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OTAs Are Not the Problem—Dependency Is

By
Heather Weiermann
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One of the more popular sports in the vacation rental industry today seems to be bashing listing sites and OTAs (online travel agencies). The likes of HomeAway, Expedia, Airbnb, and—don’t forget—TripAdvisor are being blamed for commoditizing vacation homes, for diminishing rates, and for training guests to expect deep discounts or refunds. If we put a little effort into it, we can probably also find some way to blame them for the earthquakes and hurricanes we’ve seen of late. 

OTAs don’t need me to defend them. But the reality is that we, as vacation rental managers, share the blame. It’s our signature on those OTA agreements. We give these services access to inventory, booking pace, rate data, and all sorts of other proprietary information. We let the fox in the henhouse ourselves. We’ve even allowed our guests to believe they are better protected and told them they will get the best rate when they book via OTA sites. Case in point: While reserving a vacation home in Austin earlier this year, I found four different rates for the same property. The lowest came from the property manager’s own website—but I had to work really hard to find a way to contact them directly; it took multiple calls and emails for me to get what I needed to reserve my dates. Such rate disparities are rampant, and the difficulty of booking directly is often not worth the savings or the possibility of losing the dates a guest wants to reserve. 

For many of us, what started as an exciting new way to get more exposure for our vacation home inventory has become an unhealthy reliance on a single source of rental demand. 

Meanwhile, those who have held off are starting to feel like they are missing out and want to get into the game. And, all the while, the OTAs are reporting immense growth and market dominance. It’s time to take back some of the control before it is too late. To get started, here are five steps vacation rental managers should consider when working to ease their dependency on OTAs: 

 

1) OTAs are not the problem.

They are, however, enablers—and the competitors in your market may be codependents. If you rely on OTAs for a majority of your rental demand, you have likely become dependent on these sites for your company’s overall performance. What will you do when they increase their commission rates or limit the ways you can communicate with potential guests? If you are not marketing your homes via multiple channels, you are no longer in control—and the OTAs will be able to dictate to you how you run the reservation side of your business, as well as the costs. 

 

2) Math it out.

Yes, OTAs can fill your calendar with what feels like less work for you. But at what cost? The terms of OTA agreements will vary, but typical commissions range between 3 and 25 percent. Vacation rental managers with lots of inventory pay the least, whereas smaller, boutique companies pay the most. For those paying top dollar in commissions, the cost will be 25 percent in commissions for a three-night stay at $300 per night, or $225. Take a look at your last year’s profit and loss statement. How much did you pay out in commissions last year? Imagine if you had used even half of that toward marketing your own brand to drive more direct bookings and put the other half in your pocket. 

 

3) Make booking directly the best option.

Guests should get the best rates and benefits by booking directly, period. If you’ve already signed your rate parity agreements, honor them—but implement a best-rate guarantee and clearly state the advantages of booking directly, as Hilton does in its “Stop Clicking Around” ad campaign. As an added incentive, offer value-adds not available via non-direct booking methods. 

 

4) OTAs can be partners and competitors.

OTAs have made it clear they don’t care whether a guest books with a property manager or with an owner, as long as they book through the OTA site. How can OTAs command their high commissions, and just where does the money go? Have you seen the television commercials, the pay-per-click ads, the print ads, and banners? They’re competing with you and driving up your advertising costs, all while luring travelers from booking via direct channels. 

 

5) Make it easy to book with you.

OTAs are expert marketers—in fact, that’s really all they do! Improving the consumer experience is one of the easiest ways for these sites to build a loyal brand following. How does the booking experience on your site compare? Is your website mobile phone-compatible? How easy is it for a guest to call you from your site if they have a question or need assistance before booking? Does your website interface with your property management software to reduce the time you spend managing availability and rates and give you back time that can be spent strategizing? 

As for that vacation home in Austin, I was lucky enough to finally secure my booking at the lower rate before someone else booked my dates; however, I was worried it would not happen, and I would need to start my search all over again. Please don’t make your guests jump through the same hoops. 

