Summary:
- One quarter of all bookings will be last-minute: 25% of all bookings for Labor Day Weekend will be made within one week of arrival day, an increase of 6% since 2021.
- Slight increase in Labor Day ADR: ADR has increased by 16% ($45) since 2021 and has risen slightly above last year’s ADR of $328 to $329.
- Direct bookings for longer stays: 57% of all bookings for stays of 8 days or more surrounding Labor Day Weekend have been made directly.
- Airbnb, the booking platform of choice: 47% of all Labor Day Weekend bookings will be made through Airbnb.
Labor Day Weekend, a celebrated occasion in the United States that pays homage to the contributions of the workforce, is not only a time for reflection and appreciation but also a time for leisure and travel. As the summer season bids farewell and fall begins to unfold, this long weekend provides the perfect opportunity for people to escape their daily routines and enjoy memorable getaways.
In this industry report, we delve into the intriguing insights of Labor Day Weekend 2023 (September 2-4, 2023). By examining key factors such as average daily rate (ADR), average length of stay (ALOS), and direct vs. third-party bookings, we aim to provide vacation rental owners, property managers, and industry stakeholders with valuable data to make informed decisions and offer exceptional experiences to their guests.
Don’t see the form to download the Direct Bookings Guide? Click here.
When is Labor Day Weekend?
Labor Day is celebrated on the first Monday in September and is a federal holiday in the United States. The three-day weekend it falls on is referred to as Labor Day Weekend.
For the purpose of this report, Labor Day Weekend 2021 is based on data for the dates of September 4-6, 2021, Labor Day Weekend 2022 is September 3-5, 2022, and Labor Day Weekend 2023 is September 2-4, 2023.
Furthermore, when analyzing the average length of stay (ALOS), we are taking into account all bookings with an arrival date that falls on any day during Labor Day Weekend.
One quarter of all bookings will be last-minute
Are you currently glancing at your calendar and wondering why it hasn’t filled up yet? Well, there’s no need to panic. Time is still on your side!
If we consider a booking made within one week of arrival as a last-minute booking, then the rate of last-minute bookings has increased each year for the last two years. In 2021, 19% of all bookings were made within a week of arrival; however, this year, we are expecting at least a quarter of all Labor Day bookings—be it direct or through OTAs—to be last-minute.
Why are people procrastinating when it comes to booking?
Many guests are waiting until the eleventh hour to hit that ‘book now’ button. It could be part of a strategy where they’re betting on better options or maybe even a price drop as Labor Day gets closer. Furthermore, by holding off, they’ll be able to pounce on any unexpected deals or discounts that pop up.
How can I make the most of this strategy?
Being able to accept last-minute bookings is about being prepared, flexible, and adaptable. Ensure your listings are connected through your channel manager so all of your booking data is updated in real time. This will allow you to accept bookings from either of your channels without risking being double booked.
Furthermore, you could offer an early-bird rate or incentive. For example, if a guest books before a certain date for a certain holiday or event, then they would get 10% off the total price or a free meal/surf lesson/massage/etc., depending on your vacation rental’s offerings.
Integrating automated cleaning, check-in, and guest messaging solutions into your PMS will also make sure that your properties are thoroughly cleaned and that communication, including responding to guest queries and doubts, is as efficient as possible.
Bonus tip: Check out the article ‘How to Prepare Your Vacation Rental for Last-Minute Bookings’ for more ways to maximize profitability.
Analyzing the uptick in Labor Day ADR
There was a significant jump in the average daily rate from 2021 to 2022, as ADR increased by 16%— or $45. Now we’ve seen it increase again this year, but only ever so slightly, from $328 in 2022 to $329 in 2023.
However, we can see that the ADR offered by OTAs for Labor Day Weekend has stayed pretty much the same compared to last year, while the ADR for direct bookings has steadily increased from 2022. Despite this, direct bookings are still considerably cheaper per day when compared to OTAs.
One of the reasons that could explain this price difference is the third-party commissions and fees that hosts and PMs have to pay on booking channels. In order to compensate for this added cost, they can increase their rates on OTAs, which helps them to maximize their booking revenue during this time.
Why the surge in Labor Day ADR?
The increase in average daily rates could be attributed to the supply and demand dynamics. As the demand for vacation rentals during Labor Day Weekend remains robust, the desirability of vacation rentals, particularly in sought-after destinations, often leads to increased competition among travelers, thereby contributing to a modest elevation in average daily rates.
Additionally, many vacation rental hosts continually invest in enhancing guest experiences by offering upgraded amenities, improved property maintenance, and personalized services. These additions can justify an increase in average daily rates, reflecting the added value and higher quality of stay.
How can I turn this rise into an opportunity?
