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Airbnb Independent Guest Ratings Can Launch or Crash Your Expectations

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Many holiday homeowners think I am crazy when I propose very competitive rates on Airbnb when launching a new property. 

I must say that I would rather choose crazy than stupid. 

In previous writings I have argued why Airbnb hosts need to make love with Airbnb by making them money. If you do they will make you money. 

Today I want to change the focus slightly. 

Why?

This is the first time I could find data supporting my crazy ideas.

It has to do with trust. 

You know about all the scam issues using the internet. People are very skeptical. And it's your job to turn that skepticism into trust. But alone you'll not do it. You need independent guests who turn the story for you. The turn comes when these guests leave reviews. There's such a lot of resistance when you list a new property. Have a look at what one client had to say to us about a lovely new home we listed. Eventually she booked the house, but it was not easy. And most potential clients would not even bother to get answers. All they'll do is go to the homeowner with many reviews even if the house is not so nice.

Trish Leonard Potential Holidaymaker

My husband and I (ex Zim long ago!) are bringing our Godson (aged 22) from UK to SA for his first trip to Africa and we are being joined by old 'varsity friends from Natal. We need 3 bedrooms and preferably 3 bathrooms, with sea view. Love "Dorian - newly renovated" on AirBnB but don't understand why it has no reviews. What's wrong with it? or am I being too cautious? As you can imagine, I want the trip to be just right! My grandparents lived in Fish Hoek so I know the area fairly well - any suggestions?

Let's move into a different gear. And look at how you can increase occupancy as your number of independent reviews increase. 

airbnbratingvsoccupancy

The graph above shows the average occupancy over 365 for the average number of ratings per listing. Places with no ratings have very low occupancy. (These figures are based on USA listing only and provided by EverBooked - unfortunately they have no data for South Africa). 

Let's look at another graph

self catering occupancyvsreviews

Significant to say the least!

Only after about 250 reviews do proprerties achieve full occupancy potential.

It's clear that you have a lot of work ahead of you if you have no reviews, or very few reviews.

It can be done!

It’s not just the ratings that have an affect on the occupancy of the listing but the sheer number of ratings. There is the possibility of a mutually reinforcing relationship here between higher occupancy and higher numbers of ratings— more guests equals more ratings and more ratings equals more guests. Notice that for listings with 10-20 ratings, the average occupancy is already over 20%, above the overall market average. This data underscores the need for new hosts with young listings to adopt aggressive ramp up pricing in order to get bookings early to obtain as many ratings as quickly as possible in order to move up along this occupancy curve. (Source LearnAirbnb.com)

The most obvious solution is aggresively competitive rates to attract most guests to review your place. You need to pay for the right to get many ratings by making less than what you could if you have had 250 ratings.

Also never forget Airbnb and their choice to give you front page exposure..... Airbnb only gives you front page exposure if you make them money!


Let me again give you 3 things you must focus on to maximise your rental income:

  • Ensure your rates are extremely competitive; less than your neighbour with the same home may not be enough.
  • Only pay a professional to take photos of your place
  • Your first aim is to get 40% occupancy or at least 40 ratings.

Good luck.....

I am sure many who read this would again say I am crazy suggesting the above. But then again rather crazy than stupid.

Have Fun!

Johan Horak

P.S. Johan is part of Horak Clan @CapeHolidays.info. The clan runs a small self-catering agency. The clan is not interested in being the largest agency. No! Only the best agency.

When you launch your new listing on Airbnb you sit with a delimma. You have no credbility!

But there is hope, if the owner is humble. 

Today we will dicuss trust and how independent reviews, rates and standing out can launch your listing.

Trust is earned, but be warned there is a price you pay to gain it. Are willing to lower your expectations, initially? If not, the lack of resulst will speak for themsleves.

If your place stands out you will lower the trust treshhold barrier to some extent but if your home has no special charm then only tons of 5 star reviews and irresistible rates will improve trust.

I propose to homeowners to error on the low daily rate side (btw: anyone who can afford a holiday is above the norm) rather than high rates which mostly follow from these kinds of  common objections; “but do you know how much it cost to travel overseases? Do you know how much my house will rent out in Paris?”. 

Let’s be humble and learn to crawl before we run. 