Public Relations and the Sales Funnel: How PR Can Support the Journey from Awareness to Guest Loyalty

By
Jessica Gillingham
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First, public relations is not just about press releases. It’s also not even about securing coverage. Public relations is a management function that is concerned with strategic communications to build mutually beneficial relationships between an organization and its audiences, or “publics.” It’s also about increasing visibility, developing a reputation, building trust, and engaging in helpful conversation. But where exactly does PR sit within the marketing and sales funnel for a vacation rental management business? What impact can PR have on the guest journey from pre-prospect to lead, to guest, to happy and loyal brand advocate? 

Good PR shouldn’t exist in a vacuum. A PR campaign that is successful helps create new leads, but it also moves prospects down the sales funnel to vacation rental purchase, then develops them into vocal brand advocates ready to support the feeding into the top of the funnel again. A strategic PR campaign can (and often does) support the entire guest journey to purchase and beyond by influencing, to a greater or lesser degree, each of the key stages a potential guest will move through. 

 

Creating Awareness 

PR is typically best known for generating positive awareness about an organization. PR is often seen as a “top-of-the-funnel” exercise that creates interest in a consumer (guest) by helping to identify either a challenge or a need. A well-placed editorial, a targeted blog post, or a social media campaign can all help generate a “need” for what your vacation rental management business offers. PR also plays an important role in the discovery phase of future guests starting to think about where they want to go on vacation or on their next business trip. 

 

Consideration and Preference 

According to Expedia, travel consumers visit up to thirty-eight websites before making a booking. Other evidence shows that a customer will typically experience twenty-three touch points before they act. In today’s digital age, consumers are savvy, and they do their research. In the consideration and preference phase of the sales funnel, your next potential guests are weighing the pros and cons of the different travel options they have for their stays. They are investing their time on the various booking sites, reviewing accommodations and travel blogs, and visiting the sites of other vacation rental businesses and accommodation suppliers. 

PR is essentially about getting earned, not paid for, exposure of your content. One of the key reasons generating “earned” content is so powerful is because what other people or organizations say about you has far more influence on opinion and behavior change than what you say about you. Just ask Google. That’s why online coverage has such a positive impact on search rankings. 

Search marketing, search engine optimization, and pay-per-click ads are all essential to ensuring your offering is visible in the research phase of purchase; however, online coverage in the shape of an accommodation review, inclusion in a “Listicle,” a well-placed thought leadership article, a third-party review site, or a friend’s social media page may be just the nudge needed to move a prospect down the funnel toward purchase. 

 

The Purchase Decision 

What makes a prospect take the leap, part with their hard-earned cash, and choose one vacation rental business, property, or listing over another? The fact that the product or experience is expected to meet their needs and expectations is obvious. However, customers will do business only with a business they trust, and often one with which they have built some kind of emotional connection. This is where the PR skills of storytelling and building communities can be most powerful. 

Consumers are often distracted, difficult to reach, and fickle. A good PR strategy helps to build social communities around a product or experience that fosters emotional connection and feeling “part of.” Developing messages and stories that resonate with your audiences and distributing this through content that educates, delights, and influences can be powerful. 

Also, it is in this purchase phase (where timing is everything) that “earned” media can blend with paid media to edge a prospect into becoming a guest. When an editorial review is linked with a promotional offer, the proposition may be hard to resist. 

 

Developing Loyalty 

As we all know, the customer journey doesn’t end with purchase. Purchase is just the beginning of the next phase. There is typically a waiting period between purchase and experience, especially when purchasing a travel experience. Your future guests will be continuing their research, getting a feel for you, and anticipating their intended stay for weeks or even months before they actually walk through the door of your property. PR can support positive anticipation and help continue to foster the good feeling that your customer has made the right decision. This can be encouraged through social communities and dialogue. At this stage, your future guests may even start to join the conversation by expressing their excitement about their upcoming trip. Your customers will also be looking to you to ensure they have made the right decision by further researching the experience they can expect to have during their stay. 

