Live Let Thrive Podcast
Airbnb, PadSplit, Corporate Rentals, Arbitrage, and Live Let Thrive cover all the creative ways to rent out your properties to maximize profits. We also cover creative ways to buy properties. Come along for the ride and have some fun along the way!
Live Let Thrive Podcast
How To Use Pricelabs Effectively w/ Anurag Verma
Use Left/Right to seek, Home/End to jump to start or end. Hold shift to jump forward or backward.
Before he co-founded PriceLabs, Anurag Verma spent six years at United Airlines building revenue management algorithms. In 2014 he brought that thinking, and a background in math and statistics, into short-term rentals. Myka and Steve get him to explain how to actually use the tool.
The part most hosts miss is that pricing is not just the nightly rate. Anurag walks through the minimum-stay rules that do the real work: setting a 30-night minimum in the days right after an existing booking, then requiring 60 nights from someone who would otherwise strand a 20 to 30 night gap on your calendar. If a guest is going to burn 25 nights of your availability, they had better be booking a long stay.
He also takes on Airbnb Smart Pricing head-on, explains what separates a real dynamic pricing tool from a toggle, and makes the case that automation only pays off when you can customize it once and stop checking it every day.
And the OTA math worth writing down: price each channel so your net is roughly the same after Airbnb takes its cut, and mark up direct bookings a little too, because advertising is not free either.
IN THIS EPISODE
1:10 - Anurag’s background: six years of revenue management at United Airlines
2:48 - How dynamic pricing has changed, and why data quality is the difference
10:10 - Discounts, gap nights, and not wasting availability
13:03 - Airbnb Smart Pricing: what it actually does to your listing
20:08 - What separates a good pricing tool from a bad one, and why automation needs customization
32:00 - Pricing across Airbnb, Vrbo and direct so your net comes out the same
Holler at Steve and Myka! www.liveletthrive.com
Work with us. Interested in professional management or consulting?
Myka — Sharebnb: www.sharebnb.com
Steve — Argest Rentals: www.ArgestRentals.com
Sign up for PadSplit with Steve's link and get a free 1-on-1 PadSplit strategy call with Stevie Stacks: padsplit.com/hosts
Myka's other podcast, Entrepremarriage — building wealth without losing the marriage: youtube.com/@Entrepremarriage
All our links: linktr.ee/liveletthrive
#airbnb #airbnbhost #shorttermrentals #midtermrentals #padsplit #rentbytheroom #coliving #corporatehousing #BRRRR #realestate #realestateinvesting #VRBO #shareeconomy #airbnbsuperhost #airbnbpodcast #sharebnb #liveletthrive #liveletthrivepodcast #biggerpockets #directbookings #bookdirect #dfwrealestate
Welcome to Live Let Thrive, a podcast about the Airbnb life, the share economy, and everything in between. Here are your hosts, Micah and Steve.
SPEAKER_01Hello, hello, hello, and welcome back to another exciting episode of Live Let Thrive. What is up, Micah Man? I am good, Stevie Stacks on this uh not so rainy Friday. How are you doing?
SPEAKER_02Oh, I'm doing great, man. Excited to get started on this wonderful podcast. We've got a wonderful guest. And it's funny because I was talking to a host back and forth, you know, trying to put some guests at their place, you know, an Airbnb host. And they they they manage their own little unit. They're like, Oh my god, I gotta you gotta respond back to me, and I gotta respond because I'm gonna get hit by Airbnb, and they're gonna because the algorithm, I mean, they're they're paranoid, dude. They're paranoid about Airbnb and tagging them and punishing them, and this and that. Like, oh man, I I forgot how scared people, you know, early on, how scared people are, but people are still scared of Airbnb. But we're not scared of Airbnb, right? Right, Micah?
SPEAKER_01Not at all. That's why the stock's now six percent. Let's go.
SPEAKER_02This is episode 248 of your favorite Airbnb VRBO, short-term, mid-term, long-term rental podcast in the world coming at you from Arlington and Fort Worth, Texas. And we have a special guest, Micah. Who we got today, Stevie Sticks? Anurag Verma. Who's that? You know who that is. That's Price Labs co-founder. And I'll read a little thing about Anurag real quick. He is one of the co-founders at Price Labs. Before Price Labs, Anurag was with United Airlines for six years, designing and improving revenue management algorithms and systems. In 2014, he brought his experience to of revenue management automation of short um I've missed automation prevalent in airlines and hotels into the vacation and short-term rental industry with a background in mathematics and statistics. Honorag as is also a PhD in operations research. Welcome back to the show, honorag. How you doing?
SPEAKER_03Good, Steven.
SPEAKER_04Thank you so much. I did not realize quite what the mouthful that introduction was. I will cut that down uh next time.
SPEAKER_02Well, see, the thing is, we were talking about oh, I don't he didn't recognize me because you know I've aged, I've had a couple little kids, and I uh cut my hair and my beard, and I got a lot of white and gray going on. Plus, now I I guess apparently I can't read my phone anymore. So I was I was struggled a little bit on that one, man. I need to make the letters uh, you know, make it a grandpa phone, make the letters real big. But uh we're excited to have you back. It's been about what four or five years since since Underrag has come on, like 2019. It was 2019, I think.
SPEAKER_03I think it was 2019, yeah.
SPEAKER_02So it's been a while. The landscape has changed quite a bit since then. And I guess let's uh we'll jump into how has how has dynamic pricing changed?
SPEAKER_06Yeah. All right. Oh, that's a question.
SPEAKER_02Yeah, yeah, sorry.
SPEAKER_04Cool. Uh no, so four years back, uh, a lot of the basic principles were the same of like uh what revenue management is, how is it done? Uh I I feel what has changed, at least for us, is the kind of data quality we have now. Uh, and and a lot of that, like over time, as as our team has grown, like we just now like scan, store, process way more data than we used to back then. I think back in 2019, it it was six of us uh in in at Price Labs. Uh now there are about 106 of us. So uh it it kind of uh helps to have more hands on the deck to do all kinds of things that like we just there was just no way we could do back then, right? Um yeah. So like with that, uh like for example, back then we had we were scraping a ton of data from uh Airbnb, right? To figure out what's happening in different markets. Uh now we do it from multiple OTAs. Now back then we would just figure out what's the occupancy rate. Now we also figure out what kind of length of stays are happening, not just how many people are booking for a particular period, but also like uh what kind of like are they working two night stays, three night stays, four night stays? Like we give minimum stay recommendations, for example, based on on what's happening in your market, right? Uh, if you're a midterm renter, uh we actually scan that as well to say, hey, look, uh this like we can provide data about what locations are good for midterm rentals versus not good for midterm rentals and and all those kinds of things. So uh a lot more capabilities to like uh we were strictly in short-term rentals back then, uh vacation rentals. I think now it's uh we serve midterm rentals, we serve hotels, we serve uh a lot different kinds of inventory. There are a lot more levers people can pull depending on what kind of inventory they have, whether it's um if even within midterm rentals, right? There are two kinds, like where your city requires 30 nights, where you have no other option, and ones where people do it by choice, right? Where you say, I want midterm, but maybe when it's last minute, I'm I will open it up for shorter stays, or when there's a gap between two uh bookings, I'll I'll open it up. Um, so depending on which one you are, your your revenue management strategy can be very different. Uh, and so like you've built out a lot of these tools to to enable uh whatever you want to do in some ways, right?
