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Episode 062 – Making Bank and Serving: the Fine Line Between the Two

 

 

SHOW NOTES & LESSONS

 

Walking the fine line between $$$ & Service

 

Not Making Enough? Check the Basics:

    • Professional pictures with the best in front?
    • Great Listing Headline that highlights your Best Features?
    • Dynamic Pricing and Good Reviews? 

 

Think about what your Ideal Guest wants or needs. Why are they there? What things might they want to do? How can you make it better - or special - or add to their experience - or create special

 

moments that they'll cherish forever? SERVICE! 

 

You can charge for early check-ins or late check-outs when you are able. You can charge to hold luggage. You can charge for upgrades - better quality, like strollers. You can charge for laundry or maid service. You can charge to pre-stock grocery items or breakfast or pretty much anything you can think of.

 

Send your guest questionnaires before and after stays to help.

 

WHAT BOOKS, PRODUCTS, SERVICES, OR LINKS WERE MENTIONED...

Please use our Affiliate Links whenever possible and help support the show.  Thank you!

Recommended Article or Blog Post Related to This Week's Podcast:

How to Make Your Vacation Rentals Family Friendly

 

Recommended Podcast Episode that is paired with this one like a Fine Wine:

Episode 043 – What is an Airbnb Experience & How You Can Get in on Them

 

Get This Episode's Show Notes in a pdf form...

Go To Our Download Page 

Show Transcript

[00:01] Over the last two centuries, nearly 90 percent of the world's millionaires have created their wealth through real estate. Here to tell you how you can ride this wave with less risk and less capital while creating greater income, is your host, best selling author and Speaker, Michelle Russell.

[00:21] Hi, this is Michelle, the Master of Money Mindset, and you are listening to the Short Term Rental Revenue Podcast...

and in today's episode, we are going to talk about making bank or serving people the fine line. But before we do, I want to remind you that today's show is brought to you by audible. You can get your first audiobook for free by going to audible trial.com forward slash S T R revenue. That's audible, trial.com forward slash S T R revenue. You'll get your first book free and 30 days of trial. Right now I'm reading a bunch of really good books. Dave Asprey's new book came out and I am right in the middle of that. And Holy cow, it's amazing. But I've actually bought like four books this week that I really want to get to and I'm so super excited because we're going to be traveling again going out to new Orleans, going on the crew of boo there.

Speaker 1: (01:15)
And so I've got a lot of travel time, some air time, some lay over time, which means that's time for me to listen to books. So I put a bunch of books on my phone app and make sure that I can fast forward them and listen to them really quickly and have my husband make fun of me like he does. So that's my goal in the next couple of weeks to get through all those books and see what happens. Let's get back to talking about making bank versus serving people. Everyone and their mother wants to know how the hell to increase their income on their B and BS. And we've had podcasts about it and we've had articles about it and there's articles everywhere about how to increase your revenue. There are some tips and tricks that other people use. They up their nightly rate or sometimes they don't even up their nightly rate.

Speaker 1: (02:03)
They keep it like everyone else in up their cleaning fees. There's a lot of different ways to do this, but it's not just the money, it's the service guys. And I want you to realize that and know that. And so I put together some examples to help you to recognize where that line is. Okay. So I don't know if any of you have seen the movie, the founder, about Ray crock, who is, well, they say he's the founder, but he wasn't the founder founder. He wasn't the inventor of McDonald's, but he definitely took McDonald's to where it is. He took the McDonald brothers idea and kind of went crazy with it. But when you watch that film, it's pretty cool because it does show you the difference between making bank and serving people. Whereas the McDonald's brothers were constantly asking themselves, how could they make it better?

Speaker 1: (02:55)
How could they serve more people and in a better way? Do you hear those questions that they were asking themselves? That's a tip. When they were asking themselves those questions, they were coming up with all these ingenious ways to make their product faster, to serve it to their customers quicker so that they didn't have to wait and to keep the quality and maintain the quality of the product. Now, when Ray crock got in there, he had a different question in his head, correct? His question wasn't, how can I serve more people? His question was how can I make bank on this? How can I make more money off of this idea? And that was his focus. And a lot of times businesses focus on making bank and that's all they focus on. How can we make more money? They have to have that fine line between how can they serve more people and serve them better and make more money, right?

