Today, as Expedia announced it is buying HomeAway for an estimated $3.9 billion, HomeAway also shook the vacation rental industry by announcing they are adding a traveler free to guests booking vacation rentals on HomeAway’s suite of online marketplaces.
Management Comments:
Brian Sharples, CEO, HomeAway: “Today we’re announcing business model changes, including the addition of a traveler service fee in mid-2016, which will dramatically change our ability to compete and thrive in the coming years,” says Brian Sharples, chief executive officer of HomeAway. “Better monetization will allow us to accelerate revenue growth, but most importantly will provide more resources for an even better product and service experience for our owners, property managers and travelers.” Mr. Sharples noted traveler service fee, which will be based on a sliding scale, will begin rolling out in Q2 of 2016 and is expected to add an average of roughly 6% to most transactions that run through its online shopping cart. In conjunction with the new traveler service fee, the Company plans to lower commission rates for most of their pay-per-booking customers and provide financial incentives to subscribers based on their annual booking volume through HomeAway’s platform.
Expedia Acquisition
Sharples continued, “Separately, we’re thrilled to announce our agreement to join the Expedia family of leading travel brands and couldn’t be more excited about what this move means for our very bright future. We’re eager to benefit from Expedia’s distribution, technology and expertise, which will allow us to provide an even better product and service experience for our owners, property managers and travelers. In this way, I believe our combination with Expedia will turbocharge our growth and industry leadership for many years to come.”
Dara Khosrowshahi, CEO, Expedia -“We have long had our eyes on the fast growing ~$100 billion alternative accommodations space and have been building on our partnership with HomeAway, a global leader in vacation rentals, for two years. Bringing HomeAway into the Expedia, Inc. family and adding its leading brands to our portfolio of the most trusted brands in travel is a logical next step. We have tremendous respect for the HomeAway team and the business they have built. With our expertise in powering global transactional platforms and our industry-leading technology capabilities, we look forward to partnering with them to accelerate their shift from a classified marketplace to an online, transactional model to create even better experiences for HomeAway’s global traveler audience and the owners and managers of its 1.2 million properties around the world.”
We have been booking 60K per year with them for several years. There are great sites out there they just dont get the play HA-VRBO does. This was such a dumb move that not only am I going to drop them Im going to do my best to convince a bunch of VROB-HAers to go with me. If we all get together we could cut a deal with the other sites and make them a lot of money by moving a big block of business there. May try to get some of my people to start up a website so ship jumpers can all sign up and togethere we all jump ship.
wow booked property they charged me 6% of the price never ever again with them f*** you greedy bastards
Interesting that the service fee was announced the minute that Expedia ( a huge company) acquired them with the announcement it would occur “mid 2016”–then described as mid-Q2 of 2016–so let’s say the second month of 2016? That was fast!
Here’s a great quote, Brian:
“Better monetization will allow us to accelerate revenue growth” = “More fees to us will mean higher revenues.” You can’t hide behind that statement. And the caveat of “most importantly will provide more resources for an even better product and service experience for our owners, property managers and travelers” confuses me…I thought you WERE providing a service to me the owner (the web site) and I provided the product and service experience to the traveler? Do you get my property cleaned? Do you make sure it has amenities for each guest and that each guest is welcome? no, that’s my job. You are now improving your “monetization” by now selling ad space with “SPONSORED ADS” on my VRBO page.
When Sharples started HomeAway, he researched other failed companies (one that Expedia had bought) and found it was instrumental for the homeowner/traveler connection as “homeowners viewed their homes as their personal property and they wanted to talk to people and they didn’t want to do everything online. The conversation was critical.” So now Brian is preventing us from talking to our client until they pay him an additional fee.
Thanks for proof that your effort to “monetize” is truly to increase just the bottom line.
I agree that the new Expedia service fee is outrageous. http://www.consumeraffairs.com/online/vrbo.html I have called VRBO many, many times about why our inquiries disappeared. not to mention NO BOOKINGS since before Feb. They always say the same thing- that hardly anyone else has the same situation.