SPEAKER_02Yeah, man, that's that's a lot. Um that's a chew on another mouthful. Another mouthful, yeah. So here's the thing because because what what's interesting, the most interesting, you came from doing this for airlines, right? And that's and that's quite, I mean, I'm not saying that's simple, but people people get on an airplane to go from point A to point B. That's pretty much the gist of it. Whereas short-term rentals, you dove into short-term rentals game. Now there's so many different variables, right? It's apartments, there's two bedrooms, there's three bedrooms, there's houses, there's mansions, there's houseboats, there's uh tents, there's I mean, they got everything, every possibility, plus midterm, short-term, long-term. I mean, so I it it's like it seems like way more complicated to do it for the short-term, midterm rental industry than to do it just for the airline industry.
SPEAKER_04I think it depends uh what uh the problems that you choose uh in in some ways. Like airlines have their own complexities because uh like the same flight from Chicago to Dallas, for example, could be sold for somebody who's trying to fly from Chicago to Dallas, but it could also be sold for to somebody who's flying from London to Chicago to Dallas. And so like the complexity there comes from like uh do you sell it for 300 bucks to this guy, uh, the person from Chicago to Dallas, or you sell it for 1500 bucks to the London to Chicago Dallas person um who's taking up two seats, one in each plane. Uh so like there is complexity there as well. Uh it's a different kind of complexity here. I think what makes it truly like different, like if you think airlines is one, hotels is probably the closest sort of uh um, I don't know, closest comparison. But hotels have this huge benefit of like having 50, 100, 200 rooms. So when there is something big coming up, they you sell a few rooms for cheap quickly. And then it's you figure out that hey, something must be happening, you you bump up the rates for the rest of the rooms, right? Uh vacation rentals, you have one. Uh, and if you sell that out, you're done, right? Like you're done. You can't, yeah. There's nothing else. Uh most people have one, right? Um even if you have more than one, they could be in different locations. So like maybe it's something that was impacting something, something in Arlington Heights is not going to impact Fort Worth as much, uh, potentially, right? So there are all kinds of these uh unique traits that come up. Like the inventory type you mentioned is like the the craziest one. Like, forget about inventory types. People have two bedroom homes, and they could be in the same building, and they could be completely different. Like everything else, everything measurable could be the same. And yet the view could be like one could be looking at a parking lot and one could be looking into something much better. Or uh even you have seen this, even the same home or the same exact view, everything is the same. But depending on who's managing it, the description is different, the pictures are different, the reviews might be different, and then you're like uh like yeah, like how do you wrap your head around all of this? Uh it's it's tough. But then what helps is that uh most of our customers, uh like we provide a lot of data, a lot of automation, but it's not like we expect our customers to do nothing. Uh our customers also know their home, their inventory, their style, right? So they bring in their own smartness and then use price labs. Uh, and then that like we we say it in our onboarding, like the best benefit comes when you marry what you know to to what we know, essentially. Uh so that that's where like each inventory type, whether it's a tent or not, all of that, you know this really well. Um, we can provide you data about it, but then you know so much about your location and your home, you combine what you know with what we know and automate stuff, and that's where we think the magic happens. Nice.
SPEAKER_02Micah, you're muted. You're muted.
SPEAKER_01Yeah, I have one question I had for you was um I know you guys, you guys have really added in a lot of features. And one of those features I noticed you guys had done was adjacent pricing, right? I know a lot of people, they probably don't really understand that. Can you explain what an adjacent pricing is and how people can use that to their advantage?
SPEAKER_04Yeah, so there is adjacent pricing and there's adjacent minimum stay. I want to talk about both of them together in some ways, right? Um, so think of uh I gave this example of a midterm rental where the city requires you to do 30 night stays, right? And suppose you got a 30-night stay that's ending on April 30th, right? Now, what you don't want to happen is for somebody to book a 30-night stay starting May 25th. Because if they do that, you have these 25 nights in between. If you were doing midterm rentals out of choice, you would be like, let me take short terms in those 25 nights. But if the city requires 30, then then those 25 nights are wasted at this point, right? Uh what you could do, for example, is uh with adjacent pricing, what we do is we say, okay, look at the we look at the bookings you have. And if you if you turn this on, we will say, let's give uh let's say a discount of 50% for five nights that are adjacent or 10 nights that are adjacent to an existing booking. Uh now, anybody who's going to book a stay using those 10 nights uh is not leaving a gap, thankfully. And for doing that, they get an incentive, which is a cheaper price. Uh, whereas people who are booking uh leaving a 25 night gap instead have to pay sort of the full price. So you are going to lose a little bit. Uh the answer is uh if you get this booking, but at least you're not wasting a lot of nights in the process. And and you can set it up so that with the discount, the price still comes out to be something that you're happy with. And if they leave a gap, then then they pay more. Uh, even better is the adjacent minimum stay stuff. Uh, I feel you can what you can do is you can say, hey, I want a 30-night minimum, but you can set up these rules that say, if I already have a booking, after the booking ends, for the next 10 days, my minimum stay can be 30 nights. I'm okay with that. But if somebody is going to book from day 10 to day 20 onwards, checking in day 10 to 20 onwards, then I want at least a 60 night stay. If they are going to waste 10 nights, they better book a longer stay. Uh, or if they are going to leave a 20 to 30 night gap, make it a like even longer stay, or even 60 is fine to say, okay, if you are going to waste 25 nights on on this home, you better be booking a long, long, uh, long stay here. So you can do these uh sort of clever tricks in some ways. You have you have to set this up so um yeah, you're not essentially wasting a resource that you have, uh, which is nights on your home.
SPEAKER_02Love it. That's that's really cool. And one thing, one thing I want to touch on though, is that um so so Airbnb has their own smart pricing, right? And and when this whole um they called it the Airbnb bust or Airbnb Bust, whatever they called it back in uh November, December, when everybody's calendars were empty, um, we were thinking, oh crap, you know, we need to start doing whatever we can to get back in the good graces of Airbnb and try to get our places booked. And one of the things was we switched to smart pricing just to see maybe that'll help give us a bump in the algorithm, help us put us on the front page. Do you think that? I mean, along with other things that Airbnb wants you to do, do you think they they encourage and then they reward people for using their smart pricing? And do they punish people for trying to use an outside uh dynamic pricing tool?
SPEAKER_04This one is hard to answer. Like, I don't know exactly what they do, but I have a few points, uh like a few anecdotal points to help on this. One is if you're using us directly with Airbnb, uh uh, then you can keep smart pricing on. Uh, and actually, even if you have smart pricing on, you can't go on the calendar and say, for these dates, I know what my price I want, right? It's I don't know what exactly it's called in Airbnb, but that's how we update our prices as well. You can keep the smart pricing switch on, and yet we will continue updating prices. Um the difference comes when you're using a property management system, because then because it's uh full API connection, you actually can't access the calendar on Airbnb anymore. And I think you have to turn off uh smart pricing. There, I feel like Airbnb gets a lot of their revenue and bookings from professional managers. Uh, it would be strange if Airbnb said, hey, you're using a channel manager or a property management system. Sorry, you're going to rank low because you're not using smart pricing. So those kinds of things make me feel like that would be a poor incentive if it was there. Uh and we we all know plenty of very successful property management companies who are using uh a lot of the uh systems out there. So like it it seems like people are fine without uh getting whatever boost you can get from smart pricing, uh, if if that helps. Thank you. Do you guys use uh property management system?
SPEAKER_06Yeah, yeah.
SPEAKER_04All right, good. Yeah. So in that case, like uh how did were you able to like turn on smart pricing even though you were using a channel manager?
