I see too many people disappointed with their performance and their LCD once the activity starts. These people expect profitability, in just 1 hour of work per month, which is sold to them. I'm sharing with you here why you're being lied to about the automation of short-term rentals. And what you need to understand to finally see clearly!
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Hello and welcome to this video in which we are going to talk about why are we lying to you when we talk about LCD automation. If you don't know what LCD is, it's short-term rental. It's the same thing as seasonal rental, gîte, investment in short-term rental on Airbnb and booking. It's all exactly the same thing. I'll tell you why, in my opinion, you are being lied to about this part. It is the pillar of many people who train in real estate, and it is also the pillar for many people who want to invest in real estate. So, it seemed essential to me to take stock of this, and to be able to tell you why, in my opinion, we need to say things to each other, really, and to talk to each other about why this isn't happening. isn't real, it's not always possible? And there is another side of the coin, we need to talk about it.
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We are going to talk today about: how are we being lied to about this part of automation of short-term rental? I'm going to share four keys to this with you. I'm going to share with you why this is a problem, why the reality is not this, and what can we do, precisely, to avoid this? I obviously don't leave you with the problem by saying: "You see, this is not realistic", and then we stop there. No. I share ideas with you, and I will obviously focus on what is essential: the subject of price, obviously. In fact, why is the subject of price important? It is essential, because more than anything else, it will determine the success of your project, the success of your short-term rental. It might seem a little presumptuous to say: “The subject of the price is your subject, so there, obviously, is the Holy Grail, the center of the world, the navel of the situation. » My thinking is a little more subtle than that anyway, I assure you. Why am I telling you this? Because I make the metaphor with an athlete. In fact obviously, upstream, you have to make the right calculations - but having the right apartment, having a good decoration, having a nice ad, a nice title, a good photo, for me, all that is preparation , that is to say that it is like the athlete who will carefully choose the t-shirt that suits him well to avoid sweating, who will carefully choose the sharpest sneakers for the type of exercise he is doing. ready to do. He is there, he is ready, he has his outfit, he has his racket or his ball, but after that, once he has all that, once he is ready, once we have everything what you need in our short-term rental, we have the beautiful photos, the right title, the right ad, afterward, you have to know how to play the short-term rental game. Well that, for me, is what will be essential for your short-term rental project to be a success, whether it is in the service of the projects you have behind, projects of financial freedom, projects of earning money. time, plans to quit your job, continue investing, create assets for your retirement. All this will be determined by your ability to play the game well, to know how to react well during the short-term rental exercise. And for me, it's particularly the price. This is where it will be crucial. So, there you have it. This is why, for me, getting your prices right is a keystone to having a short-term rental that works, that works, that is profitable. So, the first key that I wanted to share with you is that we must not forget that preparation in advance is not enough. This is a bit of what I just shared with you.
But I have other things to tell you about that: today, when we want to automate, when we really have the objective of automating short-term rental and investing in that way , basically, what do we want? We want maximum profitability while spending as little time as possible. That's our goal. We want – I'm telling you this in class – that money moves as easily as possible. So. Basically, that's it. So if I want to automate, the idea is this. Except that in fact, in my opinion, we are lying about the realities: we are suggesting that if we prepare correctly beforehand, if we do everything necessary beforehand, afterward it will happen as we had planned. In fact, we are given to understand that if at the beginning, we do the right profitability calculations, we choose the apartment well, we do the decoration well, we do the advert well, and we do well, at worst, our first price grid, we say to ourselves: “come on”, and then, it will work. The reality is different. I really have an example which, in my opinion, is the most telling on this, to show you that it is not, in fact, fair to think like that. It’s like we’re a football team, we’re in the locker room, the coach tells us: “You’re going to do this and that. You are in charge of that, you are in charge of that. Our strategy is to come from the back, and then we run. » That's what they make us do when they prepare us in real estate, in general, and then we go into the field. But there, no one tells us what to do when we enter the field. When we enter the field, the competitors have their own strategy which can be totally unexpected. And so, the locker room strategy that we tried to put in place, we try to continue it, that's for sure, but we have to know how to react. We have to know how to react depending on the number of goals we concede, depending on the number of goals we manage to score, depending on the fatigue of the opposing team, their strategy, and how they react to our own strategies. Basically, it's a whole bunch of peripheral things which mean that at a given moment, the preparation in the locker room was not sufficient at all. So, on that, for me, we really have to keep in mind that preparation in advance is good, it's essential, it's clear, but it's not enough. It's as if — I take the example of tennis — we were all dressed, ready with our good rackets, the right sneakers, the right outfit, and afterwards, we remained frozen on the court. It's not going to work, that's clear. We are going to take bullets, and we are not going to win the match. So, we must not forget that preparation, as crucial as it may be, is not enough. We must then know how to react on the ground to the realities on the ground.