There is lawsuit. All VRBO members between Feb. 2015 and Feb. 2016 are called non-named passive participants. I called the law firm in Texas yesterday. http://www.fbhf.com/ 512 476 2020
http://www.tnooz.com/article/homeaway-class-action/ If the case is certified as a class action lawsuit by the court, then all VRBO members would benefit from any good results. If it gets certified and anyone would like to opt out, they can do a written request to opt out. Please call the Cal. firm and ask for Michael Bowse 310 274 7100 check out http://www.facebook.com/groups/VacationRentalsbyOwners/files/
They are now charging the homeowners and the guests…very disgusted. I bet our business will suffer.
I can’t comment about mr sharpels 6m per year. But, I expect most would miss $200 on a weeks vacation.
Again:The immediate term solution is clear for me. Turn off online booking and offer alternative payment methods off site. Then seek alternative advertising space that’s more competitive. Airbnb isn’t a solution for me as they hold the payment until arrival.
It wouldn’t take much to set up an owner site that restores the spirit of where vrbo/Homaway once was.
VRBO – Home Away has steadily degraded in service while increasing in cost over the years. I was stunned when I saw the new Service Fee. This is really simple, I am going back to taking payments directly from renters, versus the CONVENIENCE of the online marketplace.
Too bad there is no real competition in the marketplace.
I remember the days, about 2 months ago, when I called customer service at VRBO, a person was at the other end of the line in seconds. Now, the typical wait is about 20 minutes. This is a direct result of their service fee. I also spoke to VRP who takes payments through the site at as high as 4.9 for international payments and I was told that a lot of complaints are coming into their company.
HA-VRBO, LISTEN TO YOUR CUSTOMERS. Fees as high as 499 are outrageous and unaffordable to many
The immediate term solution is clear for me. Turn off online booking and offer alternative payment methods off site. Then seek alternative advertising space that’s more competitive. Airbnb isn’t a solution for me as they hold the payment until arrival.
Homeaway really skunked me by inducing me to pay an annual fee to avoid service fees for using their website. Less than 6 months in to my 1 year agreement they again start charging me service fees after I paid a full 1 year subscription. FRAUDS
This is a disgusting example of CORPORATE GREED. There is no benefit to Customer or Owner in this move by Homeaway. I THINK OWNERS SHOULD ORGANIZE TO FIGHT THIS UNILATERAL BEHAVIOR.
Airbnb is a great alternative. I was pleasant,y surprised to find that it actually not a couch surfing site but a legitimate booking site that lets you verify renter prospects far beyond what vrbo does.
Yep, I am also po-ed. Yes, I’m also ready for litigators to get hold of this thing. I never had anything that was outright honestly written and explained emailed to me what they were doing. It is underhanded and low life greed that causes these things. I will also be changing when my prescription is up. In the mean time I’m listing with Home Escape and Air BandB what a rip off.
Fed Up
Yep, I am also po-ed. Yes, I’m also ready for litigators to get hold of this thing. I never had anything that was outright honestly written and explained emailed to me what they were doing. It is underhanded and low life greed that causes these things. I will also be changing when my prescription is up. In the mean time I’m listing with Home Escape and Air BandB what a rip off.
Fed Up
Expedia screwed me several times on booking flights and refunds WITH insurance and I swore I would never use them again and I havent for 2 years. I will not resubscribe and will cancel out tomorrow by using one of the worst setup sites on the internet….sianara baby
I am shocked! I can not believe Homeaway would do this. I pay 1500 per year for the listing and my bookings having been drying up despite the fact that I have a 5 star rating and VERY competive prices. I believe the reason is that the dollar is so strong that Canadians and Europeans are not traveling to Disney in Orlando this year. I already had a cancellation from Canada because of the exchange rates. I also believe and have been told that Europeans are reluctant to fly with all the unrest in Europe right now. And despite all that HOMEAWAY feels it has a right to make an ADDITIONAL 9 percent on the back of my customer. I am forced to search for a new website. If anyone can give me a suggestion who is best, please reply. Thanks.
OH MY GOD, what a rip off and how UNILATERAL for Homeaway to profit further from our guests.
I wil fight this and please let me know where else you hear people organizing against this corporate greed.
From not on I will try to talk guests into using airbnb to book their reservations. Im livid that I paid 1000 a year for fee free booking. Screw them. I will do whatever is in my power to move as much of my 50k a year business to another sight.
