Best Strategies to Capitalize on Last Minute Bookings
A last minute booking is generally defined as a booking made within 14 days of check in. There is variability even within this narrow band with travelers booking 1-2 weeks time having more time and leeway in planning their itinerary vs those looking to check in the next day.
The risk of freshly imposed lockdowns and other travel restrictions meant people were booking last minute more than ever. As the pandemic has eased and revenge traveling continues to take hold, people are more prone to booking further in advance as they grapple with smaller budgets and less remote working opportunities. This however does not mean that last minute bookings are a thing of the past. With the desire for travel so high and people focusing more on spending time with family and friends, they are also more willing to take a trip at the last minute, especially if it’s within easy driving distance. Other reasons for last minute bookings like corporate travel while not on par with 2019 levels, remain. Meanwhile, as Hopper gains increasing traction, young travelers are also more willing to wait to be notified of the best deal, which in turn could push them further towards the last minute booking window.
According to an analysis published in September 2022 by Transparent in collaboration with last minute booking marketplace GetawayGoGo, 37% of bookings, on average, across world regions are last minute bookings. Thirty percent of bookings in the US were last minute of which 22% represented those made up to 7 days of check in. The numbers were slightly higher in Europe, accounting for 24% (0-7 days) and 8% (8-14 days). In Latin America 50% of bookings were secured within 2 weeks of check in while in Australia it was 36%.
Urban markets continue to see the highest number of last minute bookings with 65% (0-17 days) and 26% (8-14 days). Ski markets saw 32% of bookings fall into the category while 31% of rural market bookings were within 0-14 days of check in.
Meanwhile, travelers who book via their mobile devices are more likely to opt for last minute or even next day stays. Booking.com in particular allows for mobile rates so property managers can capitalize on last minute bookings by such travelers. Further, a pioneering 2018 study showed that travelers with the shortest time to check in (0-2 days) showed less involvement and took less time in decision-making over their booking.
According to the Transparent analysis, ADR is lower for last minute bookings, a 15% and 17% reduction for vacation rentals in the US and Europe, respectively. Length of stay also plummets with booking lead time, leading to an overall lower average booking value.
However, last minute bookings are a continued reality and have their place in the vacation rental calendar and not just for urban markets. In particular, they are useful for filling up gap days or orphan days in the booking calendar, ensuring maximizing of occupancy, revenue coming in and profit continuing to be made, even if they are generally of a lower value. Thus OTAs like Whimstay, GetawayGoGo, and HotelTonight have popped up to accommodate last minute bookings specifically.
It is important to remember that not all instances of last minute bookings are lower than average. Last minute bookings during peak seasons and events allow for higher rates as travelers scramble to find suitable accommodation in order to get to the experience they are seeking.
If you are trying to fill the gaps in your booking calendar with last minute bookings, adjust your minimum nights policy for the dates so they allow for shorter length of stays. This works with the last minute travelers’ tendency to book shorter trips. You can even create a rule to automatically allow for the same when such orphan days arise.
According to the 2018 study, price per night is the number one attribute considered in booking, across all groups of last minute booking travelers. A dynamic pricing strategy ensures you adjust your pricing with the contextual factors while using a dynamic pricing tool will automate this process.
Adjusting the price to be more attractive against competitors will not only make your Airbnb vacation rental much more likely to be booked but also help it rank higher on search on the OTAs you’ve listed on.
A complimentary gift like a bottle of wine made in your locale or a basket of muffins won’t cost you much but could be the incentive that pushes the potential last minute guest to book your property. A free experience is also an attractive enticement. There are also non-monetary options such as early check-ins or late check-outs.
Travelers booking last minute spend far less time making their booking decisions so don’t wait to respond to their inquiries. Automating guest communications through a fully-fledged PMS like Hostaway is the best and easiest way to do so. Quick responses on the part of the host also count a lot on Airbnb and have significant positive impact on the OTA’s search rankings. Meanwhile Zapier integrations will enable you to automate your guest preparations so you are fully ready to welcome your guests to their ideal stay.
If you are trying to fill orphan days at the last minute, you can also try getting in touch with guests who are booked right before or right after the gap and offer them the reservation at a decent discount. This not only increases your occupancy and revenue but also creates a favorable impression with your guests who may be more inclined to be repeat guests.