Speaker 1: (03:53)
Because obviously as a business, your job is to make money. That's why you're in business. So you can make money if you're doing this, not for money and just for extra money or because you really love hosting and you want to share your home and meet new people, that's well and good. But the majority of people who do a, B and B or who do a short term rental do it to make money and it might be just to help out with money or it might be their main source of income. So you have to think of your primary questions. Are you trying to make bank or are you trying to serve people and where is that line? Because that is where the rubber meets the road. The great companies focus on serving people and they focus on serving them better and then they focus on serving them in a way that saves them more money, saves them more time or does something for them, but in the way of doing that, they make more money or make money not by an accident, but definitely almost as a benefit.

Speaker 1: (04:55)
Correct. Just like an for a bonus. Here you go, you get to make some money on top of that. That's where you should be thinking because as owners of a short term rental business, and I've said this before a bunch of times on here, you have to remember you are in the service industry. You are hosting people who are coming for a vacation or for business or for whatever reason they are coming to your properties. You are there to serve them and this is not the same as a residential real estate business where you're just providing a space. People are demanding more and more a service from you and you have to remember that and you have to give more, so you need to, if you're not making enough money right now, focus on serving. What else can you do to add value to your product or service?

Speaker 1: (05:51)
Right? Those are the questions that you need to be asking yourself. Focus on your people. First, focus on your customers, your clients, your guests. Focus on them first and then the money will come to you as an added benefit. What else can you do to serve them? Now think about this. Everybody who does any type of business is selling something. They all are selling something and if they try to tell you they're not, they're liars because even doctors are selling good health. They want you to stop smoking. They want you to eat right. Why? Because they're selling you good health. They want you to take up those habits, those healthy habits so that you don't get sick, so they don't have to give you all the medication that they would give you. Correct. Everybody is selling something. Every religion sells something. Every business sells something.

Speaker 1: (06:42)
Every person who's out there is really selling an idea and they do it for a reason. Now you've got to know the reason behind it before you invest in it. Correct. There's people who come to your door and knock on your door and they're like, Oh, we're selling bugs sprays today. We're in the neighborhood and we're competing against Terminex and we're the new guy and we're so much better because we do it once a month instead of every two months. Or we use all natural chemicals. Whatever they're doing, they're going to tell you the benefits. But the whole reason they're there is what to get more clients to benefit them. But they have to give you a benefit in service in order for you to buy the product. So it's easy to see that fine line is there the line where they want to make more money and get more business and the line where they want to serve you.

Speaker 1: (07:35)
Nobody would do those things unless there was some kind of benefit. Now sometimes it's a benefit spiritually or it has some kind of something that makes them feel better about themselves and about their lives. It gives them a purpose. It could be that, but whatever it is, there's that line, that fine line between what they're going to do for you and what they're getting out of it. Correct. So you have to find your fine line. A lot of times we have forgotten that we're in this service industry and our fine line has disappeared and it's turned into, I just want to make bank. How can I make more money? I need more money. I'm gonna make more money. And I get that. I totally get that. Especially doing a podcast now, I made a lot more money just doing real estate and doing my real estate investing and flipping houses with a lot less effort.

Speaker 1: (08:25)
I didn't have to try as hard. Correct, but here's the deal. What was my purpose? My purpose was to help other people learn how to do it because I didn't want people to struggle or I didn't even want to hear any of the bitching anymore of people going, well I can't. I don't have the same opportunities that you do or I wasn't raised that way and you're like, people, people, people really, my parents didn't have any money and especially my mom, once my parents got divorced, I mean we were on food stamps, you name it. It's not opportunity that comes knocking at your door. You have to go looking and then opportunity will knock, so you have to get yourself out there and everybody has the same opportunities. So I was tired of listening to people, give their excuses of why it wasn't going to work for them.

Speaker 1: (09:14)
When you can see every single day people coming into our country and building the American dream. First and second generations who are living in the United States do better than almost anyone else. Why? Because they have that American dream. They have that drive, they have the ambition and the will and then they put action to it and they do it. They don't let anything get in their way, so you need to do the same thing when it comes to this. Stop thinking about making bank. Start thinking about serving people. Lean more to that side. What can I do to make their experience better? Staying in my BNB, what can I do to add value and then attach a monetary value to that service or that product or whatever you're doing. So maybe people need earlier check-ins. Let them check in earlier. If you possibly can, charge them for it.