I am a Canadian advertising on Homeaway with the platinum package in which I pay 1,899 US and as a result with the exchange rate nearly 2,600 dollars. I was NEVER informed about the additional service fee between 4-9 percent and this comes as a shock to me. This outright wrong and VERY greedy. I made roughly 50,000 on my property in Mont-Tremblant in Eastern Township of Canada – we will call the Whistler of the East. They will now charge an additional 5,000 plus or minus over and above the 2,600 I pay for the annual subscription. This is insane to mildly to put it. What is the alternative at this point and I am willing to partake in litigation. They did not introduce this at the end of the subscription no they did it during which should be considered illegal. Sadly what is the alternative and they know it we are all that there mercy with the reviews and goodwill we built-up on there website. They have a monopoly and they are using it to be greedy. They have already factored in the attrition of members – they do not care. How do we rise-up together is the question. We must all send our feedback for starters on there website and then call them one after the other. Twitter, Facebook, LinkedIn they must be blasted and brought back to there senses. Use social media to bring them back down to earth. Use there own devices. They are gauging owners and now our guests and we will lose business because of this and this business model they have chosen is a race to the bottom. VERY GREEDY
I had given a customer a few months to book under the price that she was quoted back then. Now she messages me, what is the additional 167.80 service fee. I did some research and found this is an 8 percent fee from homeaway, in addition to the 900 dollar membership fee that I pay yearly. I am shocked and horrified. I never got a notice or letter about this. I do not intend to renew my membership.
Just to be competitive we will have to reduce our rates by the amount Homeaway is requiring as a service fee.
It is embarrassing to have to tell our potential customers that the reason the cost of our cabin is so much is that VRBO wants a significant amount of their money.
If we can be patient, somebody will take the dissatisfied customers of VRBO and generate a respectable replacement.
Wow – Am I hearing this correctly. HA was charging me and my customers $359.00 per year. I book about $12,000 per year. The initial 359.00 fee was approximately 3% of my revenue. I will now have to pay 9% of $12,000 and also the $359.00 fee for a new total of $1,449.00 about 12% of my revenue. Seriously a 300% increase. However you look at this it comes out of our operating cost! I will never use HA to book my own vacation and I will discontinue my rental through their site ! Did anybody get an email from HA explaining this?
Paying 349 for your listing is a steal. Insert sarcasm. There is also the credit card processing fee for every payment. I never received an email regarding the service fee. I am fighting back. You can fight back. No need to bend over
I cancelled our Home Away subscription. We will be allowed to continue to use the functionality of the site until our current bookings are past. Last year, we managed to take in 10K revenue, after taxes 6K, after maintenance, 5K, after mortgage interest -5K. Now, HA expects us to share an extra 1200 dollars year with them, beyond the 3 percent online booking, beyond the 400 we already paid. Robbery.
I wondered why I receive no inquiries in the last 10 days and I normally received three to four inquiries per day. They’re going to leave me no choice but to have to find another company. I’m going to take off work and start researching for a new company. Very sad
How does this help us Owners. Ive called several times and they say this is to pay for their 24-7 customer service. What a joke. This is about increasing shareholder value for Expedia. How will this generate more inquiries and bookings. They have not told us how this money will be spent on the Owner. They have changed the terms of the contract. I signed up for a yearly subscription. How can they charge my client a fee. I paid an enormous amount of money to advertise MY property on their site. And now they want a fee from my client. Where do I sign on for the class action law suit. And guess what, if you read their monthly updates come April they are changing the pricing structure to subscription based owners. This is a BAD business model and only hurts us.
We need to organize and file suit against this greedy bastards.
I found out about the service fee to our guests only because I I was addressing our damage refund policy. Had I not done this I would have missed the new service fee of 5.5 percent. I did not receive notice, HomeAway is not adding any additional services, and this was not part of my contract agreement with HomeAway. If this is not removed I will not renew. I will request payment by check mailed directly to me without charging this excessive fee to my guests.