SPEAKER_02Yeah, I know I know what you're talking about because you could go in there and turn it off at certain stretches and put dynamic pricing in. Yeah, you could kind of do both at the same time, and we figured that out. But like uh when that bus was happening, we were trying everything, just trying to totally turn off you know the dynamic pricing just to try. Yeah, just to try. We tried to do uh, of course, turn everything to instant book, you know, did all the stuff they wanted us to do, took off cleaning fees. We did crazy stuff, man. And then and one of the crazy things was turning off dynamic pricing. But yeah, we got bookings, but it was not good, man. It was it was just like cheap bookings and it wasn't consistent. There's smart pricing, uh so many bugs to it, man. I mean, I mean, it's it's real buggy. I mean, it was it was crazy, but so we we we we went back. I mean, right now it's going great again. Uh luckily, you get tons of bookings, and and we got uh dynamic pricing back on, so it's yeah, it's looking good, looking better.
SPEAKER_01Yeah, that's why it was called the Airbnb bus and not the short-term rental bus. Yeah, they do make you turn it off. Uh, if you are using because I use hostfully and then I use my hostfully to connect to price labs. Um, yeah, yeah. So you said the adjacent factor one, I love that. Um, I think that's really good, especially for the midterm rentals. Can you go into because I know you guys are you have you guys already? Because I keep up with all your updates. Have you guys already released that hotel data tab, or is that coming?
SPEAKER_04Yeah, it it's already out uh for everyone.
SPEAKER_01Okay, and can you explain how that that can help hosts?
SPEAKER_04Yeah, so the thought there is um we we have always shown comparative uh short-term rental data on on like next to the calendar if you want to see what are other people charging, how are other people booked? Like, so for example, you can go and see for July, uh, for every date in July, what kind of occupancy is coming up right now. Um what we have heard from a lot of our urban customers is that they they they are an accommodation provider, uh, being on Airbnb essentially, right? So in some way or the other, they are, uh, especially if they are a smaller home, they are competing with hotels as well. So they want to see and keep tabs on what are some of the comparative hotels doing. This is the urban side of things. And then there is the destination rentals where there are resorts where there are vacation homes uh within the resort. And then the resort also has their own inventory that they directly sell. Like, so it helps our customers to have everything in one place to see, like, okay, I can rate shop and compare my prices against not just my competitors in short-term rentals, but also what is the resort selling at? Because a lot of times when when somebody goes, like say Orlando to or or somewhere else, Miami, you're you're essentially trying to find, like, unless you have a constraint where you have like kids and stuff and you want a kitchen, you're kind of shopping around. You're like, what's the best I can get? Uh so that's a thought to say, regardless of what kind of inventory is available, people should be able to find uh everything that they compete against in in one place.
SPEAKER_06Does that yeah, gotcha?
SPEAKER_04Yeah. Yeah. Sorry, go ahead.
SPEAKER_02Good. No, go continue on that.
SPEAKER_04I I briefly spoke about this neighborhood data thing where we show short-term rental data and like you know, you can see for July what's coming up. Uh I don't know if if you guys noticed we added uh two small check boxes. So you can overlay last year's data there. Um, especially when you're going through this period where like you're not getting bookings and you're like, is my market slow? Uh you can go to go there, you can say, okay, July 15th is 20% booked this year. Um what was it booked last year? And last year it was probably 60, 70, 80% booked eventually. But we also show you like as of April 14th, uh, or or whatever today is when you're listening to this, uh, how is that future date booked? Uh, how was it last year and how was it this year? And and that helps because when you say, okay, this year it's 20%, but at this time last year it was 25%, you're like, okay, we are actually being slow compared to last year.
SPEAKER_02Oh, I love that so much. And and I always and I always thought that like like back in the day when I was more hands-on in the in the pricing and the ops side, you know, now I'm more you know, acquisitions and doing other things. But um, when I was doing that, I was like, man, what did what the hell? Did this book pretty good last year? You know, I forgot what did I price it at? You know, I forgot. I I just forgot uh all that stuff. And I was like, man, I want to know, I'd like to know uh a better, you know, a better price and and what to expect, you know. And then so that that that freaking that's helpful, man. I dig that. Yeah. Um, I was gonna ask you also, so what makes um are y'all the best smart uh ad are y'all the best dynamic pricing tool out there? And what makes y'all the best in your eyes?
SPEAKER_04All right, in my eyes, you're definitely like the best out there. Uh right. Uh uh sort of a biased answer, but uh truly something that that we believe in and and want to continue building on, right? Um what makes us one of the best is uh a bunch of multiple things. Like so for customers who are more on the one, two, three property range, or like who are doing it uh as a single person thing, there's there's plenty to do uh and plenty of automation where you just don't have like large companies tend to have revenue managers who are looking at things daily, day in and day out. We we provide a lot of automation that uh so one is automation, right? Like that automation comes through customizations in a lot of ways. Like it's not just prices, it's all these things that you can do with minimum state settings, all these things you can do with adjacent day settings. And like you can think about a strategy and then execute it and automate it, and then be like, okay, I don't need to keep coming. To this in some ways, right? The second one is just the intelligence part. Like I talked about one is dynamic pricing, which of course is the most important thing. But then there's the whole minimum stay settings. Like when should you increase it? When should you decrease it? Uh, a lot of times we we get customers today who come to us and say, Look, I have I mostly get uh seven plus night settings. I keep my minimum stay at seven nights. I and and we show them this data. And I think at least right now, we are the only ones who show the data and show minimum stay recommendations as well. To say, in your location, like more than half the bookings are three and four nights. Like by having your minimum stay at seven nights, you're actually losing out on plenty. Um, so those kinds of things, like just providing intelligence around what should you set your minimum stay to be, what should your set your prices to be, and then giving this layer of customizations to automate strategies that you can't uh otherwise manually do. That's that's on the segment where you have a few properties, you're doing it all by yourself. And then there's this segment of larger companies where they have 100, 200, like I think our largest customer has about 1800 properties. Now, when you have that, it becomes very hard if you were going to do everything uh at for every single property. Like it's it's unmanageable, right? Uh so there, I think again, we are the only ones who provide uh I don't know if you guys use it, but uh group settings uh where you can create a bunch of rules and assign it to like you can say, okay, all my Chicago two bedrooms in a particular neighborhood. I don't need to set them up one by one by one. I can just create a group and put them all in this, uh, all the Chicago listings, two bedrooms in this group. And that's it. My setup is actually done. They can all be unique properties, they can all have unique base prices and attributes. And when you want to fine-tune something, you can still do it at the property level. But the broader strategies, you can control it at a Chicago level. So you're not uh if you have to change Thanksgiving minimum state to four nights for all of Chicago, it's one calendar where you do it and you're done. Uh, instead of you know going into a hundred calendars and and doing it one by one by one uh manually.
SPEAKER_02Nice, nice.
SPEAKER_04So yeah, bunch of things that uh I like.
SPEAKER_02Wow. Now that's that's um here's the dumb question on that. If you're throwing a hundred properties in one group, you still gotta pay for each each of the 100 properties separately, right?
SPEAKER_04Uh yes, you do. Uh, but if you have one property, our cost is like 20 bucks per property. If you have a hundred of them, it's six and a half bucks per property. So like it goes down pretty steeply.
SPEAKER_02Okay, uh that's pretty good. Do you have any questions? Micah, I got a bunch more.
SPEAKER_01Oh, go ahead, go ahead. Some right now.
SPEAKER_02Well, see, here's one, here's one. And I don't know this is a huge question. It's hard to ask pricing questions because there's so much that goes into it, right? So many variables. So I'm always torn. Uh in the past, even Micah's, you know, giving me advice. I'm like, dude, it's coming up, you know, my calendar is empty. The next, you know, there's a week, you know, next week it's empty, and there's something coming to town or whatever. I I think I should lower prices, man. I should lower prices. And I remember he told me before, no, no, you're probably one of the last man standing, so you need to raise prices. So, so when a situation like that happens, is it best to lower or raise prices?