This is what you need to limit the resitance towards guests booking:

  • Ensure your house stands out
  • Get many positive reviews
  • Have competitive rates – after the crawling phase the sky is the limit for  homes.

In previous writings I have argued why Airbnb hosts need to make love with Airbnb. If you do they will help make you money, they will promote your listing to the front page. But why would they add a new listing to the front page if it has no reviews and the rates are above the norm. Airbnb does not have an easy way to establish sellability. Airbnb cannot calculate ‘wowness’, but they know how many people view the property, reject the property, how quickly it get’s rejected, how quickly a place gets booked, the number of positive reviews, and the comparitive rate. 

If you have no reviews, the above measures are not in their favour you’ll end up on the lowers shelves – the last pages. And what will you have to bank – nothing!

If you agree with me, that we lower your rates until we get bookings, then:

  • Airbnb may promote you to page one
  • You’ll have money to bank regularly
  • You give guests the opportunity to review your home
  • You get feedback from guests you can use to make your offering better
  • You can start adjusting rates upwards as our occupancy slowly improves

Now consider the owner who is an unwilling, uncompromising, judge of his own value:

  1. His home may never reach page one soon.
  2. He may have nothing to bank
  3. He will get fewer reviews over a long time
  4. He will blame his agent or Airbnb for being incompetent
  5. He does not have any proper feedback

Let’s talk about trust online and how it will launch or crash your business.

You know about all the scam issues using the internet. People are very skeptical. And it’s your job to turn that skepticism into trust. But alone you’ll not do it. You need independent guests who turn the story for you.

There’s such a lot of resistance when you list a new property. Have a look at what one client had to say to us about a lovely new home we listed. Eventually she booked the house, but it was not easy. And most potential clients would not even bother to get answers.

 Holidaymaker

My husband and I are bringing our Godson…to SA for his first trip to Africa and we are being joined by old ‘varsity friends. Love “Dorian – newly renovated” on AirBnB but don’t understand why it has no reviews. What’s wrong with it? or am I being too cautious? As you can imagine, I want the trip to be just right!

Read that again: What is wrong with it? 

Now you are in the mind of a skeptical guest. She expects reviews. She doesn’t even consider that this could be a new listing.

This skeptic took the time to write to us and ask. How many would not even bother and move on?

Luckily this home has a special charm and the rate was too attractive and too tempting to be resisted. 

Let’s move into a different gear. And look at how you can increase occupancy as your number of independent reviews increases.

airbnbratingvsoccupancy

The graph above shows the average occupancy over 365 for the average number of ratings per listing. Places with no ratings have very low occupancy. (These figures are based on USA listing only and provided by EverBooked – unfortunately they have no data for South Africa). 

Let’s look at another graph

self catering occupancyvsreviews

Significant to say the least!

Only after about 250 reviews do proprerties achieve 80% occupancy potential.

It’s clear that you have a lot of work ahead of you if you have no reviews, or very few reviews.

It can be done!

It’s not just the ratings that have an affect on the occupancy of the listing but the sheer number of ratings. There is the possibility of a mutually reinforcing relationship here between higher occupancy and higher numbers of ratings— more guests equals more ratings and more ratings equals more guests. Notice that for listings with 10-20 ratings, the average occupancy is already over 20%, above the overall market average. This data underscores the need for new hosts withyoung listings to adopt aggressive ramp up pricing in order to get bookings early to obtain as many ratings as quickly as possible in order to move up along this occupancy curve. (Source LearnAirbnb.com)

The most obvious solution is to ensure your home stands out and has competitive rates to attract the most guests to review your place.

You need to pay for the right to get many ratings by making less than what you could if you have had 250 ratings.

Also never forget Airbnb and their choice to give you front page exposure….. Airbnb only gives you front page exposure if you make them money. Win-win.

4 things you must focus on to maximise your new Airbnb rental:

  • Ensure your rates are extremely competitive; less than your neighbour with the same home may not be enough.
  • Only pay a professional to take photos of your place
  • Continually improve your home and ensure it has that charm
  • Your first aim is to get 40% occupancy or at least 40 ratings.

Good luck…..

Some of you may think this is crazy, and maybe it is, but its been proven to work time and time again.

Have Fun!

Johan Horak

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