Using pricing tools to optimize rates

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Guesty’s pricing tools help you maximize income, and make your listing stand out in the booking channel platform. In this article, we explore the various tools you can use, including from third parties, and how you can use them in conjunction. These tools can also be utilized to control when a listing can be booked.

Guesty’s accommodation fare is the basic component of a reservation’s total price.

By default, the accommodation fare is calculated based on the listing’s base price. When the price is adjusted by a pricing tool, it becomes a “nightly rate.” To avoid confusion, we'll refer to the nightly rate (or base price, if it wasn't adjusted) hereafter as the "price per night".

Adjustments cannot result in a price per night of less than 10 USD or the equivalent value in other currencies. For example, a discount won’t be applied, if it lowers the price per night below 10 USD.

The accommodation fare is the sum of the price per night for the dates of the reservation. Each night’s price is calculated independently, and different nights can have different rates. Adjustment tools affect the cost of each night individually, except for weekly or monthly discounts, which apply to the price of all nights together.

Tools in the same layer may override one another, while higher-level tools are applied in addition to (“on top of”) adjustments by lower-level tools.

Following adjustments by all layers, the most updated price per night will be added to the guest invoice (folio).

Other costs can be added and calculated based on ("on top of") the accommodation fare, including basic fees, additional fees, and taxes. Also, price reductions, such as coupons and promotions can be applied to the accommodation fare. Learn more about Applying multiple types of price reductions on top of the accommodation fare.

Non-accommodation fare components will be shown on separate line items in the guest’s invoice (folio), with some exceptions.

Note:

Beta users can include an additional fee in the accommodation fare.
Channel commission can be added to the reservation total payout or just to the accommodation fare, fees, and taxes

The accommodation fare calculation layers

Let’s explore how pricing tools affect the calculation of the accommodation fare. Click a bullet to visit the article dedicated to the mentioned tool.

1st layer	Default base price per night
2nd layer	Manual adjustments via the calendar Guesty PriceOptimizer Rate strategy (Pro users) Third-party tools Airbnb imported pricing (Airbnb users)
3rd layer	Rate plans (Pro users)
4th layer	Markups and markdowns
5th layer	Weekly or monthly discounts
"On top" of the accommodation fare	Promotions Coupons

First layer: Base price

A listing’s base price will be the price per night for a listing, if no other tools are used to adjust it. You can set a weekday base price and a separate base price for weekends.

The base price will be shown in the calendar if it isn't adjusted by a higher-level tool.

When importing a listing from Airbnb, the listing's base price is pulled to Guesty.

Second layer: Calendar rates

The tools described in this section affect the price per night in the calendar. If you're not using any of the second-layer tools, the calendar rates will use the listing's base price.

Manual adjustments via the calendar

You can use the calendar to manually adjust the price per night for specific dates without needing to change the default base price. The adjusted price will instantly be reflected in the calendar. Third-party tool adjustments to the price per night are considered manual adjustments via the calendar, as well. Thus, we recommend not to use them together, as they may override one another. Learn more below.

Also, when assigning a new listing to a rate strategy, you can override manual adjustments to the price per night. However, manual adjustments to the price per night will sync with Guesty PriceOptimizer and won't be overridden by it.

When making a manual adjustment to the price per night, you can decide whether to override an existing rate strategy rule (if applied). As long as the "Override rate strategy" checkbox is ticked, rate strategy rules won't alter the listing's price per night. To deactivate this override, You can uncheck the checkbox, or use an override of the manual adjustments by a rate strategy, discussed below.

For example: The base price is $60. The price per night for 23 May 2024 was adjusted by a rate strategy to $66. Later, the price was manually adjusted via the calendar to $68. The manual adjustment overrides the rate strategy adjustment, and the nightly rate is now $68.

Higher-level tools, including rate plans, markups, markdowns, and discounts can all work with manual adjustments. These tools will apply “on top” of the second-layer tools.