SPEAKER_04That is a tough question. Um, the answer the answer is actually very easy if you happen to own all the remaining properties, as if you were literally the last man standing, right? So think of it this way. Uh suppose there are 100 homes in your area, right? And just assume that all 100 homes are very similar, uh, right. And somehow magically, suppose you knew that in a week's time when that event happens, uh, you're expecting uh about 10 homes to book, like 10 more people want to come, 10 more 10 people have want to come to this event and haven't booked a place yet. Let's say we magically somehow knew this, right? Uh it this itself is very hard to to know. Now if everything else is equal, you have a one in two in chance of of getting booked, right? Um if it so happened that uh you knew that 19 out of those 20 homes are going to get booked, you actually now have a 95% chance of getting booked. Like you can you can make the price in some ways to say, look, the it's all about how much supply is remaining and how much demand is remaining. If you were in a hotel and happen to be the only hotel in the area, then even if you had 20 rooms open, you could say, doesn't matter which 10 get booked, I can I'll raise prices for all of them. Uh that that's sort of a monopoly, right? Where you're able to do this. In short-term rentals, it's not a monopoly. It's the 20 remaining homes have all 20 different owners, they all want at least something. So you get into this competition, especially if it's going to be 50% booked, uh, the remaining inventory. If if the event is big enough, if you have enough uh data about look, this is not uh 90 homes out of 100 are going to get booked, it's 99 homes out of 100 are going to be booked, then you can try to be the last man standing. Um, otherwise, we generally say if enough inventory is still going to be left unbooked, uh try to compete on price a little bit.
SPEAKER_02On that note, real quick, what the hell happened in Arizona for the Super Bowl?
SPEAKER_04Yeah, I have heard competing stories. Um one story goes that, and and this happens, I think, every time something really big happens. Uh, and there are people who basically come onto the platform and say, Oh, Super Bowl is coming. I have uh, I don't know, like a 10 or whatever. Let me put it on Airbnb and see if somebody works. So it seems like potentially the inventory could have increased, uh, which led to the overall occupancy reducing. A lot of people potentially might, and and this is true for sporting events, till you don't know which teams are getting in, uh you essentially don't know what kind of demand is going to be there, right? And a lot of people don't really book till they know that the team is going to be in there. So one of the thoughts was uh that potentially a lot of people block their calendars just for that event, saying once it gets decided, I will then uh start uh I will then start doing uh like open it up and start taking a book. Uh but that sort of looks like occupancy. And and so it's also possible that a lot of people thought, hey, look, things are going great, like everything is getting booked. Uh, and and everybody either raised their prices, added more inventory, uh, whatever they could lay their hands on. And all of that led to like, okay, when eventually all the calendars opened up, uh, there wasn't enough uh demand out there. Uh I don't know if the teens themselves had anything to do with it, uh, but yeah, seems like not enough demand, way too much supply.
SPEAKER_01See, and I had multiple feelings on that as well, because I felt like I think a lot of the OTAs are just saturated, and I think most of the people who do that did that, they just sat on the OTAs, they could have picked up the phone and called people because they knew people were coming to town, and instead they sat on the OTAs. Um, but one question I did have for you was yeah, with you having because you guys are now you guys are partnered with PMPs, you got you partnered with guests, all these people. Um, with you having more data, and because one of the reasons why I've never liked uh air DNA, because I was like, it's just it's only grabbing from the OTAs, you're not directly connected. You there's certain data you just don't have. So with you guys having access to the PMPs, are you guys able to grab that direct booking data and then take that data and then kind of see, okay, this is how much these direct booking guys are getting. This is how much the Airbnb guys are getting. Have you guys been able to get data?
SPEAKER_04We get that only, and we get that, and also show each customer can see their own data. Uh so it's not like just because we are connected to guest V that we get all of Guestie's data. Only if you're using Price Labs and have uh have connected your guest V account to Price Lab account, do we get that data? But we do get that data. So, like uh for about 250,000 properties, we get that data and are able to actually do the kind of things you're saying to say, okay, um, so when we do blocks, like it's sometimes hard to figure out uh if you're only getting OTA scrape data to say what is a block, what is a booking, right? Uh but uh we can uh use all of the data that we are getting that uh the direct booking data to be able to say, okay, this looks like actually there is a lot of demand on on these dates. Things are getting booked.
SPEAKER_01Awesome. So in the future, do you guys think you would be able to put out like a report of hey, this is all the data we're getting from and like kind of put it as a feature like hey, if you want to book on Airbnb, this is what your price should be. If you want to book direct, this is what your price should be. Do you guys think you would ever have that something like that in the future?
SPEAKER_04That is tougher to answer. I generally uh I've I've tried running the math on this a little bit. Uh I there is very little benefit to so let me rephrase. I think that the price that you should be on selling on different OTAs should be set up so that eventually what you get is about the same, right? So Airbnb is charging 15%. Um, and so mark up your prices accordingly so that when you get a booking, Airbnb takes its thing. What you get is about the same as what you get for a direct booking, right? Although direct booking also has a cost uh associated with it, like if you're advertising and stuff, so like you might want to mark up the direct booking as well a little bit. But the reason I say this is because now the counter-argument is that hey, on verbo, uh it's mostly families who come, they are more willing to pay, so why not pump up prices further for it, right? And the counter I would say to that is uh suppose you have your price set to 200 on verbo, knowing that people are willing to pay a lot more on verbo, and you have 100 on Airbnb, because Airbnb is such cheap. I'm making this up. I I don't call it Airbnb on this. Uh but and then you say, okay, uh now as a host, you would be like, I got every time somebody books via Airbnb, you're going to be unhappy because that could have been a verbogest paying double the amount. And and I'm again making this double amount up. It it could be 15% more, 30% more, but whatever more it is, I could have made more. So the answer is, at least the way I think of it, is mark it if if you're marking it up, um you now have a reason to say, okay, I if I want that, I want that $200 booking, but maybe $200 is too expensive now. So I will bring it down to say, you know what, I'm happy to take a verbo booking that comes at $189, and I don't want this $100 booking. So then you say, okay, let me bump up the $100 because I don't really want this $100 booking. And then you keep doing that, and effectively you get an answer to that says, I'll price myself at $140, where I will I will still fill up my place and I will have a healthy mix of Verbo and Airbnb, and I'm making more money rather than selling one at 100 and one at 200 and just hoping and crossing my fingers that somebody from Burbo books instead of somebody from Airbnb would think. If that makes sense. When I sell it on wine.com, I don't know if it exists, but people there are kind of stayers, they are going to pay for it. So like let me bump up the price here. You could you could try those kinds of things when you have multiple. Like if somebody buys on Amazon, that doesn't mean you have nothing left to sell to the wine.com guy, right? Whereas on Airbnb versus Verbo, it is the same night. Like once it's sold on Airbnb, it's gone. Like you can't sell it for 200 on Vervo. Right? Yeah. Uh well, I I I've I have an Excel sheet I I made five years back to try out these combinations to say, like, okay, uh, what should happen mathematically? And more or less turned out that okay, um if if if you're in that position, then might as well bump up the rates to the point where you still expect to book wealth. Uh doesn't really matter to you where the booking comes from as long as you get the same amount of money.
SPEAKER_01Uh yeah. And and that's and this is kind of like a little bit advanced pricing that a lot of people don't think about. And I'm happy you broke that all the way down. You eventually do want to get to where, okay, you're making the same money. Because yeah, a lot of people, a lot of times, because I'm priced a little higher on verbo, but I know that verbo person's gonna pay more, and I'm kind of like when Airbnb comes, you're like, ah, this guy is gonna pay with the verbo. So I definitely understand that. Yeah, using those analytics to get to where you want to be. I love that.
