The Revenue Lever Most STR Operators Don’t Know They’re Ignoring

Jasper Ribbers
6/15/2026

I’ve been in vacation rentals since 2012. And after managing revenue across thousands of listings, I can tell you that about 95% of operators are leaving money on the table. 

The single biggest skill gap I see? Ignoring pacing. 

Many operators have heard the term and may have a loose idea of what it means, but very few actually use pacing to make pricing decisions. And that’s a problem, because it’s one of the best pricing clues you have.

Why Pacing Matters More Than You Think

Unfortunately, revenue management isn’t a hard science. We can’t calculate the optimal price the way you can solve a math equation. There are too many factors and too many unknowns. But pacing gives us the strongest signal available.

Pacing, as we primarily use it, is comparing your future occupancy to the market’s. Are you booking up faster than your competition, slower, or about the same? You measure this using the Market Penetration Index (MPI). The formula is straightforward: your forward occupancy divided by market occupancy.

So, if your portfolio is 30% booked for the next 90 days and the market is 60% booked, your MPI is 0.5 (50%). Your bookings are pacing at half the market’s rate. Whether that’s a problem or not depends on what season you’re heading into, which is where most people get confused.

The Booking Window Nobody’s Watching

To understand why pacing matters so much, you need to understand how bookings actually flow into a market. We like to think about it in three groups: early bookers, middle bookers, and last-minute bookers.

Early bookers are looking for a specific property. They’re families planning a reunion, groups booking for a college football game, or people celebrating a special occasion. These guests are the least price-sensitive. They’re willing to pay a premium.

The middle bookers make up the bulk of your reservations. They’re not chasing the cheapest deal, but they’re not splurging either. This is where most of your bookings happen.

Then you’ve got the last-minute bookers. You want some of these, but they should be the pepper on the steak, not the steak itself. They’re filling gaps, not driving the bulk of your revenue.

The big mistake we see constantly is operators ignoring large chunks of the booking window. They’re not really paying attention to how they’re priced six months from now, and they’re mainly focused on the next couple of weeks. So what happens? They miss the early bookers entirely. They miss most of the middle bookers. And by the time they realize, everyone else in the market is also dropping prices, and they’re now competing with rock-bottom pricing.

What Your MPI Target Should Actually Be

Once you know how to measure pacing, the next question is always: What’s a good MPI? And the answer changes depending on what season you’re heading into.

Going into high season, when you expect the market to reach 80%–100% occupancy, you can pace with the market or even slightly behind. An MPI of around 80%–100% is fine. Demand is strong, so you can afford to hold rates and capture premium bookings later in the booking window.

Going into the low season is completely different. If you expect final market occupancy around 30%–50%, you want your MPI well above 100%. I’m talking 150%, 200%, or even higher. If someone books your property for the entire month of January and your MPI shoots to 300%, that’s great. You want bookings. Low season is not the time to chase a rate. It’s time to chase occupancy.

There are two reasons. First, there simply aren’t enough bookings to go around in low season, so you want to capture as many as you can. Second, empty units lose online travel agency visibility. Airbnb rewards properties that are getting booked; an empty January makes it harder to get booked in June.

The general rule to remember: The lower you expect final market occupancy to be, the higher you want your MPI.

A Case Study That Shows What This Looks Like in Practice

We started working with a client earlier this year who was doing everything else reasonably well, but their pacing was way off heading into summer. They were significantly overpriced early in the booking window and had no idea because they weren’t tracking MPI.

When we compared year-over-year for the same units, the pattern was clear. In 2024, their average daily rate started above $400, and they weren’t getting any bookings. As the dates drew closer, they dropped prices drastically, triggering a rush of late bookings at much lower rates. 

This year, we came in with a lower starting price that was actually competitive in the early booking window. Bookings started flowing in around 90 days out. Early bookings improved OTA visibility, which drove more bookings even as we raised prices. By the end of the booking window, our prices were higher than the previous year’s panic-discounted rates, but occupancy was climbing faster.

The results: same occupancy, roughly 80% in both years, but RevPAR was up 35%. The difference came from one change: We doubled their effective booking window from about 16 days to about 32 days. We captured bookings across a wider window at healthier rates, rather than cramming everything into the last two weeks. Same occupancy, higher revenue.

Putting Pacing Into Practice

If you want to start using pacing, here’s the action plan we follow across all of our portfolios.

1. Set MPI targets by season. For each upcoming month, estimate the final market occupancy and set your MPI target accordingly. High expected occupancy means you should keep pace with the market. Low expected occupancy means you need to pace well ahead.

2. Track MPI and pickup weekly. Check your pacing numbers every week. But don’t look at MPI in isolation. Pair it with pickup, which is the number of bookings you’ve received in the last seven to 15 days. If your MPI is low, but you’ve had strong pickup recently, you’re trending in the right direction. You might not need to drop prices yet. If your MPI is low and pickup is also weak, that’s when you need to act.

One note on pickup: track the number of bookings, not revenue or booked nights. If one guest books a two-month stay, that will skew your numbers dramatically. A variety of individual bookings is a stronger pricing signal. 

3. Make small, intentional price changes. When you do need to adjust, change prices by about 5%–10%, not 30%. And do it once a week, not every day. If you’re constantly raising and lowering prices, it becomes impossible to tell what’s actually driving your results. Be intentional about where you make changes, too. If the next three months need lower prices but summer looks fine, adjust with seasonal profiles or use monthly overrides rather than dropping your base price, which would pull your summer rates down, too.

And before you lower any price, double-check that the issue is actually pricing. Maybe there’s a distribution problem. Maybe you got a bad review that’s hurting your conversion rate. Maybe your listing photos need updating. Not every pacing problem is strictly a price problem.

The Biggest Mistake Right Now

One thing I want to flag, because I see it constantly: Far-out premiums are hurting many operators in the current market. In 2021-2022, far-out premiums made sense because revenue was growing 10%–20% year over year, and pricing conservatively high was a reasonable hedge.

That market is over. We’re in a flat or slightly declining environment for most markets. If you’re still running a default 20% far-out premium, you’re probably overpricing in the early-booking window, which can push you into the last-minute trap we just talked about. Before adding those premiums, ask yourself: Is there a genuine reason to believe these future dates will command higher rates than comparable dates in the past? If not, you’re better off pricing competitively from the start and raising prices as demand is confirmed.

The Opportunity in Front of You

You just need to build the habit of looking at pacing and making decisions based on it, rather than reacting to your calendar two weeks before check-in.

Revenue management requires consistent attention. But the operators who put in the work (or partner with someone who does) are the ones who grow year over year, regardless of what the broader market does.

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