock in those places. Yeah. That's that's you run the risk of that. Yeah. I mean, so I will say I think being on the high end, like the luxury high price point side of vacation rentals, we really are forced to have stricter cancellation policies because of what Brad just said. And because also like one reservation could be 50 grand, 100 grand, whatever. And so you really can't risk having that just pop right off your book. So I think you get really interchangeable properties like if there's one in two bedroom condos, holding it probably could be easier. I mean, that's why hotels have more flexible cancellation. But I do think it's something for companies that are maybe not necessarily in the high nightly rate area of the industry, or they're not, maybe they're somewhere where the nightly rates are, you know, just less or the trend is to have more lenient cancellation policies. It is something to think about and just maybe to do a little math and like kind of noodle on. And I think that's a nugget here that's like, you know, look at the risk versus the reward. Like yes, the reward is that if you have a lenient cancellation policy, potentially more people are going to book those reservations. But they also are going to maybe potentially cancel them more readily. And so where do you net out? Are you really better? Or not? And if you're building your rates around your reservations, if you start to get these blanks, then it's like, oh, we built the back end of Christmas to be cheaper because that person was going to check out on the first, but then that goes away. If that person can't. Yeah, because it booked and then it canceled and it had to rebook late. Yeah. Or yeah. And then if the economy tanks ever, then it's like all those people just pull out of those reservations. Yeah. And I think, you know, that in our industry, there's always that fear because obviously the economy is always changing and our industry is always changing. And travel is because of whatever, like illnesses or terrorism or whatever. And so I think any time that we can have more stability in the reservations that we are getting, it's like that as a company owner or someone working at one of these companies, like that is a lot of security that you could find that I think could just like help you feel better in your business every day. Because it is kind of a scary thing to think about, especially those of us that were here before COVID and the feeling that was there of like when everything stopped and you're like, oh, my God. And you know, from our standpoint, we did, we did pay out refunds, you know, here and there for people we weren't totally strict with COVID. But we were more strict than most. And so we were able to retain some revenue to get us through those lower months to when things bounce back. And so that's another thing to be said about a strict or cancellation policy. Because a lot of people got as we know, just like completely, you know, ruined with that. Okay. I wrote down on my notes, this motel six. I can't remember what it is. So this is a common with Jackson hole. So don't wait a little bit. But summertime, like the motel six and Jackson hole, which I think it's changed game. But super eight is also the same bill sometimes don't feel like $500 a night in the summer. So then somebody that's got the two or three bedroom cabin is like, why is it my place going for, you know, if I've got three bedrooms, it should be at least $1,500 a night. Yeah. And so I think there's, there's that misunderstanding where it's like, you can stay there for one night. Right. We don't let that happen. Yes. They don't have to pay a cleaning fee. Yeah. They might already be like almost sold out. So they're like, we really don't want to give up this room. But we probably needed as a backup. And said there's like, they're, they're playing a totally different game. And then those owners never come back. Like I look today and it's like the super eight Christmas week and Jackson is $80. And it's like, they're not then asking correct the rates to go down. You know, so it's, it's, it's a different, you know, kind of the orange thing. So the hotel comparison is like a constant. And I don't know if other companies like if anyone ever listens to or watches this episode and potentially no one will. I don't know. But if someone does. And if you have an inkling like you should write us a note. Like I don't, we don't have a website. Okay. Yeah. But we have linked in. So someone wrote us a note because I am totally wondering if other companies get this as much as we do because we get it like Brad said on the motel six side. So for instance, like he said, there's a homeowner. They look online. They like arbitrary. Just pick a day of our meeting. They go online that day and they look up the motel six and they look at how much a one bedroom like a room is. And then they do the math, right? Well, the motel six, like Brad said, well, it's 500 a night in my house has four bedrooms. So, you know, it should be two grand a night if we're going to even be in parity with motel six, right? Or on the other end of the spectrum, they'll say the four seasons. Yeah, the four seasons is what I don't know. It depends what time of year. But let's say the four seasons is three grand a night. It's three grand a night. And