SPEAKER_04So I think what you should do is bump up your verbo, uh, sorry, bump up your Airbnb price a little bit and verbo price a little bit down, and I think you'll be at the happy place. You'll you'll still fill up effort as much and and make more and not be unhappy when the Airbnb person works.
SPEAKER_02Now now, how does how does this affect goal stated? Because people like me, I think a lot of savvy um you know uh uh travelers, they'll they'll go to they'll go to uh an Airbnb that they like, like, oh, this is really nice. Uh and they see a little logo up in the corner. Oh, who's who's um South Padre Island Rentals? Uh let me go check them out. Go to their site, I call them, and they say, okay, we can do it for $300 less than the Airbnb thing because the fees, this and that. I said, All right, I'm gonna book straight through you guys' website, and then they're gonna go block off those days. So, how does that affect your um information that you're gathering?
SPEAKER_04The best part is they don't have to go block off the dates once somebody books. Hopefully, the channel manager is going to block off the dates, right?
SPEAKER_02Hopefully, hopefully. Yeah, I'm I'm not sure if this this for yeah, okay, maybe in a perfect scenario, yes.
SPEAKER_04Yeah, yeah. Uh, and most of the times, uh channel managers are fairly reliable now, so they they do end up uh blocking the dates off. So the way at least we look at market data is you look at every like when we look at a random Airbnb listing out there, Airbnb isn't telling us that these dates are booked or if they are blocked, right? Uh all we are getting to know is that those dates are unavailable in some ways. So we essentially keep checking every property's calendar every uh every day to say, okay, what is going on? Like today these dates were available, tomorrow they are not. Multiple things could have happened. Uh, and suppose for like this is how today all of May was available, tomorrow, May 10th to May 14th is unavailable, right? Uh five nights are unavailable. To us, it could be that the uh it was a booking on Airbnb. It could also be a booking on Burbo, it could be book a booking on a on your direct website, somebody could have called and booked. It does not matter as long as it was booking, those four days will or five days will disappear, right? Um in this case, if we make the assumption that, hey, four days disappeared or five days disappeared, it must be a booking, we would be right, regardless of where it came from. It could also be that they had a long-term maintenance due, and they said these four dates are when I'm going to do it. Uh and we wouldn't know any better because the late, all that we get to see is whether the date is available or not, right? Like what else can you do? Uh, this is where Micah's question of like, hey, can you also see uh uh what's happening like from the direct data to see like uh thankfully, if there is a maintenance kind of a thing, it's not like a hundred properties will have the maintenance on the same dates. So it's not like it will show up as a spike on that day. But if it's a true demand event, then it does show up as a spike on that day, right? But uh what I was trying to say was regardless of where the booking comes on, the outcome is the same. And that outcome is what we are monitoring. If that makes sense.
SPEAKER_02That makes a lot of sense, yes, yes, yes. And um let's just say in the last few years, uh millions uh of new hosts have entered the the Airbnb, you know, market, right? It's been an explosion. So a lot of these, um a lot of them that I know that I speak to, you know, the ones that are starting off that have one unit or two units, they're not really using, I mean, a lot of them don't use the dynamic pricing. A lot of them might not even be using smart pricing, they might just be manually putting it all at a hundred bucks a night or whatever, or fifty bucks a night. Really, really plummeting the market. So, how does that, I mean, how does that affect people that like us that want to utilize dynamic pricing, but other people are just giving away their house so cheap?
SPEAKER_04Yeah, um, I think I'll come to that. But I thought these days when you sign up as a new host, smart pricing is automatically on for you. Like you have to actively turn it off if you don't go.
SPEAKER_02Actually turn it off. Maybe, yeah, I don't know.
SPEAKER_04But even so, like that itself is usually low, right? Like, so your your question is still the same. Like if if every new host that's coming up is pricing low, like what do you do? Um from a pure from an algorithm perspective, at least in every pricing system that I've seen, you as a user still has the control to say, like, hey, all of these homes are inexpensive, but I know that demand in this location is willing to pay a lot more. Uh, I'm going to put my home at 200 bucks a night, although everybody else has it at 100 bucks a night, right? So you still have that control. And when you say 200 bucks a night, it means maybe during high season or peak dates it will go higher and last minute will go lower and all that stuff. Now you could do that, you have that control with any dynamic pricing provider. You don't control the guest, so the the guest, if they are finding enough options to book for hundred bucks, and if the options are good enough, then then they are going to book it. Like uh, and if there isn't enough demand, then and there are enough of these good enough properties that are cheaper than you, it's quite possible that they get booked and you don't. In response, you will get feedback, you will see that hey, my calendars are empty, like I need to do something about this, and you will say, okay, it used to be that the market was a $200 market. Now uh it there is so much supply, I need to react to it and I need to lower my prices. We provide sort of uh we provide base price help and all of that stuff so that you can see, okay, is our recommendation to go lower or not? We generally say you should uh accept that recommendation, but but uh you should choose for yourself. Uh but sometimes the option is to say, like, okay, uh need to go lower. Sometimes you can also play on the value part of it. Uh, like if your reviews are really good, if you have plenty of reviews, you can still stay above the market. And there are guests who who prefer sort of the trusted host rather than the new host, and and who will hopefully book you. But all of that shows up in like one as as a host, you do your best in differentiating your property. But if nothing else is working and there is demand and it's just booking cheaper stays, you have to eventually think of lowering your prices, right? Um, that's unfortunately what uh economics is.
SPEAKER_02It reminds me of um way back in the when Southwest Airlines would would go to a new city and do their freaking $59 fares and on. And they would literally put airlines out of business. I mean, they didn't want them to come, you know. So, but they had what could they do? They were charging $300 for a flight, and the Southwest would come in and charge $59.
SPEAKER_04But then, like only if It is uh realistic, like if Southwest and clearly Southwest could sustain their business at 59 bucks, right? Uh, if somebody is doing it at 100 bucks and not being profitable, not being able to pay their mortgage or whatever it is, uh, then sooner or later that's not going to sustain, right? Uh so uh if if it looks like yeah, there is even after paying um charging less, getting all the bookings, you are able to like sustain a business, then that is a business by definition.
SPEAKER_02Yeah, I remember Micah said he uh Micah brought it up, made a good point because he's like there uh Houston got really oversaturated. Man, everybody went to Houston because there's no there was no rules against um no permitting, no rules to get into it. So everybody and their mama got an Airbnb. And so well, the thing is there was people that were able to rent out like full homes for like you know a hundred bucks a night or or cheaper, 50 bucks a night for a whole house, right? But Micah made a good point. He said, Well, a lot of those people own those homes outright, yeah and the and they're paying all they're paying is property taxes or whatever and utilities, and so they can afford, like you said, Southwest Airlines could afford to do 59 bucks a profit, and the people that own these houses could. People that were paying 2,000 a month for an arbitrage are getting screwed because they can't they can't profit at that mark.
SPEAKER_01Yeah, and and that's why I think pricing has so much um there's there has to be so much data, like you said it earlier, you can have a two-bedroom sitting next to another two-bedroom, they're exact same, but something's going on, then they're not pricing the same, you know. And then I think that that's what it goes into. Because if you look at uh, I'm gonna use this for example. I used to work at um I used to push in the carts for Safeway, right? Safeway's pricing, their grocery were grocery prices way more than everybody else, but only older people shopped at Safeway because you could get a guy to bring to push out the groceries for you, you get better customer service. Okay, yeah, and that's what I used to tell people. I'm like, if you're in the short-term rental space and you want to price higher, you need to have a good customer service type of product that those types of people want. It's kind of like on Virgo, they're willing to pay more. But this is one thing I do will say about Verbo, they do want their handheld. You might have to get on the phone with them, but they'll pay you more for it. So, yeah, you know, a lot of factors. And I think I think with you guys having all this access to this data, I think in the future, yeah, bright, because you can start using that and kind of comparing and showing hosts what you need to do to be a good host.
