What is Simplified Pricing?
Historically, Airbnb has had a single fee structure for all hosts, in which a service fee is charged to both the host (3%) and the guest (10-20% in most cases). In 2020, based on feedback from many professional hosts, Airbnb launched a new fee option for software-connected hosts to remove the guest service fee and provide hosts with more control over their rates. This fee structure is known as Simplified Pricing. Simplified Pricing (15% host fee) will be the only available fee structure to all software-connected hosts on Airbnb globally
What does it mean?
- Airbnb will deduct a flat 15% host service fee from each payout and won’t charge a guest service fee
- Simpler Pricing Strategy
- You will know exactly how much a guest is paying
- There is no guest service fee added to your rates which makes your listings more attractive
- Increase SEO ranking in Airbnb
- Even if you markup your rates, guests will still pay very similar rates (sometimes even less) than they did under the split fee model
- Hosts & PMs that keep their prices competitive across channels have seen an overall increase in bookings (~17%)
- Markup tool - easily adjust your prices to account for the new Airbnb fee structure
- Direct Bookings - use the Hostaway booking engine to capture direct bookings and avoid channel commissions
- Expand to other channels and increase overall revenue
- Manage all channels from one unified dashboard
- Use the upsell tools to drive more profits
- Use the Guest Book and Coupons to encourage past guests to book direct next time
- Give Owners full transparency with the Owner portal and owner statements
How to Prepare
- Add your ABN/VAT number - To prepare for this change, please make sure that you have added your VAT information to ensure Airbnb does not withhold VAT/GST on your host fee on Airbnb. Add your VAT number here
- Adjust your rates (if needed) - Since a larger service fee will be deducted from your payouts, you may want to adjust your prices through Hostaway to cover the difference to ensure your earnings don’t change. Before adjusting your prices, keep in mind that it’s important to stay competitive. Most of our clients use a markup of 15%
- Cleaning Fees - Airbnb charges 15% to the total value of the booking (Nightly rate + Cleaning Fee). You may want to adjust your cleaning fee as well.
- Inform your owners - it is important to let your owners know about these changes and explain the benefits of using Hostaway. Our platform is designed to help you increase bookings, improve guest communication and give the owners more access and transparency.