Try creating attractive package offerings that bundle amenities or experiences with the increased rate. This could include complimentary services such as airport transfers, guided tours, or access to local attractions. Bundling amenities can make the increased rate more appealing to potential guests.
Alternatively, you could market your property’s unique selling point and emphasize that guests will be paying for a special experience that is tailored just to them. By focusing your marketing on a targeted customer segment, you will be connecting your rental with potential guests who will value the experience on offer and, therefore, more willing to pay a higher rate.
Direct bookings for longer stays
As mentioned above, when looking at the average length of stay, we’re referring to any booking with an arrival date during Labor Day Weekend, regardless of duration. This is because many guests take advantage of the long weekend by using it to enjoy an even longer vacation.
This year, we can see that guests are significantly more inclined to use an OTA to book a stay of 7 days or less. On the contrary, 57% of all bookings for stays of 8 days or more have been made directly.
Why do guests choose direct bookings for extended stays?
Guests can avoid paying a higher rate because OTA bookings are generally more expensive. By opting to make their reservations directly with the property owner, they can save a significant amount when booking longer, more expensive stays.
Another compelling reason for guests to prefer direct bookings for longer stays is the opportunity to establish a personal connection with the owner through direct communication. This communication fosters a sense of trust and confidence when parting with their money.
In addition, some hosts may be more willing or more flexible to accommodate unique requests and provide free add-ons for direct booking customers.
Seeking to attract long-stay reservations? Focus on direct channels!
To attract those sought-after extended stay bookings, consider dedicating resources to optimize your direct booking platforms. Potential guests have likely already committed to a getaway this Labor Day and are actively seeking a trustworthy destination—and host.
Take advantage of your Property Management System (PMS) by implementing tailored automated messaging solutions. These systems ensure swift and effective responses to guest inquiries, enabling you to provide exceptional service and address potential concerns promptly. Speedy and detailed replies will fill your potential guests with confidence. It’s worth noting that guests may be happier to spend a bit more if they are confident they are making the right choice.
Airbnb, the booking platform of choice
As we predicted in our Summer Industry Report, Airbnb is the booking platform of choice for this year’s Labor Day Weekend, with nearly half (47%) of all bookings expected to come through Airbnb.
The second most common source is direct booking channels, which make up 38% of all Labor Day Weekend 2023 bookings.
Maximizing spontaneity: Why is Airbnb attracting so many last-minute bookings?
When looking at the average length of all stays over Labor Day Weekend, we can see that it’s 3.75 days so far for this year. When taking into account the fact that OTA bookings are more common for shorter stays, it’s not surprising that Airbnb is so popular.
This is because the amount of last-minute bookings has increased year-over-year, and Airbnb is the most popular platform for last-minute bookings. On top of that, Airbnb’s user-friendly platform allows travelers to explore and compare a wide range of options in their desired holiday destination.
Make the most of both booking channels
While Airbnb’s share of Labor Day Weekend bookings has expanded compared to previous years, it remains important not to disregard the significance of direct bookings. These direct reservations continue to provide a stream of bookings that should not be neglected. To optimize your revenue potential during the Labor Day period, a dual-channel approach should be embraced.
Connect your direct booking website with Airbnb through your PMS’ channel manager to synchronize your bookings, calendars, and rates. Not only will this help you to maximize your bookings, but it’ll also help you avoid double bookings.
Key takeaways
Our data has revealed a subtle uptick in Labor Day ADR and the potential for hosts to maximize their revenue during this peak period. Notably, our findings highlight that while OTAs remain a popular avenue for bookings, guests recognize the value of direct bookings, especially for longer stays. Not only does this approach prove to be more cost-effective for them, but it also presents an opportunity for hosts aiming to maximize longer stays.
Furthermore, we’re seeing that last-minute bookings are growing year-over-year, so hosts should equip themselves with the tools to adapt to this trend and be as flexible as possible to welcome guests on short notice. In addition, it’s the perfect time to optimize and revamp your Airbnb listing for Labor Day and ensure it is synchronized and connected to all of your other listings, including direct channels, through a reliable PMS and channel manager.
By embracing the power of direct bookings, recognizing the allure of extended stays, adapting to spontaneous bookings, harnessing the reach of Airbnb, and leveraging the uniqueness of vacation rentals, hosts will be fully prepared to ensure that Labor Day Weekend 2023 is a huge success.
Don’t see the form to download the Direct Bookings Guide? Click here.
Methodology: How we created this report
We’ve analyzed more than 160,000 bookings within Lodgify’s internal data, including direct and OTA bookings. All bookings were made for properties in the U.S. with arrival dates that fall on Labor Day Weekend 2021, 2022, and 2023. We also combined this data with specialized software to make forecasts based on current and previous trends.
For statistical purposes, we’ve also filtered out outliers that would have impacted the final results.