For example: A rate plan adjustment of +5% will apply to the manually adjusted price for 23 May 2024 (68$), changing it to $71.40.

Guesty PriceOptimizer

Guesty PriceOptimizer (GPO) is a data-driven, machine-learning tool that gives you recommendations for your listings' nightly rates based on different time period intervals. Our interactive software takes several details into account based on market trends to offer the best-suggested prices.

GPO overrides previous rate strategy adjustments when the data is updated every 24 hours. If using both tools, ensure you make any adjustments to the price per night directly via the GPO settings. Manual adjustments via the calendar and updates via third-party pricing tools will sync with GPO and won't get overridden by it.

Higher-level tools can be combined with GPO.

Rate strategy rules (Pro users)

Rate strategy rules can adjust the price per night, the minimum number of nights per stay, or the listing's availability restrictions. You can set one-time or recurring rules, and apply them to defined periods or for specific conditions, such as when there is upcoming availability, or for short stays. You can also set a minimum and maximum limit to avoid a rate strategy rule to alter the price per night below or above a specified limit.

After a rule is activated, the adjusted base price is reflected in the calendar. Access the “Pricing” tab in the relevant property page to check which rate strategy is assigned to the listing.

A listing can be assigned to one rate strategy at a time. To switch a listing’s rate strategy, unassign the listing from the former plan before assigning it to a new plan. However, multiple rules can be used for the same rate strategy. Learn below how they’ll behave in the case of overlap.

Multiple rate strategy rules are set to adjust a nightly rate

If the overlapping discounts are all the same type - percentage or fixed-price - they will be aggregated. For example, if an "increase by 15%" rule and a "decrease by 5%" rule apply on the same date, the price will increase by 10% (15% - 5%).
If the overlapping discounts are not of the same type, the percentage discount will be applied first and then the fixed-price discount will be added or subtracted from that amount.

Overriding previous adjustments by a rate strategy

When assigning a rate strategy to a listing, the rate strategy will by default apply only to dates on which the price per night was not adjusted manually via the calendar or by a third-party tool. However, you can choose to override any adjustments made to the base price, minimum nights, or both, when assigning a new listing to the rate strategy.

This includes adjustments made by the following tools:

Manual adjustment of the price per night
Manual adjustment of the minimum nights per stay
Guesty PriceOptimizer
Another rate strategy that was replaced by the current rate strategy
Third-party tools

For example: A listing’s base price is $60. The following rate strategy rule is applied: Between May 21, 2024 - May 25, 2024, increase the base price by 10%. If you choose to override previous manual adjustments made to the base price, the updated nightly rate for these dates will be adjusted to $66. Otherwise, the nightly rate will remain $60.

For an existing listing under a rate strategy, you can unassign and reassign the listing to the rate strategy. The override screen will then reappear.

Be aware that GPO will override any rate strategy adjustments to a listing every 24 hours.

Higher-level tools can be combined with rate strategy rules.

Third-party pricing tools

You can use third-party tools to adjust the pricing of a listing, and their adjustments will be reflected in the calendar. Third-party changes to the price per night are considered manual adjustments via the calendar. Thus, avoid using third-party pricing tools alongside manual adjustments, as they can override one another. GPO will not override the action of third-party tools, as it syncs manual adjustments to the calendar. If you're using a third-party tool with rate strategy, note that third-party adjustments are considered as manual adjustments via the calendar. Learn more in this section.

If you disconnect with a third-party pricing tool partner, the nightly rates will not automatically change to the default base price. Instead, You can manually adjust the nightly rate to the desired values.

Third layer: Rate plans (Pro users)

A rate plan is a combination of a listing’s cancellation policy with other optional components, including meal plans, pricing rules, minimum or maximum night rules, and availability restrictions. Cancellation policies can be set as part of a rate plan, or be used as standalone. When a cancellation policy is standalone, you cannot add availability restrictions to it. Learn more about the differences between a rate plan and a cancellation policy.