I have 10 bedrooms, right? So it's like, they want that math to work. And it's like, that doesn't work. And I think this is a great nugget about what Brad is saying here, which is to be able to remind the homeowner. And I feel like I've done this a little, but not as good as you to be able to say, like number one, hotel rates fluctuate wildly. I mean, ours do too. And if you're doing good revenue management, you are playing with your rates all the time, right? Whether you're using software or you're doing it manually, like Brad does. But yes, our rates fluctuate, but not like a hotel. Like in a hotel has all these other things in play where, like what Brad said, they might be putting their rates up high because they don't want any other The Rams to Bug. because they need extra rooms because they know they're gonna have some issues. So like they may be literally pricing. Sometimes when you go and look at hotels, the rates will be insanely high. Or in part city, they're building a lot of summer conferences. So from the hotel will be randomly sold out. And every other hotel in town is cheap, but then they'll hone in on the one across the other place. Yes. That's also one. So that like someone will go online and say like a homeowner would go online and say, I don't know, in Park City, hotel Park City or Siné-Arxin. Their rates are $2000 a night and they're completely sold out. So why is my rate $2000 a night? And I have five bedrooms for the same time period. And it's like, okay, first of all, those the corporation that bought that whole hotel out. Okay, 220 a night. Yeah, they probably are being a tiny reduced rate because they bought the whole thing. And the rate's showing high because maybe there's like two rooms left that like again, they don't want those to book because they're gonna need them as backup. And yes, you see it as sold out, but that just doesn't mean there's all this demand. That means there was one corporate entity that bought out all those rooms. And so there's like so many examples of this. And then I think I know like an armark. I think they're St. Regis is Mary out affiliated. So yeah, relatively easy hotel people have their Mary out points. They cash those in since like they're filling up on people that are even paying directly with cash. It's like, it's a totally different animal. Yeah, so like people homeowners will see occupancy at a hotel that they're using as a comparison point. And they'll say like, well, their occupancy is so high and their rates are so high. And it's like, okay, but you're looking like Brad said at potentially a certain percentage of those rent maybe 50% or 40 or whatever that were booked with Mary out. So it's like those people weren't actually spending the money on that. And that those I think those conversations, it really does help to give those kind of bullet points of information to the homeowner because when they're doing their research, they feel confident about the research they're doing. And I understand it because the numbers are there in black and white on the screen. It's like, here's the rate that's available. It's the same timeframe and they're sold out. So then when you compare that to your own house, it's seen simple. But you know, being in the industry, we have to be able to provide them the additional contacts of like, okay, yes, but let's take into consideration all these other factors. Because it's the same when like a homeowner will go online and say, I pulled a comp set of comparable properties and it looks like they're all way more expensive than my house. And so why is that? And they're not even available, right? And so then what's the backup on that? Because I know you know the scenario. And it typically, it's like, say they're looking at Christmas rates in it's November. What's left on the market is left on the market. This is a way to expect. Right. And then you look at it. If it's like a VRBO listing and it's got one review and a VRBO, the way they put their listings, you can tell chronologically when it was put on the market. So it could be a three or four year old listing with one review. So it's probably that they're just always overpriced. Yeah. And they're not booking. They're not booking. They're looking at all the people trying to sell for doubles. And they're saying, oh, it's not even available. It's already booked. And it's like, well, it might not be available because they just, they blocked the, the homeowner blocked the calendar. And so you know, like you go online. And again, because we're in the higher end of the industry, this is the way this happens for us. And I have to imagine it happens a little differently for stuff that's more like three to five hundred dollars a night. But this has happened for so many years. And I feel like it's only in the last like five years that we've gotten really good at talking to homeowners about this topic. And really being able to dive into the background info, which is like, yeah, if you go online and you look at a certain date range and you're looking at properties in a certain price point in your area, you may see that there are properties that are listed for a very high price point. And they may show as unavailable. But this does not mean that they're actually booking for that rate. That just means that potentially the