 

Encouraging Advocacy 

Customer advocacy is essential for supporting lead generation and input for the top of the sales funnel. This is especially true for travel experiences. Happy customers make the best PR advocates. In today’s digital and social age, the power of customer advocacy can be a force in its own right. This is, as anyone who has had a bad TripAdvisor review knows, also very true for negative feedback. People are highly influenced by what their friends and family think and say, even if these “friends” are tenuous relationships via social media. Each individual’s social platform has become his or her own mini-blog and review site. Happy guests can also become excellent customer-centric case studies that encourage fostering the emotional connection often needed to encourage prospects down the funnel through consideration and purchase. 

 

The Cycle Continues 

Again, good PR doesn’t exist in a vacuum—or at least, it shouldn’t. PR works alongside all aspects of the sales and marketing funnel to support the guest journey from awareness to advocate and back again. 

When It’s Time to Sell Your Business, Who’s Looking Out for You?

By
Ben Edwards
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As the industry continues to change, vacation rental company owners are increasingly considering an exit or preparing their businesses for sale. While many owners are struggling with the numerous technology changes facing the industry or the disintermediation of the sales process, other owners are being solicited and are interested in selling or simply want to learn what their businesses are worth. Being solicited should not be a driver in pursuing the sale of your business because every company in the industry has been solicited for sale. I wish I could tell you that each business is special or that a prospective buyer has been eyeing your company because of its progressive operation. More likely, though, your business is on a list and is being solicited along with hundreds or even thousands of other vacation rental companies. 

So you’re considering a sale of the business, or you’ve been approached to sell the business. In either case, the following points should be useful in preparing for a sale or be helpful as a more formal process regardless of the motivation for selling. As a fundamental principle, keep your best interests in mind and ask this question: “Who’s looking out for me?” 

 

1) NDA 

Do not pass go, and do not collect $200 without executing a nondisclosure agreement (NDA) first. Anyone who calls and wants to discuss whether you’re open to selling your business will expect to sign an NDA. Anytime I receive one of those calls, I let the caller know that everything I have is for sale, including my children, and that if he or she wants to talk more seriously, we need to execute an NDA. Anyone who continues to poke and prod after you’ve requested an NDA may not be the right partner. 

 

2) Letter of Intent 

Once you have a fully executed NDA, feel free to disseminate high-level information about the business. Your goal at this stage is to convey enough information to entice an offer. Be careful not to communicate detailed data or proprietary information at this stage; that information can be shared after an executed letter of intent (LOI). 

 

3) Due Diligence 

Once a fully executed LOI has been completed, you’re ready to begin the due diligence phase of the process. Due diligence is the buyer’s opportunity to “pop the hood on the vehicle” and review every facet of the business, but they should be efficient and organized in the process. The idea is to prevent fishing expeditions. 

 

4) Purchase Agreement 

As diligence continues, a legal purchase agreement should be created, using the key points of the LOI and market-rate terms. It is important at this point to engage legal counsel. Legal counsel can make or break a vacation rental transaction. Often, local real estate attorneys may not fully understand the interworking of a vacation rental operation. It is advisable to find a law firm that understands the idiosyncratic nature of the business and can represent your interests in an experienced manner. It is important to note that there are acceptable levels of risk in a transaction; however, when risk hits an unreasonable level, it is time to pull back. Engaging in a transaction in which the purchase price is contingent on future unit count presents entirely too much risk and does not produce an optimal outcome. It is advisable to avoid these contingencies because the risk often outweighs the reward. 

 

5) Transitioning the Business 

As diligence is being finalized and the purchase agreement has been approved and executed, transitioning the business is paramount. A well-organized, thoughtful, and efficient plan will create a smooth transition and ensure that it stays on track. 