SPEAKER_04Yeah, that is something that we are hoping to get to as well, because it's it's a part of the larger umbrella of revenue management, right? So revenue management has pricing, restrictions, state restrictions, but then also like, hey, what can you what should you do to your listing itself to to improve your your performance, right? Yeah.
SPEAKER_02Now here's here's what I don't understand. Um, so you know, uh Airbnb is this gigantic multi-billion dollar beast, right? And and and so why why would they even want to mess around with something like smart pricing and do it in-house, where they could just partner with someone like you guys and say, hey, you know, this uh this smart pricing brought to you by Price Labs, kind of like how Apple, you know, they they have the iPhone and you you you hold it, you hold it up, and you what song is this? And it and it tells you, and it says brought to you by Sh Shazam or whatever, whoever does. They didn't they didn't try to do it themselves, they got a company that was already doing a great job at it and just partnered with them.
SPEAKER_04Uh don't know if I know the answer to that one.
SPEAKER_01Um they need you to be as low as possible so they can get all the money they can give.
SPEAKER_04No, so I think you think it might be at least early on. I think the thought was even now the thought for Airbnb might be to like get as much share out of hotels and get people to book short-term rentals, right? Get people used to short-term rentals. And like hearing what you have heard and I have heard, it seems like Airbnb's smart pricing prices things very cheap. Now they charge a percentage on every booking. Uh why would they do that? Like they should be looking to set the right price so that they then also like because it's whatever 15%, their share also increases, their revenue will increase automatically, right?
SPEAKER_02Uh it's been going up since I'll tell you that much because early days they wanted to price my house at like 17 bucks a night or whatever, stupid, right? Okay, but now and I remember when we switched back to it trying to trying to get out of this Airbnb bus, whatever. It was actually I put in some pricing, and it would actually say, Hey, you should put it at you know 300. And it was it was saying like higher, put the prices at higher. So it's going the other way. I'll give them that. They at least uh they at least want you to price it a little better than before at like $10 a night.
SPEAKER_04Yeah. Uh I did not think it was that low either.
SPEAKER_02But yeah, maybe not. It was low.
SPEAKER_04But uh no, but yeah, so like honestly, don't know the answer to that one. Like uh part of it is like if they are a billion-dollar company, they they think they have the resources, and and so they they try and do it by themselves, right? Uh the the sad, I don't know if I should call it the sad part. The strange part about this industry is it's so fragmented that even Airbnb does not know what the true demand is. You gave that example of somebody booking direct. Like we we often hear this about like our market dashboards or AirDNA or somebody else to say, hey, for this location, what does an average two-bedroom make? Or like how much does this property make? Nobody knows. Not even Airbnb knows how much this property is making. Because Airbnb is seeing some of the bookings that come through. Some of them come through booking.com, some of them come through Verbo, some of them on phone. And it's unless you own that home and look at the uh every single uh thing that came in or are managing that home, you you you just cannot estimate. Like you cannot know, you can estimate, but you cannot know what what that home is home is making, right? Um, so uh part of what it like given all of that, Airbnb still is sort of the dominant uh uh OTA in the US, at least, right? So it if anybody they have a really good picture of what the demand does look like. So maybe they think we should try our hand at this.
SPEAKER_01And one thing I will ask you is your your your comp set, because I know you guys have really gone into comp sets. Can you guys can you explain like how you use comp sets and how you can use them to give you better pricing recommendations?
SPEAKER_04So comp sets, at least the way we do. So there are two parts of comp sets. One is automated comp sets, like the ones uh for every property. We basically say, hey, what are the properties that are around you that that you should that we look at and say their occupancy trends should matter to you in some ways, right? Uh I don't know if you're talking about that one or where you there's another place in market dashboards where you can handpick your comps. Uh was that the one that you were saying?
SPEAKER_01The one where you what you were just saying, the one where you're automatically doing it.
SPEAKER_04Got it. Yeah, the automatic one is essentially uh we are constantly tweaking that one, right? So uh we used to do this thing where we would say, hey, we want to be very hyper-local, so that uh what location matters more than anything else, right? And so we would say you if you are a two-bedroom home, uh, we still want to look at a five-bedroom home if it is right next to you. Uh and then part of it is also because larger homes tend to book early on. So, like if there is something big happening, by tracking that five-bedroom as well, we get to know that something is happening. Uh, we have been experimenting over time to see, like, okay, from a pure price recommendation perspective, does this do better? Or if you're a two-bedroom, leave out the five bedrooms and six bedrooms out of the equation, even if they're right next to you. Now we what we found generally is that okay, uh, it actually makes the algorithm better if you just focus on very, very similar kind of homes. Uh, so that's that's a change that we made, I think about five months back, four or five months back.
SPEAKER_01Wow. Yeah. I love that.
SPEAKER_04So that is, yeah, like our algorithm is constantly uh getting its tweaks and fine-tuning and and and all of that stuff, depending on what we find. Yeah.
SPEAKER_01So to everyone listening, that is why it's important to have your channel manager and make sure you're updating your data correctly because then it gives you better data to send to Pricelabs so you can get better pricing recommendations.
SPEAKER_04That is true. Yeah. Uh although uh hopefully everybody has the right number of bedrooms in their channel manager because that's what gets published on the UTAs as well.
SPEAKER_02So uh you'd be surprised, man. Make a closet a bedroom. Um so so okay. I'm I'm really trying to get into peer space, right? Do y'all do y'all offer like then dynamic pricing for peer space, or is that just way hard too hard to do?
SPEAKER_04Not yet. And I'm blanking out on what exactly does peer space do.
SPEAKER_02So peer space is you can rent your house uh or apartment or condo, whatever by the hour. So they can come do a photo shoot, they can do uh even they can rent out your house and do like uh quincenita or a wedding, or you know, it it's for events, it's for events, but I don't yeah, I don't have any idea how to price that crap yet.
SPEAKER_04So I'm just I'm just I honestly have not looked at it clearly. I do not know what Pierce Space was doing.
SPEAKER_02Uh it's even for people that you know um that want to meet up and work somewhere, you know, they can rent rent out your home as an office or something like that.
SPEAKER_04Yeah, yeah. Um yeah, not not something we have looked at so far. Uh, do the general supply and demand principles apply? They probably do. Uh, is there enough volume? Like how many people are doing peer space in where you are?
SPEAKER_02Um, that's a good question. It's a lot. I know there's a lot because we've looked up places to rent for ourselves and do either um uh a meetup at or or whatever. And so there's a there seems to be a lot of selection, and it seems to be a lot of people that also do Airbnb and short-term rentals. They it doesn't seem it's one or the other, it's most of the time it's it's both.
SPEAKER_04It's the same, like wherever you get booked from, you take it kind of a thing.
SPEAKER_02Yeah, yeah. Got it. So and yeah, that's all that's the only question I had on that.
SPEAKER_04I haven't haven't looked at it or thought about it, but if it's by the R, then a few more variables come into play, right? Like uh honestly, we'll have to look at data from there. Like, how often how often are there peaks? So, for example, like I'm sure there are going to be day of week trends. Uh like weekends are going to see the pinatas, and weekdays are going to see the get together and work kind of a thing and and whatnot. And we don't know what the volume is, but there must be some trend there, right?
