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.”
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.