Dynamic pricing may seem far removed from the world of songwriting, but there’s a surprising parallel. Today, AI tools have become so advanced that they can mimic creativity—generating text, analyzing data, and, yes, even attempting to write a Taylor Swift song. But while AI can capture patterns, it takes human expertise to fine-tune those results into something that truly resonates.
For short-term rental managers, the same principle applies to dynamic pricing. AI can help crunch data and spot trends, but to truly optimize revenue and lean out operations, you still need a personal touch—adjusting the tools and inputs to reflect the unique nuances of your market and properties.
In this article, we break down the key takeaways from a recent presentation by PriceLabs‘ Head of Product Marketing Thibault Masson at the Vacation Rental World Summit on AI-driven dynamic pricing strategies and explain how even smaller operators can use these tools to unlock profitability without losing control.
The Fundamentals of AI-Driven Dynamic Pricing
Dynamic pricing, powered by AI, is no longer reserved for the airline or hotel industries. It has become an indispensable tool for short-term rental managers who want to optimize their pricing in real-time, based on market fluctuations, demand, and property-specific data. But how exactly does it work?
1. Data Collection and Pattern Recognition AI starts by collecting a vast amount of data—everything from local demand patterns and competitor pricing to seasonality and even special events. Like a songwriter scanning for inspiration, AI tools scour the landscape for all the variables that can impact the price of a stay.
Just as Taylor Swift draws from her personal experiences and a world of emotions to write her iconic songs, AI systems like ChatGPT and PriceLabs rely on vast amounts of data.

This slide illustrates the data collection process.
2. Turning Data into Actionable Insights Once the data is in, AI uses algorithms to spot trends and make predictions. However, it doesn’t stop there. The AI not only recognizes patterns but adapts to them in real-time, adjusting prices to ensure that your listings remain competitive without sacrificing profitability.

This slide illustrated the pattern analysis process.
3. Personalization at Scale One of the standout features of dynamic pricing systems like PriceLabs and Beyond is that they allow you to input your own data—whether it’s specific local knowledge or property details that AI might miss. Much like how an artist adds their personal flair to a song, rental managers can tweak AI-powered tools to better reflect the unique characteristics of their properties.

This slide illustrates Dynamic Pricing usage for Single-property hosts.
This slide illustrates Dynamic Pricing usage for large portfolios.
Common Objections to AI and Dynamic Pricing
While the benefits of AI-driven dynamic pricing are clear, many short-term rental managers still hesitate to embrace these tools. Whether it’s concerns about losing control or skepticism about AI’s ability to handle unique properties, these objections can prevent operators from fully capitalizing on the technology. Let’s break down some of the most common concerns and how AI can actually address them.
1. “My property is unique—AI can’t understand that.” It’s a valid concern: every property has its own story, just like every great song has its own melody. However, AI tools are designed to be flexible. By allowing you to input your own property-specific data—like unique features, location advantages, or local market nuances—dynamic pricing tools ensure that your listing remains competitively priced without overlooking what makes it special.
2. “Everyone is using dynamic pricing, so it’s becoming less effective.” The reality is, just like in music, not all tools are created equal. While many hosts might adopt dynamic pricing, the key is in how you use it. AI doesn’t just automate prices; it helps you strategically adjust rates based on a range of factors. When you add your personal insights and fine-tune the settings, you gain a competitive edge, even in saturated markets.
3. “AI can’t predict everything—what about special circumstances?” Dynamic pricing tools are constantly learning and adapting based on real-time data. While they might not predict every one-off event (like a sudden, unexpected surge in demand), they’re programmed to adjust rapidly when such changes happen. That said, human oversight remains essential. You can always make manual adjustments, ensuring that AI helps you stay agile without losing full control.
Practical Applications for Rental Managers of All Sizes
Whether you’re managing a single property or a portfolio of hundreds, AI-driven dynamic pricing can provide solutions that are scalable to your needs. By leveraging these tools, you can unlock efficiency, drive profitability, and keep your operations lean without sacrificing control. Here’s how it breaks down based on portfolio size:
1. Single-Property Hosts: Play Like the Big Players For hosts managing one or a handful of properties, the idea of using sophisticated AI tools might seem overwhelming. But in reality, dynamic pricing helps you “play like the big players” by giving you access to market data that would otherwise be out of reach. Even a small-time host can benefit from AI’s ability to analyze local trends and demand, ensuring you’re never leaving money on the table. In essence, you’re turning data into dollars without the need for a full-time revenue management team.
2. Mid-Sized Hosts: Master Your Market If you’re managing between 5 and 50 properties, dynamic pricing allows you to optimize across a wider portfolio. AI tools help you balance demand while giving you the flexibility to tweak settings for individual properties. You can respond to market changes in real time, knowing that your portfolio is priced competitively but also with the right balance of occupancy and revenue. With AI, you can spend less time on manual adjustments and more time fine-tuning your broader strategy.
3. Large Portfolios: A Key to Efficiency For managers handling hundreds of properties, AI isn’t just helpful—it’s essential. As your portfolio grows, manual price setting becomes impossible to manage at scale. AI-driven dynamic pricing becomes your partner in ensuring that each property is optimized for revenue and occupancy. By using these tools, large operators can streamline operations, freeing up time for other strategic initiatives while keeping profits high. With advanced data inputs and personalized controls, you can manage a vast number of listings without losing the fine-tuned detail that each one requires.
Actionable Steps to Implement Dynamic Pricing Today
Now that we’ve covered the benefits, future trends, and real-world applications of AI-driven dynamic pricing, it’s time to look at how you can implement these strategies today.
1. Choose the Right Dynamic Pricing Tool The first step is selecting a dynamic pricing tool that fits your needs. PriceLabs, Beyond, and Wheelhouse are among the most popular platforms, each offering a range of features to suit different portfolio sizes. Start by exploring free trials or demos to see which one best aligns with your business model and goals.
2. Set Clear Objectives Before you dive into dynamic pricing, it’s essential to set clear objectives. Do you want to maximize occupancy, increase your average daily rate (ADR), or maintain a balance between the two? By defining your goals early on, you’ll be able to fine-tune your AI tool to help achieve those specific targets.
3. Input Your Own Data While AI tools can work wonders with market data, don’t forget to include your own insights. Add details that the AI might not catch—such as property-specific advantages, seasonal nuances, or upcoming local events. The more data you provide, the more personalized and effective the AI recommendations will be.
4. Monitor and Adjust Regularly Once your dynamic pricing system is up and running, make sure to monitor the results regularly. AI tools are designed to adapt to changing market conditions, but your ongoing involvement is still crucial. Check in to ensure the pricing aligns with your overall strategy and make adjustments as needed. Some fine-tuning may be required during the initial setup period.
5. Stay Agile and Experiment Dynamic pricing isn’t a set-it-and-forget-it tool—it’s an ongoing process that benefits from experimentation. Test different pricing strategies, adjust minimum stays, or apply discounts during off-peak times. Use the AI’s insights to inform your decisions, but don’t hesitate to experiment with different settings to see what works best for your properties.
6. Keep an Eye on the Future Finally, remember that the dynamic pricing landscape is evolving. Keep up with industry news, technological advancements, and updates from your pricing tool to ensure you’re always leveraging the latest capabilities. As AI becomes more advanced, staying informed will help you adapt and maintain a competitive edge in the market.