SPEAKER_02Uh yeah, yeah. I was gonna say real quick. Because we're we're working with uh a guy that that I know uh he's letting us take over our his house, and he wants to do us to do the peer space side of it. He's he's gonna stick with handling the Airbnb side of it. So you can link the calendars. At least you can link the calendars. Oh wow, okay, yeah, yeah. ICAL works. ICAL works. Uh yeah, it works. It takes a couple days, but it it it finally maybe Micah knows better. Finally, uh it finally, and so um, so what I what I'm lost my trade of thought. So, yeah, so like I said, we're gonna take over his house, we're gonna we're gonna try to try some things. He has he's sitting on two acres, it'd be good for like weddings and stuff like that, right? It's it's it's beautiful, you know. And um, so so yeah, the oh the interesting thing about about Peer Space is it gives you three different ways to to rent the same house, you know. You so you're making like three different listings for the same house. I don't know if that's new. Like I said, I've just started messing around with Peer Space. One of it is for meetings, I think. One of them is for media, and then the other one is for events, but it's three different things. So someone goes on there, hey, I want to do a wedding, blah blah blah, it'll pull up my place as an events place, you know. If someone goes on their meeting, I guess it's gonna pull up the other listing, so it makes three listings off of one uh uh listing. Yeah, it's weird.
SPEAKER_01Yeah, one thing I will say about that if they're if you're doing the Airbnb and Peer Space thing, the problem that comes up is people know that if they book on peer space, it's gonna be a lot more. So a lot of people will scour peerspace and go look for the Airbnb listing and book it on Airbnb because they know I ain't about to pay this by the hour if I can just book the whole night. So one thing you also have to look at with Peer Space is it you almost have to, it's hard to do both successfully because you almost have to dedicate that place for peer space. You see what I'm saying? So, like if it's good for weddings, you would just need to call an event planner or wedding planner and just kind of pick their brain, just kind of ask open-ended questions like hey, how much do you usually charge for an event space? And they'll tell you how much the price is. You don't have to tell them it's yours, but that'll start giving you that idea. So, yeah, now that's interesting if you guys would get into that peer space pricing. But yeah, go ahead.
SPEAKER_02The only difference I would say, because you said, Oh, I found it on Airbnb for a hundred bucks a night instead of paying you know 250 for a few hours or whatever it is. That you can't if you rent it on Airbnb, you're you're technically not allowed to have a party there. Whereas if you rent it on the peer space as a party event, then you you can have your your party there.
SPEAKER_04Correct. How those change depending on what you do, what you want. Exactly.
SPEAKER_01Yeah, so yeah, if you guys were getting into that data.
SPEAKER_02Yeah, uh I'm diving into uh I'll let you know, man. I'll I'll give you a phone call. I don't know.
SPEAKER_03I'm going to look into this as well.
SPEAKER_02Do you offer? Yeah, does pri does does uh price labs offer um pricing tutorials or or you know videos or stuff to help help people?
SPEAKER_04Do so one, our YouTube is very rich, YouTube channel. Uh, but even more important, every day we do live uh training and onboarding sessions. Uh so every day it's a live training and onboarding for new customers, uh, or actually not new customers, even if you're not a customer, you can join in. Uh and then uh once or twice a week we do sort of the advanced sessions where we say, okay, now that you're into it, uh, if you want to sort of up-level uh how you do things, or just have open-ended questions, uh, those sessions are uh essentially um uh a few times a week, and then every day there is a group onboarding session.
SPEAKER_01Now, one question I didn't have to you ask. I don't know if you want to you might you don't have to answer this and you don't have to let the cat out the bag, but you know with pricing and the data that you're collecting, are you guys eventually gonna go into AI?
SPEAKER_04Uh what do you mean by that?
SPEAKER_01Like using AI for your pricing, like you know how chat GPT is taking over, and then there's a bunch of AI stuff out there. A lot of people saying that's scary, how powerful it is. Could you guys eventually would you guys be looking to eventually get into that for your pricing?
SPEAKER_04Got it. So um this is a hard question to answer. I will say why.
SPEAKER_05Okay.
SPEAKER_04So there is a there's a broad umbrella of uh uh so in computer systems, there are systems that you tell them like A to B to C to D is like it's almost rule-based, like Excel is like that. Like you write down the formulas, you tell it what to do, and it does it, right? Uh, and then there is stuff where like uh you don't you can't know the answer going into it. There is a bunch of data that is being consumed and churned, and then some output being given out. Um there is there's numbers, there is languages, there is images, uh, and then there is yes, these are the three main things that at least I can think of right now. Chat GPT is on the on the language side. Uh stable diffusion and those kinds of things are more on the image side. Now for image and language, something called neural networks, which sort of mimic our brains, are very popular. Um, and so that's they don't mimic, they try to mimic our brains, uh, are very popular. Uh but uh and today at least that's what people think of as AI. There is also a bunch of stuff about uh just coming up with a price recommendation, depending on who you ask, they will say this is AI, versus somebody else will say, Yeah, this is just a statistical model. Like uh but deep underneath, everything is a mathematical model in some ways. So like it's kind of hard to say, like, okay, we get into AI. Most people, when they ask that, in at least in the data science world, seem to ask, are you going to use neural networks? And that question, at least to me, is uh unlikely for the foreseeable future.
SPEAKER_06Okay.
SPEAKER_04Uh the biggest one is I don't know if you in ChatGPT if you've tried doing this, where like if you ask it a math question, it it fumbles very frequently. Like it could be a simple math question and it it it will potentially get it wrong. Uh so chat GPT is essentially looking at all the all the articles and text written in the internet and saying what words frequently follow these other words. And when you ask a question, it's essentially trying to come up with the best possible combination of words to spit out. It happens to be that they've built it so well that it often makes sense. Uh, but a lot of times it also doesn't make sense. Uh so like if you uh I've seen examples where if you ask it who wrote this book, and you can make up a book that doesn't exist, ChatGPT will still come up with an answer of an author.
SPEAKER_01Uh so uh has some political stuff behind it, huh? But yeah.
SPEAKER_04I mean, I don't know political, but it's more like uh it's like a parrot who has been taught, and then if you ask it a question, it uh it doesn't know, like, okay, this thing doesn't exist, but he's like, okay, author, let me find out what authors exist and spit out one of those names.
SPEAKER_02You know, that reminds me, it reminds me of the dude at work that's uh that's a bullshit artist. They call him. You ask him anything, and he has an answer, a long-winded answer for everything, even though he's bullshitting. Anyways, that's chat GPT.
SPEAKER_04No, but uh so not saying it's not useful, it is very useful, but when it comes to numbers, there is you need some precision, some predictability. You kind of want them to be, right? More often than not. Uh so so uh yeah, for for anything to do with numbers, it's it's a little uh not at least today, not the right kind of tool. Um, and of course that could change in the future. Like there is plenty of stuff that even for language processing that 10 years back, people would have said, no, this is probably not going to work, but clearly it is working now, right? Uh so never say never, but at least the way it is today. Um for something as uh in my eyes, as important as a pricing algorithm. You you when you give an answer, you want to be able to back it up to say, why is this the answer?
SPEAKER_02Now, now this is weird, and this might be uh this might be perception, it might not even be anything to do with data, but I've seen all these VRBO commercials, and you've probably seen them too. It's like at VRBO, you're gonna enjoy your stay because you get the whole place to yourself, and they're just trying to beat that into our heads. I'm like, Airbnb, you get the whole place to yourself too, right? What are they making Airbnb like you're you're you're sharing a room with some stranger or something like that? Now, are they is that is that uh data driven, or are they just saying it's just a perception people have?