homeowner is like some owners that are like, they either sit up the winter or they sit out the summer. So then we have some that are occasionally like the rates or double triple in the summer because they're like, we don't want to rent it in the summer. Yeah. But they'll keep it open to the strict. So you're you might be looking at that too. Yes. Yeah. So like Brad's talking about like a homeowner that says, I don't want to rent in the summer unless it's some certain arbitrary basement that they sent that they set that's too high. Right. So maybe there maybe their place should rent for two grand a night in the summer, but they're putting it at five because they don't think it's worth it at two grand, right? And so then another homeowner who's with another company could be going online and saying, look at this comp property, look at this comparable property, it's listed for five grand a night. And it's just like mine. And you know, it's like, but that's because we put that there to not, you know, because they only want to book at this arbitrary basement, which it does change then the homeowner's perception of like what is real in terms of comparable or appropriate rates. And it makes it really hard. And I don't know if there's like, is there any way around that like logically to be able to pull data to like sift that out, except for just the digging into it and finding out kind of, I mean, you can not, you can't like pen down a neighborhood, but like you data, that's, they're only showing stuff that's actually booked. So you could filter six bedroom with a hot tub with, you know, and you're not going to get exact, but you can be like, yeah, that's booking at a $1,800, and your $5,000 night is probably going to miss the marbles of that. That's the play is I think right to pull the key data info to be able to show the homeowner what actually booked and like what the rates are in the timeframes that actually booked. And then you could compare that against what they're seeing on BRBO, Airbnb, and they're considering as their comps that which may not be what actually booked. I think that could be the play, right? To compare that way, which I think we've done before. And then on the really high end, it's like you have to remind them it's like the person's booking a ski and ski out property. They like to do your valley, but they'll probably also ski in Wyoming or Colorado. So it's like, if there's 20 available in Colorado, it's like they're going to book that one at business. Yeah, yeah, because like, you know, that's another thing with our high end of the market means that people have more access to more flights. They're not like as price sensitive. So there's not like, whereas I think a drive to market, it's more like what is within the driving. You'll see that in leads where it's like we ended up booking VIXGAC. Yeah. We'll just reply back, you know, so they're not, they want to come here, but they're open other places. I mean, I think because we're on the higher end of the market and we have these high nightly rates, I do think sometimes when people hear me talking about what we do, they might be like, whatever that has nothing to do with me because that's like so far off from our price point. But it's like, yeah, we have these higher nightly rates, which is great, but it does also set us into this like negative territory, meaning that our potential guests have all this freedom to go wherever they want and to make these decisions like it doesn't matter. And so then, you know, it's harder for us to capture those people, unless we capture them at the right time with the right price point because if we don't, they're off, flitting off somewhere else and they don't have two thoughts about it. So I think that's really interesting. Okay. So the nugget is when you're talking to homeowners and they're talking about certain price points and they're comparing, let's say, to hotels. What's the nugget? I would say on the, on the low end hotels, yeah, where is that hotel priced when there's not demand? It's $60 a night, then it's like, they're pricing because it's like, they're basically sold out. And then on the high end, it's like, remind them, you know, of course, he's going to have room service. They're going to have an on-site restaurant. You know, there's things that we're not going to be able to offer in our like basket of our goods. And so that's, that's something those places are going to have. And then they'll also have flexible cancellation. Right. And one night stays two night stays and we're not going to do that. Yeah. I mean, to me, I think the part to focus on is that flexible cancellation. I do feel like from the very beginning when we started a boat and I think other companies think about this too because it has to do with that whole amenities arms race that everyone's talking about. But even from when we first started, we really wanted to be able to offer the guests and homeowners hotel like experience at the house. So we do a lot of like ski gear delivery, private chef service. We tried to think of like, what do you get in a hotel? You get a spa. So we can have like in-home massage. You get restaurants. We can bring a chef to the house. You get, you know, in a ski location, you probably have like a ski and ski out area at the hotel or at the very