Now, there is another point that we talk about even more rarely, and for me, it is crucial. There is a real difference between “automating” and “delegating”. Automation really is when, in fact, it’s a machine that does things. Automation is when there is a process, if there is something that is predictable, and above all, there is a cause and effect link between a trigger and a reaction. That's what automation is all about. We can automate emails, for example. So. When such an event happens, we send an email. But if no event happens, well, we don't send an email. This is something that can be automated, that is to say that the machine does not have to react, it does not have to think. Now, delegating is different. Delegating is when there is a decision to be made, and when the decisions are not necessarily predictable. This is when it is necessary to diagnose situations to make the best possible decisions. That's delegating. Or when it is something that cannot be done by humans, for example, cleaning the apartment, it means delegating, because today, we do not yet have machines that are capable of to clean the apartments. So, delegating is really, in fact, what we are going to do on prices. Prices cannot be automated. Why can't we automate them? Because there are so many situations that it is almost impossible to anticipate everything. I think you will agree with me, it is impossible to anticipate the multitude of situations in which we can find ourselves depending on our performance, depending on the environment, depending on how competitors react. So, we're going to delegate instead. You have to be able to look at the situation at time t, and say to yourself: “In this situation, what do I do? Am I raising my prices? Do I lower the price? Am I not moving, exactly? " So. When we have to make decisions, we delegate, and we will not automate. That was really to explain to you that wanting to automate prices doesn't make sense. This is not something that makes sense at all. It is not a reality that is concrete. It doesn't make sense.
Now, on the “delegate” part, if you want to delegate the creation of prices for your short-term rental, there are three possibilities: the first possibility is to delegate to an algorithm. What is an algorithm? An algorithm is a sort of mini-human brain. It’s a system for which we have already programmed lots of situations, and to which we will say: “In such and such a situation, we must do this, we must do that, we must do that.” » It's a sort of mini-human brain. That's the algorithm. The second solution for delegating is to delegate to an expert, to someone who knows about it. And then the third solution, in fact, is to trust yourself, and to say to yourself: “I am going to train myself, I am going to inform myself, and I am going to be able to do this work that an expert would do for my activity. » So, on these three elements - it's not that I'm playing with words, I think that here, for once, the words allow us to realize what we're doing - when we say to ourselves that we are going to delegate to a pricing algorithm, that means that we delegate the decision-making of our prices, that is to say we delegate the profitability of our activity, we delegate our future in real estate, we delegate our ability to reinvest, we delegate our ability to have a better retirement, our ability to save time, you understand, I will stop with the examples. We delegate all this to a third of human brains to whom we have explained certain situations, and we say to them: “In these situations, you do this. » I think that at this stage, we realize, in fact, the importance of the thing compared to the risks we have in delegating it to a third of the human brain. So, if it's something you want to do, it's not a decision that I blame, but in any case, you really have to know what you're doing, and realize that in fact, you're taking there are risks in doing that, ultimately, and we take risks for the sustainability of our project. And that’s still crucial to realize. So my recommendation, obviously, is either to delegate to someone who knows about it, who knows how to do this pricing strategy correctly, or to learn it yourself. That’s crucial.