As you contemplate the sale of your business, know that there are more buyers than sellers. There is no reason to move forward with unreasonable deal terms or to incur too much risk. It is simply not worth it. Following a formal process and using a transaction adviser will help ensure that your business is sold for maximum value and the sale is successful. An engaged transaction adviser is the entity looking out for you by providing the following services: 

Position and present the business for maximum value 

Identify qualified buyers and initiate NDAs 

Ensure qualified buyers receive the appropriate reports and amount of information 

Keep the process organized and moving forward efficiently by soliciting offers with sound market-rate terms that do not present an adverse amount of risk 

Leverage industry and market experience for offer-acceptance guidance 

Close successfully 

Provide transition assistance and guidance 

 

An experienced transaction adviser is intent on maximizing the value of your business and ensuring that deal terms are fair and reasonable and the transaction closes efficiently and successfully. One wrong turn could adversely affect the entire transaction. Leveraging industry knowledge and experience in markets throughout the industry can mean the difference between a well-executed and profitable exit strategy or regret. 

Top-Down Leadership Insights for Vacation Rental Managers

By
Clark Twiddy
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Senior Leadership: The Difference between Well Managed and Well Led

It makes sense that part of the reason we’re seeing so much interest in our industry on the part of venture capital and private equity is the fact that so many of our traditional businesses have been well managed and well-led for long periods of time. That stability—as an alternative investment—is attractive on its own. 

One challenge among many others for hospitality business executives is not only to manage well but to lead well. Are you a senior staff manager or a leader—and what’s the difference between the two? It makes sense that how the senior group defines themselves reflects the priorities of the senior executive. Here’s a simple clue to what I think will lead us to larger areas of focus: if a person is a manager, he or she is focused on day-to-day and operational challenges. This is a great thing. A relentless focus on fundamentals is a business foundation. If someone is a senior leader, he or she will be focused on future problems, growth opportunities, risk, and people. The difference between the two is important both in terms of time horizon focus and business challenge. The simple analogy here is of an airplane cockpit: The view from the cockpit doesn’t show what is below the aircraft because you’re there already. The view from the cockpit looks out on both what’s around you and where you’re going. 

I’d argue that leadership—good, solid, predictable leadership—is a long-term advantage for companies both in the face of well-funded venture capital and private equity (VC/PE) firms and for attaining the best possible long-term results. It’s fair to say that like most investors, the VC/PE teams will be looking for short-term returns on investment. The best way to achieve those kinds of things in the short term are through new access channels on the revenue side with operational efficiencies, functional symmetries, and workforce optimization on the efficiency side. Those are properly management functions. However, a well-led company may choose to focus on long-term growth over short-term investor return. As a differentiator, that means investment in staff with training or quality-of-life improvements. It may mean a deliberate focus on customer relations that will prove costly up front but return handsome dividends on a longer timeline. It may mean infrastructure that in a digital age becomes more and more controversial. 

As we search for antidotes to the perceived digital restructuring of our industry, I believe a focus on good leadership is a great place to start if you’re thinking long term. By leadership, I mean an ability to deeply think about future opportunities, the importance of surrounding your business with bright, well-trained, and potential-reaching staff members, the energy it takes to believe in your company’s vision, and ultimately the selflessness to sacrifice short-term gains for long-term results. As an example of questions you should be asking yourself is: is it in your power to make sure that your company is the best employer in your area? 

Leadership, since the days of Alexander the Great, means taking care of your team. Great leadership—pick whomever you choose as an example here—usually means sharing opportunities and challenges with and alongside your team. It means setting an example—are you out front greeting your guests? Walking through your properties with your cleaners? Talking on the phone with your homeowners? 

Interestingly these kinds of behaviors are what become irreplaceable in a digital age. There is simply no app for that. Good leadership will translate well—something digital can manage, to a degree, but digital will never lead. There’s the advantage right there. It might be worth thinking about great leadership in addition to great management as we collectively seek to differentiate ourselves in the digital landscape. 