Speaker 1: (10:12)
Let them check out later. Charge them for it. Maybe they need laundry service. Find a laundry service company that charges you, maybe $10 a load. Charge them for it. Find a service they want breakfast every day. Great. There's this wonderful little restaurant in Tucson that I love going to, actually, I think it's a chain, but I don't think it's a public offered chained, but it's called beyond bread and it's a little bakery in Tucson and they've got a few locations and there's a couple down by our properties by the U of a. I love going there for lunch. They have like a Friday special. But what's really cool is you can get door dash to deliver their food for you. So what I can do is I can have them create a bagel breakfast tray or some kind of muffins and baked goods, maybe some fresh fruit and juice on the side and then charge somebody $25 for that breakfast and they have it delivered right to them every morning.

Speaker 1: (11:13)
Do you see, think about the things that they need that they want. You have to know your client really well before you can start thinking about and creating these ideas. So being close to a university, which most of our properties are in Arizona, or being close to a theme park, which most of our properties are in Florida or being close to a beach. Those things all have different types of guests who are going to stay there with different types of needs. So let's think about the parents who are coming into Florida and they're renting our places. What do they have? Most of them have kids. And what is a pain in the ass to bring with you on a plane? Strollers. Hello there. Our stroller renting facilities all around Orlando because people come in and they need strollers just for that time period or car seats just for that time period or cribs just for that time period.

Speaker 1: (12:17)
So a lot of people when they have a house like that, they offer the cribs and all that stuff and they don't charge farm and you don't have to, but most people will offer like a standard version of a stroller, but you can have an upgrade. So let's say they want something nicer. You can say, Hey, we'll upgrade your stroller for your stay for this much, and then you make a deal with the local stroller rental places or you go invest in one because strollers are a few hundred dollars. Even the really, really nice ones. So it depends on what you want to do, but don't just give away everything, give away the basic and then upgrade it. You can even start with food packages. So when people get there, especially when they get in late and it took them a while to get there, you might say, Hey, if you would like just give us your shopping list of items you'd like to have and we'll provide your food.

Speaker 1: (13:13)
Put that in there for you to get you started and you won't have to go shopping right away and then just charge an extra 10 15 bucks for it. So go shopping for those items and then just add a service fee to that. Do all the things that you think that they need. So our properties that are closer to the university, what do we get a lot of? We get a lot of parents visiting their kids. We get a lot of university people. Sometimes they're speaking, sometimes they're doing some kind of dissertation. Some times they're doing some kind of research. Whatever they're doing, they're going to the university for it, so they'll usually tell us too, because we've got that little question and it says, what time will you be arriving? You can ask any little questions and it automatically gets sent to them when they make their Instabook.

Speaker 1: (14:01)
Right. Everybody, I mean 99.9% of the people who get this question will answer back and tell us, I'm visiting my son. What do they need? They just need to know where all the local stuff is. If they want to use your kitchen and they want to bake or something, let them know. Say, Hey look, are you looking to make a homemade meal for your kid or are you planning on eating out all the time? If you are, let us know. We'll be happy to set up the kitchen with whatever you need and they'll give you a list. Maybe they have like a thing that they really love to cook for their kids. What about laundry? Especially with short stays. The kids don't have any laundry and they're like, gosh, you know what I'd really like is to use your laundry facilities, but I see that you only offer them on short sales.

Speaker 1: (14:46)
And it's like, Oh sure. For an extra $10 we'll open the laundry service for you and we'll even throw in a couple of tide pods to get you started. And there's two baskets. Just give them something that they need, right? Something that is fun for them to do in the area when they're with their kids because they don't know the area. And chances are if they're coming from a different state, their kid came from a different state and doesn't know anything but what the local kids have taught them or the kids at school there. So give them those ideas. What you have to do is learn to provide a service and ask yourself a lot of questions. What are they looking for? So a lot of times when you're having a group of relatives coming in, they are coming from all these different areas and they'll meet up in Florida if you have a reunion type thing, maybe they all want matching shirts.

Speaker 1: (15:40)
Maybe you know a local guy who can create matching shirts for them and they would love that. What can you offer those types of people? You can offer them shirts, you can offer them things that are going to make their vacation special. Things that are going to create family memories, right? So maybe a photo and maybe you can get a deal on them. Think of what you can do to make their stay special, unique and create a family memory for them. And the same with the beach beaches or easy water. Things are easy because people love kayaks, they love surfboards, they love paddleboards, they love all the sand buckets and things like that. Those things are great and easy and actually you can charge extra. You can say that these are available at an extra charge. They don't know if they're yours or if there's somebody else's coming in.