SPEAKER_04I think it's uh they are one, Airbnb allows rooms. I think verbot does not allow rooms, right? So uh, and then there is also, although Airbnb doesn't have as many rooms as as people think, like it's it's fairly limited number. Uh as in in comparison to homes, right? The percentage is not as big. Uh, but at least when Airbnb began, everybody thought of it as uh shared rooms and and private rooms. And Airbnb has now become that. So I don't know if Virgo is just playing on that strength, and they are like, hey, five years back, people had this thing. Let's remind them that we are the original full home provider. Uh Something to that effect.
SPEAKER_02And then the the hotels, I forgot which hotel's doing this the scary commercial where you go to a house and it's like uh these dolls are over there and it's like real spooky. Forgot what hotel's doing that, but they're trying to play on the command. I don't think I've seen that one. So yeah, I don't think I've seen that one.
SPEAKER_01No, that's a verbal commercial.
SPEAKER_02Is that a verbal commercial?
SPEAKER_01Yeah, it's a verbal commercial. They're attacking them from all angles.
SPEAKER_02They're just playing uh people's fears up, but I think it it might be falling on deaf fears because everybody has Airbnb app on their phone. Every even old people at work they do Airbnbs now. So I mean, okay, you're attacking them, cool, but they still own what 80% of the market share. I don't know what the number is. Anyways, I thought you might know.
SPEAKER_03No, I do have to stop it five minutes.
SPEAKER_02Uh okay, that's okay. Yeah, we can wrap it up. We're having fun.
SPEAKER_04I will say the questions have been more interesting and harder than a lot of podcasts I go to. Like Google.
SPEAKER_02We're doing the shit. We're not bullshitters, we're doing this shit.
SPEAKER_03I know, like going for it.
SPEAKER_02We're using you to improve our business. I um I apologize for that. Most podcasters are doing this. Um Airbnb podcast have like one or two, or if they're even doing it at all, whatever. But, anyways, we're the real deal on a rug. Yeah, uh know that.
SPEAKER_01Yeah, I'm a real fan of your your you guys. Um, I started using you years ago when my good friend uh my friend out of Chicago told me about it. So that's what I've been using. And then I've like I loved how you guys have steady grown, grown into the PMP, getting getting everyone on board. So yeah, the market dashboards are awesome as well. So yeah, keep doing it and uh thank you for coming on and uh continue to uh keep improving your product.
SPEAKER_02And I where can people find you? Where can people find you, my brother?
SPEAKER_04Yeah, so uh our website is pricelabs, which is right here. Pricelabs.co.
SPEAKER_02Never bought the M. You never bought the M.
SPEAKER_04We actually did.
SPEAKER_02You bought the M.
SPEAKER_04Yeah, pricelabs.com. Uh I mean we still have everything in.co, but if you happen to go to pricelabs.com, it will redirect to pricelabs.co.
SPEAKER_02Uh how much did that cost if you can say? Can you say that on the air?
SPEAKER_04Uh not as much as we thought it would. Really? Surprisingly. Yeah. We were basically just disinterested in it. Uh somebody approached us and said, Hey, do you want to buy it? And you're like, How much? And they're like, This much. And you're like, if it's anything more than one-tenth of what you're saying, we have no interest in this. Um and so the option to them was like either hold it indefinitely or or make whatever they can at that point. Because we honestly did not see value and like too much value in having the uh like most people, even like today, who are customers, would Google and then click on the link, anyways, and and not type in priceless.co. Uh or the moment they start typing, the browser will autofill, like all kinds of things happen today to where like the exact URL is is not as important as as it used to be 10-15 years back, right? Like in 15 years back, if you if you if you had .co, like nobody would get to you. Everybody was typing in.com. And you know, yeah.
SPEAKER_02Cool, man. Well, thanks for hopping on. Uh, we look forward to uh chatting with you again in the future. You're always doing new stuff in this industry, and you've helped us make uh a lot of money, so we appreciate that.
SPEAKER_03Yeah, good. Thanks a lot, Steven. Thanks a lot for Michael for the kind encouragement and words.
SPEAKER_01Yeah, oh yeah, thank you. And uh we'll see you next row round. Oh, real quick, are you gonna be at any r event in the future?
SPEAKER_04I am going. I'm going to I'm actually going to the MTR summit in San Diego at the end of this month. Okay. Uh and then I will go to VRMA. I don't know if you guys have been to VRMA. I'm gonna go to VRMA. Yeah, that one's in Orlando, so uh yeah.
SPEAKER_01All right, we'll be seeing you soon then. We'll be seeing you soon.
SPEAKER_04Yeah, it'll be fun if you guys go up there.
SPEAKER_01Oh, yeah, for sure. We'll definitely be at one of them.
SPEAKER_06See you guys. Yeah, bye.
SPEAKER_01Another good episode, another good app, man. Um, yeah, yeah, yeah. Price labs is really on top of this stuff, man. I love that they've they're able to grab a lot of data that you know air DNA can't grab, you know, because they're just looking at block dates and pulling crap out of their ass. But no, man, uh yeah, man, this has been around a really good episode. I actually got to hang out with a friend of the show last night, Mr. Al Williamson. So he dropped some gems last night out in Fort Worth at the botanical gardens, and he was, you know, his pricings are totally different, you know. It's his pricing's based on the per diem when people have to come into town because he mainly goes to corporate. So yeah, yeah, I'm getting into that mid midterm rental market as well. But um, yeah, this has been a great episode.
SPEAKER_02Adam Rag, man, he's a bad dude. Uh Price Labs. You got me on the price labs because uh back in the day we were all started, I think, on beyond pricing or whatever. But then we're like, holy crap, you could do all this stuff on Price Labs, and it was it was, I mean, it's it's it's funny because it there's so many tools on there, so many different things you could do, but it doesn't feel complicated. Does that make sense? It doesn't feel like it's hard to like a hard system to use, it's it's user-friendly, but it can get really super advanced if you want to use it that way, yeah.
SPEAKER_01And that's what I love about it. So, like the people who do have a lot of properties and need that advanced data, it's there for you, you know. Because it honestly, if you are gonna be on OTAs, you do need advanced data. So, like the people probably people who had advanced data didn't get hit with the Airbnb bust if they were, you know, depending upon it. And that's very important. Like, I know Federico says it all the time you have to be educated in this space, so yeah.
SPEAKER_02And it reminds me a buddy of mine was was busting the chops of another buddy at work, and he was saying, Oh man, he's playing, he's playing checkers. I'm playing chess. So smart pricing is playing checkers, and price labs is playing chess. I brought it all back together. There you go. Where can people find us, Micah?
SPEAKER_01Hey, you can find us on Instagram at Live Let Thrive, TikTok on Livelet Thrive. Send us an email, liveletrive at gmail.com. Remember to like, rate, leave us a review, and uh yeah, and we will be having probably another meetup here in the next quarter or so. And uh, for everybody that does come out to the meetups, thank y'all. And uh yeah, can thank y'all for continuing to listen to us as well. We're gonna be dropping some more heat in the next few weeks. Hopefully, we're gonna hit episode 300 by the end of this year. So uh we are out.
SPEAKER_00Peace later. Thank you for tuning in to this week's episode of Live Let Thrive. Be sure to tune in next week for all the latest in the world of Airbnb and all that entails. Bye bye.
People on this episode
Podcasts we love
Check out these other fine podcasts recommended by us, not an algorithm.
Real Estate Rookie
BiggerPockets
Entrepremarriage
Myka & Mahogany
The Co-Living Show
Craig Curelop and Miller McSwain
BiggerPockets Real Estate Podcast
BiggerPockets
LEAN Podcast
Mahogany