I will also explain to you, and this is my third key, why it is risky, in fact, to delegate to a machine. I give you four situations in which delegation to the machine, you will see that it does not hold water. Delegating to a machine, if I give you another metaphor, is like eating a homemade cake, and eating a supermarket cake. We all bought a cake at the crossroads. We all agree that the cake does the job of cakes. It's just that it's actually not as good. It tastes like sugar, a bit of chocolate, but it's also not the best cake you can taste. In fact, with pricing algorithms — in fact I should specify this, but when we say “pricing algorithms”, it is PriceLabs type systems — you have a crossroads cake, that is to say that if you you expect something that writes you prices in boxes, it will write you prices in boxes, that's for sure. Afterwards, will you always get the best price at the best time? I have a few examples to give to alert you, because there are still quite a few situations in which the algorithms are not able to react correctly, and frankly, that's normal. We are in a situation where today, in the world of tourism, there is no big company, and even before covid, which does not work with an algorithm. Exclusively, they only have algorithms reworked by humans. So, let's keep in mind that if Marriott, if Club Med, if all these huge companies that do tourism, that have been doing accommodation for decades, today, despite the scale of their financial means do not only have an algorithm that is capable of doing the work, they also have analysts who come to look at what the systems are doing in order to be able to do something fairer and more correct, why is We, individual seasonal rental companies, could we have the means to finance a system that sets prices correctly? It doesn't make sense. In fact, what we are served is a crossroads cake. I can't say it any better than that. This is what we are served. It's kind of a mainstream thing, the crossroads cake. And so, we are told: “Here, have the crossroads cake. It will feed you. » Yes, it nourishes, but does it nourish well? Did I enjoy eating this cake at the intersection? That's another subject.
So, I'm going to explain four situations in which the pricing algorithm is too partial. The first is the algorithm you have, if you use PriceLabs or B-Pricing, it doesn't know how to look for events. However, events are one of the most important sources of growth in turnover for your activity. So, he won't know the events at all, and even worse, because we have a bit of baggage with the pricing algorithms, as he doesn't know that it was an event, he will tell you: "The weekend -end of March 3 and 4, last year, I saw that there was a lot of demand", and therefore, on March 3 and 4 of the following year, he will increase the prices . He's going to keep prices high, in fact, because he saw that a year before, on that weekend, there had been a lot of demand. Except that in fact, what the system doesn't know is that in the meantime, the date has changed. And I guarantee you that with covid, there are a lot of dates that have changed. And he, suddenly, well he doesn't know. So, it will leave you at an expensive price over this period, and ultimately, you will be empty, because too expensive over a weekend where nothing is happening. So these are really serious harms from this kind of delegation, delegation to the algorithm. Another misdeed of delegation to the algorithm is – wait… I noted a few points, and I can no longer reread it – changing behavior when there are atypical events. The pricing algorithm is not able, as we saw with covid, to react when there are events that are completely atypical. There with the covid, they did absolutely anything. And once again, we're not going to blame them. We explain situations to them, and the algorithm found itself faced with a situation that it did not know at all. Well he just doesn't know what to do. So, there you have it. This is the second point on the risk of delegating to an algorithm. The third point is that it is not capable of reacting to a small amount of data. It's statistics, so, in fact, the algorithm will wait until it has enough sales, enough trends, requests to confirm itself, and say: "There, that's it, I can make a decision, because that I have enough reservations. » So, at the beginning when these are the beginnings, the algorithm will not be able, in fact, to react immediately on prices. Whereas if you yourself have acquired skills on the subject, or you delegate to someone who knows, we often have a strong interest in reacting very quickly, because the faster we react, the more we manage to gain some tens of euros more on reservations, because we immediately saw the potential, we were able to diagnose why we already have reservations like that, even if it's just one or two. But we react, and immediately, it’s extra money. This is the third risk of delegating to a machine. And the fourth risk is that in fact, if your property does not react like the trend, these algorithms are enormously influenced by the overall trend, by what is happening in your city, what is happening on the area. If you have a property that doesn't react like the rest of the trend, and we've also seen that many times... What I'm talking to you about is not prejudice. Having seen the inside of the reactor of some of these tools, it is experience, that is to say that we, as experts, we react in a certain way, we will see in the system , and we wonder why the algorithm has not moved. So, to finish, the last point is that if your property does not work well, while the rest works, well the pricing algorithms react very late. They're really going to do it at the last minute, and worst of all, they wait until the last minute, and then they're going to cut your prices. It's a disaster, that kind of thing. So, there you have it, I have really told you the risks of delegating to a machine.