least like a ski locker area. So we tried to, you know, do the ski gear delivery. So we try to replicate what's in the hotel. But I think the thing that we will never replicate we don't want to is that flexible cancellation policy. And I think that's a great point with homeowners because you can be like, look, there's partly there's this rate that's a difference because the hotel knows they're going to book a bunch of people and they're going to get, excuse me, a bunch of cancellations. And, you know, we're not going to do that. And so there is something to be said about a hotel setting a higher nightly rate for that one room because they do have that flexible cancellation. I think also then that other point that you brought up to, which is like the rates that you're seeing online for hotels have nothing to do with what those rooms that are booked actually booked for because you don't know about what arrangements were made, what hotel points were used, all that stuff. And I think those are, those are good key points, right? Yeah. Okay. All right. Do we miss any of these? Do we cover everything on? Um, I mean, I think the only other one like just when you're like looking for like 30 or 30 or 30 or 30. Oh, that's a good word. Things like that is like a lot of like an industry. It's pretty much everything is either charged. I'm like, I'm per listing it. $10. $20. I'm not per listing or the other arrangement is a percentage of likely revenue. Yeah. Because we're like about to go to the RMA and talk to all these vendors, which we, so at a boat, we use streamline. We use breezeway. We're getting on board with, um, send squared key data key data. There's something out there. I can't remember. Okay. Those are our favorite ones. And so I don't remember. Do you know which ones of those are on a percentage? Can, um, streamline loosely is on like integrated like if you book the RBO Airbnb3 streamline it. I believe it's half. Yeah. And breezeway is breezeway. It's a lot. Breezeway is per listing. Okay. Yeah. So what we do look at, I mean, a lot of pricing software is percentage based. I mean, honestly, if Brad, you're not, are you going to the RMA International? Uh, he's going to dark. Okay. So if you go to a conference and you see Brad, you should talk to him about software. And then he's going to be like, you know, I'm going to talk to him about that. I'm going to talk to him about that. a little bit interesting to him. Then that means it's interesting to me. And so I feel like because of that, Brad knows like so much about all these different softwares that are out there. So he's going to kill me if everyone starts like everyone, the two people that are listening to podcast. But he's getting people asking him, but he is an expert. Okay, but this was a note that he made that I think is so I'm so glad we saved this for last. Thank you. Okay, so Brad was talking about how when you're working with a vendor or software or whatever and they're talking like how their fee is going to be 1% of your revenue. Like what that really means and this like it's like in my in my the back of my brain, like I know it, but it's having him explain it this way. The perfect example of the Brad brain. Okay, so go ahead. Okay, so rough like just for this say you're at a 70 30 split with your owners. Yeah. And so if your revenue is coming in and the pricing software is like, hey, we're only going to charge you 1% every time you revenue, no big deal. They're charging 1% on the entire basket of money. So you're only ever seeing 30 cents on every dollar come to your company. Oh, wait, yeah. So we do we do either a 70 30 split or a 65 35 depending on which market. So that's what he's talking about the 30% based on our 30% split. So yeah, so for that and for the money coming in, only 30 cents is ever going to go to about so on a thousand dollar reservation, $300. Yes. So the pricing company though, they're going to pay one they want you to pay 1% on the whole thing. So that thousand dollars. Yeah. Is you're paying 10 yeah, or let's say 10,000, you're paying $100 on that. So you're really out of your your cut, you're paying three and a third percent. Yeah, says it's that it's a whole thing. Yeah, so like this was such a good point because it really doesn't make sense because I will say being about to go to a conference when I meet people that have cool tools for us and they say it's 1%. I'm sort of like, okay, cool, that's no big deal. And even like, so JJ King and Riley, I don't know if everyone knows them, but they recently helped us build Concierge software because we really needed Concierge software and we love trip around and we tried trip around for everybody. It didn't really work out for us, but it was so close and JJ created something that worked and I was like, yeah, we'll give you a percent of our 1% of our Concierge revenue as like payment for building the software. And he would like sweet because we do a lot of Concierge revenue and this is so interesting and you know, it's the same kind of with Concierge revenue because we basically make a 30% revenue, which is a whole other episode for us to explain how we do that, but we basically get a 30% markup on Concierge services and it's so true. So 1% is really like paying him 3.33% because we're not getting 100% of that revenue, you