Did the booking (processing) fee for guests go up to 9.5%?
Thanks for the question. We recently introduced dynamic pricing for guest fees. It takes into account the subtotal price of the booking as well as other booking characteristics (generally, the higher the subtotal, the lower the fee). As before, guests will always see the exact fee amount prior to making payment.
For a bit of background, our team conducted a series of user interviews with many current and prospective guests at the end of 2018. We learned that the predictability of their Peerspace experience was of more concern than associated fees, which led us to kick off a few initiatives to raise the bar on our quality of service.
Following on from this research, we tested dynamic guest pricing on the site for several months. The test showed negligible impact to overall booking volume – increasing our confidence in investing more in the things that matter, notably: up-leveling the service we provide to our users and attracting even more high-quality business for our hosts.
As we continue to evolve this program over time, we will lean on feedback from our community to find the right balance of all of these factors.
Ok, thanks. Higher quality guests sounds great.
Hi Eric, what will the range be in service fees? In the name of keeping things simple and clear, it has been nice to be able to tell guests simply that Peerspace will add a 5% service fee to the total. I have had that discussion with a guest who is ready to book, and as I am preparing the custom quote, the service fee is now 8%. She is booking a full day now, and will book another full day by the end of the month.
But the fee has gone up, not down. So now after working out the details, they have changed.
Respectfully, this is a significant policy change and should have been presented to hosts in advance, along with a date the change would go into effect.
Brad- Thanks for your question.
The processing fee ranges from 1%-10% and the exact amount will always be detailed in the booking flow prior to the guest making payment. As a host, you’ll also see the exact amount when sending a guest a custom offer or adding overtime to a booking. I hope this provides the additional clarity you were hoping for, but please let me know how else I might help.
Fair feedback about not communicating the policy change ahead of time. We’ll do a better job in the future of previewing changes.
I just got a very positive feedback of Peerspace from a discerning guest, just to let you know. I think that it is good that Peerspace allows both high quality guests and also more regular profiled guests access to great spaces for their projects
Appreciate the info Eric, thanks.
This is an interesting note from Eric who states that the fee ranges from 1% - 10% but I just got a booking request and the indicated fee was 15%? What is the fee and what does it cover if it is 15%?
Alexandra_L- That doesn’t sound like the guest fee to me. We are not charging 15% to guests. If you happen to have a screen capture of what you saw that would be helpful. thanks!
I was confused by guest fees and host fees. no problem.
No worries. I’m glad you asked rather than wonder !
When I refer my personal clients to Peerspace I have been telling them what our hourly rate is and that there is an additional booking fee from Peerspace for 5%. Can you give us the price tiers so I can give them accurate information? I don’t want to tell them it’s 5% and then have them be surprised by a higher fee.
Eric, I often have to explain to my guests, who are bottom line oriented, that the final price will include a Peerspace guest charge that the host does not control, and they at times will imply that we should discount our rate to cover that. It’s then that I have to reveal to them that Peerspace charges the host even more than the guest, and they usually understand, so Peerspace does remove some of the friction from the process but not all of it. Thanks for being so open with us.
The processing fee now ranges from 1%-10% as @Eric stated in an earlier comment. It is calculated based on multiple factors, including the subtotal price of the booking and other booking characteristics. Generally, the higher the subtotal, the lower the fee. Guests always see the exact amount of the fee during the booking process.
If you ever want us to give you a proper quote of exactly what the guest will be paying for a booking that they’ve come to you directly for feel free to reach out to our Customer Experience team and we can give you an estimate.
Thanks Lawrence, I’ll touch base with you later.
Hi Lawrence- great to know we can get a quote. I had this issue just the other day and the guest fee (from Peerspace) was a moving target, per the client and I was not able to explain.
Exactly to which email should we write for a quote? And what other info do you need… the booking inquiry name and date?
Thanks so much!
Great question. You can shoot us an email at firstname.lastname@example.org or call 415-403-2421 from 9am-6pm PST. We just need to know the following info when you reach out:
- The name of the guest
- Booking date(s)
- Hours that the guest is booking
We can check the expected charge for that potential booking with this info. The guest will also always see the break down as well on the site when they go to book.
The only time it might be tricky for hosts or guests is when there is a custom booking but we can help with that as well usually if you tell us the amount you want to net from the booking, we can give a proper quote you can let the client know that would need to be charge in order to meet your minimum.
In my opinion, the new dynamic processing fee does more harm than good. For one, it is a mystery to everyone - hosts and guests - as to what this will actually come out to be. Uncertainty is never a good thing.
I’ve read here that the new guest fees are 1%-10%, however we’ve never seen the new guest fee be lower than 7% for our bookings and most come out to 8% or more. Where / when does a guest enjoy the 1% fee??
This is a significant increase over the previous 5% guest fee.
This appears to be more of a $ grab by Peerspace than motivated by any other factors.
We have already run into numerous situations with our guests who are ready to book and then are hit by sticker shock at the 8-9% additional fees on top. This has impacted our bookings directly and we have seen guests pass on our spaces as a result. We have also been put in an awkward situation where we are on the defensive and are squeezed into lowering our own fees to compensate guests to bring the total back closer to what our original negotiated offer was from the start. Further eroding our margins and profitability.
We are already paying 15% for referrals. With guests paying upwards of 10% on top of this appears to be a bit greedy from where we sit.
I don’t know if others share the same opinion but would certainly be curious to hear.
The old policy of a flat 5% made more sense to us, was consistent and predictable, and was easily explainable as a ‘processing fee’ when credit card processing is usually around 3.5% anyway.
Just my 2 cents…
Honestly, I am with Mark on this one. It was always easy to tell guests “Here is our fee, and Peerspace will add a 5% Service Fee.” It’s a nominal amount and not too off-putting to guests.
I am happy to pay the 15% of my quote as a fee for marketing my space, and it is great to have a larger company between me and the guests. My bookings are typically pretty straightforward and don’t require extra effort from Peerspace.
I have someone who occasionally refers clients to me, and he asks for a 30% referral fee. It’s too much. I will likely take the booking, but not be excited about it. Film location services take 30%, but those bookings are typically high dollar ($5 - 10K), so I don’t mind as much.
Having 20% of the total booking fee go to Peerspace is a reasonable pain point, it feels fair. And there is a lot of value in the simplicity and clarity in the straight 5% fee. The new “algorithm” unnecessarily complicates something that was very simple, “fixing” something that was not broken.
To secure more bookings, the most common advice I hear given to hosts is to lower their rate. Raising the service fee is contrary to this advice.