How does this fee help Owners, Clients and Property Managers The only one this fee is helping is HomeAway and VRBO corporate pockets. The changes to the VRBO website and my rental ad over the last year is concerning and now we also are having our rental business put in jeopardy because of our possible clients getting charged another 9 percent of their rental fees. I was told that the 9 percent is going to improve the website and to add pay for more ads for the website. Why do we need more ads on our rental sites. My rental ad already has multiple competitive rental location ads on the sides and bottom of my rental – isn’t VRBO and HomeAway making money on these ads. I also appreciate the fact that basically all available contact with Customer Support has been virtually shut off to owners…. Not only do we now have a hard time contacting customer support to ask about the changes and their impact to our rental availability, but we get to experience a new breed of customer support people brought on who are rude, condescending, and Nazi like. I have been told that they can do whatever they want, whenever they want, and for how much they want and I don’t have any control over it. I have been told that they don’t want to hear my negative comments anymore and were hanging up. I have been lied to stating that the service fee was always included in the rental fees and when calling the sale person on it, was abruptly told I couldn’t talk to them as I was an Owner. What the hell is going on.
This FEE IS INSANITY, Once my 3 homes prescription runs out, I am changing companies. I see bad spending and greed, i am jumping ship I am starting Tomorrow to run ads on trip adviser . Hoping they do not go nuts in pricing. .
There was no announcement to managers for this service fee. It is crazy to charge so much for renting through HomeAway. I thought I was paying for the advertising. Now the consumer has to pay for the advertising also. I will be going another direction when my subscription runs out.
Yes , as a homeowner of three home generating over 100k a year and paying them over 7k a year they want more… The service fee is unearned, unwarranted, undeserved and amounts to nothing more than usery. I am ashamed of homeaway. What a terrible business model that will not sustain itself or grow due to greed. Then there is the censorship issue. Try using the atmospheric name or the key name they will be deleted and a blank line installed in their place. I will be joining the class action suit that arises. Are you listening litigators. Wise up expedia and lower this to a processing fee that is 1 percent maxing out at 25.00. Count Me as disgusted.
This is just crazy. I also have three short term rentals with three more coming live very soon. This, Service Fee is killing my reservations. I agree with everything you have said This needs to stop. If it gets too expensive for the consumer to rent short term rentals, they are going to go back to staying in hotels. A family going on vacation cannot afford to have more JUNK fees added.
Saw this was assessed for the first time in a booking request today, not aware of any notice from VRBO or HA this was going to start. Ive been paying the highest tier for VRBO marketing but my understanding of the listing model was either pay the higher annual listing charge or pay per booking. Sneaky and not above board.
As vacation home owners, curious what other marketing channels are people using to extend reach beyond VRBO-HA.
I agree with all the vacation rental owners. This was a shock to me today when I responded to an inquiry. I am livid and DISGUSTED with homeaway. They have not partnered with us to help us attract potential renters, but rather sneakily imposed this new service fee. For the same cost to a traveler, they could actually stay in hotel instead. In order for me to stay viable I must lower my rental rate so that greedy execs at homeaway can take a slice of the pie. As soon as my subscription expires I am withdrawing as well. DO NOT USE HOMEAWAY, VRBO, VACATIONRENTALS
This is absolutely the worst move for VRBO-HomeAway. While we were informed about the merge with Expedia we were not told about a new service fee. You have made me out to be a liar to my potential renters. When a 2-week rental was not booked as promised I sent an inquiry email to the client at which point I realized that the new service fee had been applied. That’s why the client did not book. This fee was applied directly to the client — 120 dollars on a 2,000 dollar rental. That’s more than 10 percent.
After being an original VRBO client back in the mid-90s I QUIT. This is worse than using a realtor.
Actually, $120 is 6% of $2,000, but I still agree that it is ridiculous that they are charging these fees on TOP of charging us $1,000/year to advertise with them!
Roughly 1000 per property was not enough, this now amounts to 5000 per property annually. Another customer lost with many listings.
So far the new service fees to travelers have been in excess of 10 percent to our potential renters. We already pay approximately 1200 dollars per year to Homeaway for listing plus approximately 3 percent for online payments. This is outrageous. What a terrible company.
Level of service has been declining since Expedia took over.
These fees represent the Final Straw for our business
We will be using a different site as soon as our subscription expires.
this is a greed fueled policy by Homeaway and will costs all of us owners business in the future by driving the room rate skyward