Speaker 1: (16:33)
Just say, what do you want in advance? We will have it there waiting for you and let them know. All of these things can provide a service and make you extra money in the meantime, but you never want to get to a place where you're just trying to make money and you're forgetting about serving people because there is that fine line. The more you serve, the better you serve, the more money you make. What it comes down to basically is if you really want to raise your income on your short term rentals, you have to think out of the box and you have to serve your guests better. You just have to be a better host. So go back to the basics first and make sure you're checking all those things and we have a whole episode about that. But basically check your pictures. Make sure your pictures are quality pictures that they were taken by a professional check and make sure that you have a great listing name.

Speaker 1: (17:29)
Your name should talk about some attributes that your property has. So if you have a pool or a mountain view, it should say something like that. It should say mountain view home or it should say, you know, relaxed by the pool or something. Something that focuses on a unique attribute that your home in that area, make sure you're getting good reviews and set up those five star reviews. We talked about that in an episode that constantly throughout our communication with our guests, we are constantly setting ourselves up for five star reviews. So in all our automated messages, and we have about five automated messages that go out to people in all those automated messages, we mentioned five star reviews, we set it up, four or five star reviews. So don't ever forget that. And then let's think about what our guests want. And I hate to just focus on the ones I know, but I'm just giving you examples.

Speaker 1: (18:30)
So if you want to write us a letter in Facebook and tell us, Hey, what about my property? I'm here, help me out. Definitely do that. Shoot us a message and we'll do our best to get to you. And probably put it on the show too because chances are no properties are unique in their areas, but I'm going to give you examples of what I know so I know beach front, I know Orlando, I know the hospitals and the traveling business people, the people going to the schools and I know students and I know the parents visiting the students. Those are the things I specialize in. You should have something you specialize in and when you do, you become the go to person. For those types of guests, become a person who knows exactly what those type of guests want and need. Ask them, ask them what they want, ask them what they need.

Speaker 1: (19:20)
There's no better way to find out. Then ask them. When you go to say the college towns, when you're in Tempe or something, you are always being asked about laundry service and cleaning services because even kids who are renting apartments, when their parents go to see them, they're like, Holy crap, my kid's place smells like a locker room. I don't even want to go in there. What I always do is recommend my cleaning service. I could actually book my cleaning service and then charge a fee for doing that. And it's the same with laundry. So maybe you can extend things out to be longterm services, figure something out. Just think out of the box. There are tons of people who need tons of things. You can provide those things. What about luggage? Storage? We get that a lot too. We get a lot of people coming in and if they can't check in right away they're like, where can I put my luggage?

Speaker 1: (20:19)
And that's really hard with BnBs hotels, they have a nice room in the back where they can lock everything. But if you can figure out a way, you can have some kind of luggage. Storage service doesn't even have to be necessarily on your property. It can be close by just something somewhere and use tech because people love tech. There's a service called your welcome. It's not, you are welcome at your welcome while you are just why are you are welcome and they give you these iPad things that go to your house and you can put all the local stuff in there for your people. And they charge you per month. They're amazing. And people love that techie stuff. So if you're in a place where people love more techie stuff, I think the beach properties are better for those not the family properties because your sweat happens.

Speaker 1: (21:14)
No offense to the people with families. I had five kids, I raised five kids, and believe me, I know the crap kids can do, but if you got a lot of kids in the property, you don't want a lot of techie stuff because techie stuff is expensive and it gets broken and kids can figure out a way to break almost anything. And it seems no offense to parents on vacation because I have been apparent on vacation and you just finally want to sit and relax, but they're not watching their kids all that well. So a lot of things do tend to get broken when appearance on vacation because they're letting their kids kind of run a little more wild than they would normally let them run. No events to the parents, no offense to the kids. It's just the way things are. So in those types of units, I don't put more techie things.

Speaker 1: (22:02)
You know, as techie as I would get would be a remote control to a TV. That's as tech as you're going to get. I know kids are going to be in that property, right? But when I know there are going to be adults traveling without kids, then I go tech because people love that stuff. They love to try out stuff, especially couples, especially young couples. Young couples love those little your welcomes. They think that they're the coolest thing and they have all kinds of things that we offer on them. So do that. Now we also talked about in one of our previous episodes offering what offering insurance offer your people travel insurance guys. There are sites out there like Pablo who will pay you to have people sign out for travel insurance. That way you can have a strict setting on all your bookings. Correct.

Speaker 1: (22:56)
And people can have travel insurance that will pay for any cancellations and you make a little bit of money on those travel benefits. So a lot of times that money adds up guest after guest after guest signing up for that. Yes, you'll make a lot of money. Remember when we were in the travel industry back in the day, cause you guys are probably all too young to even remember that there used to be no online book gains. No one had, no one had home computers. There never was anything like that. So everybody went to travel agencies to book their travel and we only got a 10% commission on almost everything, right? 10% of the hotels, 10% of the airlines just doing those things, offered a commission. Travel services are still out there and they're really great. I love using travel services, especially when I travel overseas.