Whether a cancellation policy is part of a rate plan or a standalone, it is required to make a listing sellable and bookable in a booking channel. If you have a rate plan with specified availability restrictions, the plan will only become available for booking under these terms.

Reservations that are not eligible for any rate plans (not meeting the rate plans' restrictions) cannot be booked. Also, a rate plan will only be visible to the guest if the entire reservation's dates are within the availability period of the rate plan.

If you set a single rate plan, it will be activated by default when its availability restrictions are met (if set), for the specific channel it applies to. When applying multiple rate plans, and their availability restrictions are met, the guest can choose the one they want. In the case of a manual reservation, select which rate plan to apply during the reservation creation.

The activated rate plan will be applied to the specific reservation, and the price per night will be adjusted according to the rate plan's restrictions you determined for that reservation (alone).

For example: You can create one rate plan for all Booking.com listings without restrictions and another with a 5% price increase per night, both without a specified date range. If a guest selects the former rate plan, the price per night and minimum nights will be according to the calendar rates and minimum nights. However, if they choose the latter rate plan, the price per night for that reservation will be adjusted by multiplying the calendar rate by 1.05 (X*1.05). The calendar rates and minimum nights remain unchanged, as different reservations can be booked with different rate plans.

Rate plans can be used with any higher or lower tools. If the price per night was adjusted by a second-layer tool, it will serve as the basis for the rate plan’s “on top” calculation. Any adjustments made by a rate plan (or any other higher-level tools), aren’t reflected in the calendar and will be integrated into the specific reservation’s accommodation fare.

For example: A listing’s base price is $60. A rate strategy rule is applied for certain dates, increasing the price per night by +10%. Additionally, we set a rate plan of a +$20 increase with no date range limitation. The rate strategy will be calculated first, and then the rate plan will be applied. The price per night will be $86.

= $60 + 10% + $20

Learn how rate plans interact with promotions for Booking.com reservations.

Fourth layer: Markups and markdowns

You can use markups and markdowns to compensate for a booking channel commission fee.

Guesty automatically rounds up the price following a markup/markdown adjustment. For example, if the calculated accommodation fare is $79.20 after a markup is applied, it will be rounded to $80.

Note:

Weekly or monthly discounts are calculated based on the rounded price.

Fifth layer: Weekly and monthly discounts

Weekly and monthly discounts are set per listing and are synced with Airbnb, Vrbo, direct integration sources, and manual reservations. The discount is the last adjustment layer of the accommodation fare. The accommodation fare won’t be rounded following a discount.

Discounts are embedded in the accommodation fare. In contrast, coupons and promotions will apply on top of the accommodation fare, and when creating a manual reservation, you can decide not to apply them. In most cases, an applied promotion or coupon will be displayed on a separate line item in the guest folio (invoice). Learn how multiple types of price reductions (promotions, and coupons) interact with one another per channel.

For example: We created a manual reservation, with a coupon and a promotion included. We applied a promotion named “Long booking” offering a 10% discount, and also a coupon named “Fredtest 12 months”, offering a 12% discount. Both have been added on separate lines in the reservation creation widget. Once you create the reservation, the promotion and coupon will appear in separate lines in the guest invoice.

"On top" price reductions (Pro users)

Promotions and coupons can be applied on top of the accommodation fare. Learn here how they interact with one another, with weekly and monthly discounts, and rate plans.

Example: How multiple tools work in conjunction to calculate the accommodation fare

Use the following example to check the hierarchy between different pricing tools when used in conjunction.

A listing’s base price is $100.A rate strategy adjusts the base price by -$5 for the following dates: 26-31 MAY 2024. A rate plan is set to decrease the nightly rate by -$17 (no date limit). Also, a markup of 5% is set. Lastly, a weekly discount is applied, giving a 9% discount per stay

The accommodation fare for different dates will be calculated as mentioned.

01/06-08/06