chart of ADR

How to Increase Your Vacation Rental’s Average Daily Rate (ADR) in Bali

img Adiel Ananda | January 13, 2023

Bali is a popular destination for travelers from all over the world, and vacation rentals in Bali can be a great way to earn extra income. However, to maximize your revenue, it’s important to have a high average daily rate (ADR) for your rental property.

As a marketer at Bukit Vista, a property manager in Bali for 140+ properties. I know firsthand from my experience that the Average Daily Rate is one of the top KPIs to measure the operating performance of your vacation rental. But, why is it important and how do you increase it?

What is the Average Daily Rate (ADR)

The Average Daily Rate (ADR) is a commonly used indicator in the hospitality field that represents the typical revenue generated per occupied room on a specific day. ADR demonstrates the average income per room.

A higher ADR is preferable as it suggests that a rental property is earning more money from renting out rooms. An upward trend in ADR indicates that the rental property is becoming more profitable.

Calculating the Average Daily Rate (ADR)

Average Daily Rate = Rooms Revenue Earned / Number of Rooms Sold

Example: If a property has $1,000 in room revenue and 10 rooms sold, the ADR would be $100 ($1,000/10). Rooms used for in-house use, such as those set aside for hotel employees and complimentary ones, are excluded from the calculation.

graphic on increase earnings
Source: Freepik

How do you increse Average Daily Rate

The travel industry is constantly evolving and to stay competitive, you must be proactive in finding new ways to boost your bookings. This can be achieved by continually enhancing different areas of your business. Here are six strategies to enhance your Average Daily Rate and help your vacation rental prosper:

  1. Optimize your listing: Make sure your listing is accurate and up-to-date, with high-quality photos and detailed descriptions of the property. This will help attract higher-paying guests.

  2. Set the right price: Research similar properties in the area and set your price accordingly. Make sure it’s competitive but still allows for a good profit margin.

  3. Improve the property: Invest in upgrades and renovations to make the property more appealing to guests. This can include things like new furniture, appliances, or even a pool or spa.

  4. Offer additional services: Provide guests with extra amenities, such as airport transportation, daily housekeeping, or even a private chef. These added services can increase your ADR.

  5. Utilize peak season: Be aware of peak seasons and adjust your prices accordingly. During these times, you can charge a higher rate for your rental property.

  6. Make use of online travel agencies (OTAs) : By listing your rental property on popular OTAs like Airbnb, Booking.com, and Expedia, you can reach a larger audience and potentially increase your ADR.

Bukit Vista team doing revenue projection for managed properties
Bukit Vista offers dynamic pricing for higher ADR

As you read above, increasing your ADR is no easy task. If you want a hassle-free way to increase your ADR just contact us.
Bukit Vista can help increase the Average Daily Rate (ADR) for rental properties in Bali by conducting dynamic pricing strategy a to adjust pricing accordingly to ensure that the property is competitively priced. And enhance the property’s online presence by optimizing the listing, creating professional quality photos and descriptions, and listing the property on popular online travel agencies (OTAs) such as Airbnb and Booking.com.

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