So what did I share in this video? The first thing is that preparation, as crucial as it is, is not enough. You have to know how to play the game afterwards, you have to know how to play the match, you have to know how to react. You can't be like a super well-dressed tennis player, but who doesn't know how to do either backhand or forehand, and who doesn't know the rules of tennis? Preparation is great, but it's not enough. Now, we must not mix “automation” and “delegation”. We really need to realize that in fact, in automation, there is no decision-making. As soon as there is something that requires decision-making, that requires arbitration, it is not automation that we are talking about, it is delegation. And on delegation, you have three options: delegate to a machine, delegate to an expert, or trust yourself, and increase your skills on the subject. For delegation to a machine, once again, I don't blame this tool, but all the same, you have to keep in mind that there are plenty of things that will be done poorly. Afterwards, it is up to everyone to make their decision as a business leader: do I prefer to say to myself too bad, there are lots of things that will be done badly, too bad, I will miss out on money, but I take it anyway, or otherwise, I hope for real profitability, I hope for a truly professional project, and in which case, I do not turn to these pricing algorithms. So, on pricing algorithms, as I told you, there are plenty of situations that will not be anticipated by the algorithm, if there are events, it will not cope, if there are has events that shift, if something atypical happens, the algorithm does not know how to manage it at all, if your property operates against the general trend, it will not ride the risk or the opportunity, so it's not going to move in the right direction. And the last thing is that with a low number of data, the system does not know how to react immediately. So the same thing, we waste time, and when we waste time, we lose money. So, those are the three points I wanted to share with you.
Now, obviously, I'm not going to leave you like that. What is the solution? In fact, for me, the solution, if you have the means to delegate, is sure to be royal. There's nothing like it when you're a business owner. And I also speak for myself, it's really important to tell myself that I work with people who are excellent in their profession, who have this expertise, and don't do things by halves. We work with people of excellence. To me, this is the best way to run things as a business owner. Once again, it's up for debate, everyone sees noon at their door. But you can absolutely, and it's understandable, especially when you're starting out, say to yourself: “I'm going to improve my skills on this subject myself. » So on that, we can say to ourselves, at the beginning: “It’s going to take me time, it’s going to be hell, it’s going to be complicated, I’m not going to make it.” » In fact, when you train, if you choose the person who will train you carefully, it's simple. These are step-by-step methods, we give you the tools on a plate, and how to set it all up. Afterwards, you just have to do and practice. When you have a tennis coach, it's the same. At the beginning, it seems like a whole world, we are there with the racket, we are struggling, we are having difficulties. Except that in fact, if someone takes the time to explain to us: you have the backhand, you have the forehand, these are the rules, this is how you must react; In fact, it's just a matter of practicing a little. But it's much simpler and much faster than not training. So for me, if you're just starting out, this is definitely the best solution. Watch this video again to really become aware of how price will determine the performance of your project, to see what is the best scenario for you on how to delegate this subject, if you have this desire, as they say, to 'automate, even if I don't like that word. I wanted to explain why, to me, it is wrong, in fact. See how you are going to delegate this subject, and trust yourself, train yourself, and you will see that you will have brilliant results. We see it every day with our customers. There are very good results.
If you want to start learning, I'm sharing with you that we're doing an incredible webinar this week that we worked hard on, in which we bring together all the methods to double the profitability of your business, double the profitability of your property. I'll be the one doing it in person, so I'll be happy to see you there. I will answer all the questions you have, I will share with you in complete transparency the methods that allow us to – I was going to say explode, but that is a bit presumptuous – really significantly increase turnover and profitability. property of the clients with whom we work. We have some very good examples that I will share. So. Register, the link is just below. I would really enjoy meeting you again. I hope you like this topic, I hope it will help you understand this misunderstanding that there is, in my opinion, usually about the automation of short-term rentals. As usual, I make one video per day from Sunday to Thursday, so listen, I'm looking forward to seeing you tomorrow for a new video. Take care of yourself and see you tomorrow.