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.”
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/