You can eschew adjusting rates and offer discounts instead. According to a 2018 US Travel Association Study, 53% of travelers are motivated to take a trip when they find a good deal. A traveler will find a discount a much more attractive proposition than a rate that feels marginally lower than your competitor even though there might not be a big difference between the two.
Make sure you let all your potential guests know of the great deals and/or special incentives that you are offering. Communicate it across your digital marketing platforms, from Instagram and Twitter to Facebook and Pinterest. Following these up with information about what exactly makes your property and locale such an attractive destination will help sweeten the offer.
If you are smart, you have amassed a database of guest contact information accrued from direct bookings and listing on OTAs like Hopper. While Airbnb masks guest information from hosts there is nothing stopping you from asking guests to sign a guest book with their contact info or ask for it when they register to access the free wi-fi in your property.
Send out an emailer to your list of contacts letting them know of the special last minute deals you are offering especially for your past guests. This increases the chances of them being repeat guests.
Hopefully, you have already optimized SEO for your vacation rental website so it ranks high for your location and core areas of your service.
This way, when you add content on special last minute booking details on your blog, it is likely to show up on Google searches for last minute bookings. Make sure you include keywords like last minute deals, last minute discounts, etc.
Google ads, Facebook ads and Instagram ads can get your last minute booking deals in front of more eyeballs increasing the chances of it being booked.
Because advertising incurs a cost it is important that the amount you spend makes sense against the profit you are making. Another perspective is to think of it as an additional branding exercise where you also get the word out on your vacation rental business.
There are a number of booking platforms that specifically focus on last minute bookings. Listing your property on those brings you in direct contact with the traveler segment you are targeting and can help fill your gap days faster and easier.
GetawayGoGo is a direct booking marketplace that only lists properties with an available arrival date of upto 14 days. Unlike most other OTAs it does not charge a commission or subscription fee from property managers or travelers. There is no onboarding fee either. Instead property managers are charged $10 if they receive a reservation and $7 when a traveler contacts them. If contact from a guest leads to a reservation, the host is only charged the extra $3.
GetawayGoGo allows travelers to directly contact the property managers and does not get in the middle of the conversation or booking. Reservations are made directly with the property manager’s reservation system and property managers are the merchant of records and funds are made directly with the payment processor. Travelers can also save their favorite deals or track them with GoGoRadar. GetawayGoGo integrates with a number of property management systems including Hostaway.
Whimstay is a sales channel for last minute bookings that caters to professional property managers with a portfolio of more than 10 properties located in the US, Canada and Mexico. It claims to offer exclusive deals on last minute stays with prices off up to 60% in comparison to other OTAs. Guests can also purchase insurance to receive full reimbursement in case they cancel their reservation later.
Interestingly, Whistay’s allows guests to split their payment between the different travelers in the group while its TripChat feature allows travelers to invite their friends and family to chat directly from the app or website. Property managers’ full contact information is provided to guests once they make a reservation. Whimstay integrates with a number of property management systems including Hostaway.
Niche booking platforms are another avenue to consider as they expand the possibility of your gap days being filled.
Because travelers who book (and not just search) using mobile devices are more likely to be booking last minute, consider offering special mobile rates to attract last minute bookings, a feature provided by Booking.com to its hosts.
According to Booking.com, over half of all its bookings are made on a mobile device. When you offer a discount exclusive to mobile users, a special badge appears next to the property in the search results and the property page, increasing visibility and helping to improve conversion. Partners offering mobile rates get 22% more bookings from mobile traffic according to the OTA.
Airbnb’s Instant Book is dreaded by a majority of hosts but it must be mentioned, being a feature designed specifically to incentivize last minute bookings.
Last minute bookings are a reality of the travel industry and represent a not insignificant portion of revenue. Forsaking last minute bookings altogether for their general lower revenue potential is not the answer. That just reduces the maximum revenue you can make. Instead, learn how to capitalize on them to best suit your needs. According to Transparent, over 175 million available nights went unbooked in 2019 accounting for a total revenue of over $35 billion.
Filling up your calendar is important but that doesn’t mean you sell yourself short to achieve total occupancy. If you’re not turning a profit then it doesn’t make sense. Learn how to manage your Airbnb finances including figuring out your starting and running costs.