Speaker 1: (23:53)
Why? Because it's a one stop shop. They booked my airfare, they book all my transfers, they book my bags, my hotels, my tours, all of that is booked in one place and they handed to me in a brochure and it's done for me. Are you kidding? I don't mind paying for that service. I love that service. And usually too. Those are going to be the people. They will be your best advocates if anything goes wrong. If anything gets AFT up, if any train is late, if any flight gets canceled, if any hotel is flooded, they will get you into another hotel. They will be the one who calls the airline, gets your money back. They will be the one. They will be your biggest advocate to get your money back for you than anyone else. When you use a travel service, anything goes wrong in the middle of your travel.

Speaker 1: (24:44)
Boom. You called them. They're like, I'm on it. That's why I love American express. American express is not just a credit card and most people don't realize that American express has an amazing service platform behind it. Those people are fantastic. People have lost their passports or had their passport stolen and who comes through for them. Not the American embassy, but American express, their credit card. They will do everything they can to get all the documents they need over to that person so that they can get home. They will make sure that they have money to get home money to pay for not just their lodging, but money to pay for their food and services while they are there. While they have nothing. American express is a great company and we need more advocates like that and what makes them special? What makes people like me not mind paying for those service fees every year is the fact that they have all those things I freaking love American express and I will pay for my card.

Speaker 1: (25:45)
I love shopping at Costco and I will pay for my membership. Why? Why do I not mind paying for it? Because I'm getting great service. Know that your guests won't mind paying for this stuff because they're getting great service. People don't mind. You might think, Oh no, this isn't worth it. I don't think it's worth it. People will get pissed, blah, blah, blah. The wrong type of people will, but your people, they won't. Are these your people? What do your people want? Ask them. Ask them. Make it your mission to find out and serve them and don't cross that line. Okay. Don't get too greedy about things. Definitely be on the side of serving, but definitely have your services paid for because it's worth it. It's your time, it's your money, it's your effort. You're doing a business and of course people are going to pay for it.

Speaker 1: (26:38)
I don't question the fact that I have to pay for a Costco membership. They're not going to be pissed at you for charging for laundry service to come in or an extra cleaning to come in for them. They're not going to be mad about that at all. They're actually going to appreciate it. Wow. That was really nice of them to offer that extra cleaning for us. That's great because they knew we had kids and we probably wouldn't have time to clean the sheets or or wash all the towels. Heck yes. They don't mind. They don't mind because when you're on vacation, you know things costs money because everything costs money. Time costs money. People don't just do things out of the kindness of their heart. There's always something in it. Even church people, right? There's always something in it because they want to go to heaven, so they're doing good so they can get somewhere.

Speaker 1: (27:28)
There's always something in it. People always have a motive and the motive is either something for them, a benefit for them, and usually it is, it's always a benefit for them, right? Even saving your soul is a benefit for someone who is in the job of saving souls, right? That's a benefit. They think it's going to take them somewhere, do something for them, whether it's true or not, nobody knows, but for them, they're doing it for a reason. There's always a motive. Make your motive be serving your customers, serving your guests. That's what your motive should be. Okay, I'm going to keep this one short and sweet this week because we've got another one coming up that's pretty darn good and I'm going to be traveling so I know again, right? But we're going into new Orleans for the crew of BU. I'm super excited about.

Speaker 1: (28:23)
I get to be on the head float and we're throwing now beads. My husband is way more excited than I am, but we have our mass and our costumes and we're all into the fun of the Halloween spirit. The Halloween spirit is here right by our house too. We are now in a town called queen Creek and for years and years we've had to drive out to a place called snips farm and they have a Halloween festival and the Halloween festival is super cool. They have pumpkin patches, they have bands, they have a fair, they have like, it's really crazy. Now. Guess what? You can monetize shit like that. Yes, you can. Yes, you can. If you had guests coming in, what if you had something that took them there? What if you had something that went along with that at Christmas time or on the 4th of July, maybe you had a dinner overlooking a Lake where fireworks went off. I mean, take what you've got and work with those things, right? Work with what you got, baby. That's why didn't your mom ever tell you that we need to work with what we got. So work with what you have. I want to wish you guys all the best. Hey, keep those five-star reviews coming in. I really appreciate them. God bless you. Have a great day. Go and grow.

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