How to Calculate the Right Rate Lift for your OTA Rates

OTA's like Airbnb and Booking.com all charge a percentage of the booking as a commission.

HomHero gives you the option of lifting rates for each specific OTA in order to cover the commissions.

A common mistake is to just set the uplift to the OTA's commission percentage, but this will not cover the entire amount of the commission.

We'll explain why.

Say we have a booking total for a stay of $100.

Booking Total: $100

OTA will take 5.5% = $5.50

So what figure do we need so that when the OTA takes off their 5.5%, we still get our $100?

We can't just add 5.5% because this would make our booking total = 105.5 and then the OTA will take 5.5% of that figure which = $5.80

So we need to adjust the uplift to take into the account that the OTA will take their percentage of our total rate including uplift.

So if we instead use 5.82%, this makes the total booking = 105.82, then the OTA deducts their commission of 5.5% which is $5.82, which means that $100 is left over.

HomHero includes a reverse percentage uplift calculator on all Rate Lift fields, to make it easier to arrive at a percentage that will cover the inclusive percentage uplift.

If you need assistance on how to change your Rate Lift in HomHero for your OTA please see article here.