It’s your slow season.

It’s 11 pm on Tuesday night and you decide to pop open your pricing dashboard.

Your next two weeks are bare:

• 10 keys
• 0 bookings
• $0 revenue

And the voice in the back of your head says “let’s drop prices until we start getting some bookings".

So you do…

A week later, you look and see the same thing. So you drop prices again.

Next thing you know, you're priced 30% below where you started, the comp set is doing the same thing, and you're booking guests at barely above your floor price.

Welcome to the race to the bottom.

Most operators think it's the cost of doing business in the slow season.

But it doesn’t have to be.

You just need the right strategy so you can avoid it.

Today’s play is the strategy:

THE WRONG WAY

Many operators handle slow season one of two ways:

• Set a flat rate and forget it. Pick a number that feels reasonable for the slow months and post it. The simplest play in the book. Also the most expensive.
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• React emotionally to an empty calendar and panic-drop prices until someone books. This is what we walked through above.

Neither is a strategy. Both leave significant money on the table.

Quick question before the play: if you could book every night in January at $350, would you rather do that, or take your chances trying to fill at $500?

Keep your answer in mind. We’ll come back to it.

THE PLAY

There's a play we run during the slow season called the Pink Line.

You draw a line at the bottom of your comp set, sit 5% below it, and hold your spot. If they move, you move.

Why?

Back to that question. Here's an example scenario:

Strategy A: Hold rate at $500 and you book it 50% of the time. Expected revenue per night: $250.

Strategy B: Price the Pink Line at $350 and you book it 95% of the time. Expected revenue per night: $332.

You make $82 more per night by being cheaper.

The numbers are for illustration but you get the point here.

The empty nights are what kill you.

So, here’s how you avoid them through the Pink Line framework.

Step 1: Set the floor 120+ days out.

Most operators set their slow-season rate too late.

They wait until the calendar is half empty and their emotions are involved in the pricing strategy.

The Pink Line is the rate you set when it’s most advantageous for your property.

Why?

120+ days out means you have a lot of time to take advantage of Step 2 and book your property up before the competition begins panic dropping prices.

Step 2: Price 5% below the bottom of your comp set.

The bottom, not the average.

Make sure to find the most comparable units. Not the cheapest in your market but the cheapest among competitors most similar to your property’s style and amenities.

When a guest is browsing a dozen similar listings, you’ll be the most attractive option when it comes to price.

Step 3: Watch your competitors’ calendars, not the clock.

Watch your comp set once a week.

If the bottom price drops, your floor adjusts with it

Otherwise, you hold 5% below the bottom.

And remember, the Pink Line is specifically for low demand seasons.

You want people to book you first, so you avoid the race to the bottom when it comes to other operators in your area.

THE PROOF

Lafave came to us operating without a data-driven pricing strategy.

First 30 days under our system:

$125,000 more in revenue than the same month a year earlier.

That's a 43% lift, year-over-year.

What drove the lift was a proper revenue management system.

The Pink Line is one of our core concepts.

And it's a concept you can install yourself this week.

THE TAKEAWAY

Ben Wolff

Founder, Oasi & Modern Hospitality Accelerator