know, a lot of it is going in that case to the vendor or the service provider, but like with someone who's looking at taking 1% of your rental revenue, it's so important to be able to see if you can make up for that. Yeah, yeah, which is a lot, especially if you're already doing like, you know, if you have really high numbers for your annual revenue and you're saying 1%, but it's really 3.5. And so I would have never, I would have never been able to like verbalize that or, but it makes perfect sense. So it's perfect timing. I mean, I feel like, I feel like this episode's probably going to come out like somewhat, I don't know, a week or two, maybe after the RMA International, but then before before Durham, right? Because Durham's in December. Yeah, right. Everything's okay. So it's perfect timing for people while they're like looking at software and making decisions. Remember, this is my favorite nugget of this entire episode. That is when someone's looking at 1%, they're looking at charging you 1% of your revenue for their services, software, whatever. Now this will depend on like what your split is. And I know in some markets, it's 20% and more. Which standards even more if you're giving more to the company? Yeah, so think about that, right? So then if you're paying 1%, you're actually paying even more, the smaller that your split is like this, however, like for us at 3.33, based on the 30% split, if your splits last than 30, you're paying really even more than we are, which is really something to consider. And like, why have I never heard someone break that down like that before? I don't know, but I think it's really cool. Yeah. See, this is my brand's achievement for real. So yeah, I think these are so good. Okay, so, okay, so we went through our nuggets here. We'll try and like recap a little, even though I feel like sometimes the stuff that Brad knows is like so far above my head that I'm literally like, "Wait, explain it to me again." But okay, so we talked about the amenity filter and talking with homeowners when they're making decisions about what kind of upgrades they want to do in their property, whether they're small or big upgrades, that it's really important to take into consideration and talk to your homeowner about taking into consideration what those filters are on the booking channels that are being made for amenities. Like, what are the things you're checking a box on as a potential guest and focusing the spend on those things because that's going to move the needle in terms of bookings. And then there was the, oh, the approach with talking to when you're talking to a homeowner and they're setting a basement on their price point that you know, you really want to, and making sure here that we wanted to be able to have the right ways to talk to the homeowner about what are the factors that go into that basement and how it affects their overall revenue. So basically how an inflated, nightly rate during a peak season, how that can really affect their revenue overall if they're going to wait too long and end up bringing that down later. And then, is that right? Yeah, and then just like not focusing just on those peak peak days because if you have 20 or 30 days, it's like, say, in our, you know, like above average revenue, like, season revenue. If you're making $1500 a night, that adds up really quickly. Yeah. And since like, people sometimes forget about like January and February, our ski markets is like a lot of times when you're making the money and it's like, yes, Christmas is great, but it's seven days. Yeah. So it's true. Yeah. And we talked about the concept of comparing to hotels and how to talk to homeowners about like, you know, when they're saying, oh, this really cheap hotel like comparing it or this really expensive hotel and how to, you know, explain to them the differences and why those nightly rates and availability might look the way they do online, but what that really translates into into reality, we talked about the strict cancellation policy and how like the security behind that and also being able to balance out, you know, getting guests that are going to be okay with a strict cancellation policy because that means you have more security in those bookings. Gris those people clearly are not going to try and cancel most of the time. And then my favorite one then the, you know, making sure when you're talking to potential companies that you're going to work with and they're going to charge you a fee, taking into account one one percent of that revenue that they're talking about means and considering what that means with your split. I think that's huge. Yeah. Okay. Thank you. Okay. This might be the juiciest, fosiest, most nuggety episode that we've done yet. No thanks. Thanks. Thanks for interviewing. Yeah. No, I feel like it's funny because I'm harassing everyone on our team to be on the podcast and record and most of them are like, no, thank you. And I'm like, no, please, it's going to be great. And so I feel like this is not Brad's favorite thing, but you did really good. So thank you. Thanks for sharing to play along with me. And all right. And everyone else, all of the millions of people that are listening to this podcast or one or none, whatever. Thanks for listening. And we'll have another good episode soon.