 

 

 

Developing Mid-Level Managers as a Competitive Advantage

What’s your value as a company? When we think of value, we usually think in specific and measurable dollar amounts, but price and value are distinctly different things. While pricing reflects a temporary present condition, value, I believe, includes some of those things that are tough to measure on a day-to-day basis: management strength, brand promise, industry credibility, level of risk, long-term viability, and so on. 

In North Carolina, we’ve seen a large number of mergers and acquisitions in the banking industry lately that in many ways parallels the unprecedented level of outside investment activity in the vacation rental sector. When we consider value, here’s a great facet to include in that conversation: management-in-place. As for the banking comparison, I think it’s useful on occasion to look at other industries to compare acquisition valuation with our own industry, and it’s clear in banking that strong management-in-place is a top challenge when change becomes rapid. 

To start with a definition, management is the function of deciding priorities, driving implementation, measuring results, and regularly assessing feedback. If you’ve been successful in growing your business, you know that this function can be a critical growth driver or growth dragger, depending on circumstances and the approach taken. 

From an acquisition perspective, management-in-place is a question of several factors: management development within an organization, talent retention, unique operations experience, in-depth local relationships, and future leadership potential, to list a few. Those areas operationally reside in mid-level management; members of that key group translate vision into execution and form the front lines of your guest and owner experiences. Mid-level managers are also the ones who can truly drive (or stall) innovation. These individuals carry with them not only a commitment to the company but also a good deal of future capability for the company. In other words, they’re a key to the future. 

Members of that group are also the key to a major growth challenge: the dread of a bureaucracy. Few business owners would describe their own organizations as bureaucracies unless reminded of the old Lyndon Johnson definition: “If the person who answers the phone can’t answer the question, it’s a bureaucracy.” To a great many people, bureaucracy has become a synonym for something slow or devoid of humanity, and that’s the last thing that a company wants if it aims to achieve success. 

We all interact with bureaucracies on a daily basis, yet few of their employees come to work each day excited to make other people’s lives miserable. Again, it’s those mid-level managers who can make or break an organization, and they’re the first group to address when changing a culture that has become stifled or slow. 

To wrap up, as our industry wrestles with valuing monetarily what we do as independent organizations, it’s important to remember that although price might reflect a moment in time, value carries with it the likelihood of long-term success—and with that comes financial strength, stability, less risk, and a solid future foundation. It’s these kinds of things that attract outside investors. People place money only where it feels safe to do so, and a strong team of mid-level decision makers goes a long way toward investor confidence. 

How to Make Your Vacation Rental Business a Success

By
Danielle Moses
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Welcome to a New World of Travel 

The travel industry has hit a new level in the past few years. Travelers are not just visiting your average urban cities around the world, they are exploring everything from the countryside to the jungle. Always connected and constantly looking for an adventure, today’s travelers want it all—from the most exotic to the most centrally located. Travel is no longer a seasonal industry, it is a year-round business. When the opportunity arises, seize it. 

Being a modern-day traveler is about more than seeing new places around the world; it’s also about gaining new experiences. Most young travelers seek unique travel opportunities and want to connect to the places they visit and be more like locals than tourists. 

Travelers no longer need or want to pay for overpriced hotels and unnecessary amenities. For these reasons, they flock to the world of short-term and vacation rentals. According to the Smarthosts Vacation Rental Forum, in 2016, the vacation rental market was valued at $100 billion dollars and is predicted to reach $167.9 billion by 2019. This industry just keeps growing and is taking over the travel industry. This takeover is forcing businesses to market in an entirely new fashion. 

 

What You Need to Make It Big 

Short-term and vacation rentals fulfill travelers’ desires to experience local life. With a booming industry, the business opportunities are endless. As the industry continues to grow and become more competitive, it is important for property managers to have the smartest technology available to organize their companies’ activities and help them reach their maximum potential. 

Guesty makes all of this possible. With an end-to-end solution for short-term property managers, the platform works to centralize businesses’ activities in one place. 

Guesty’s robust yet simple platform allows property managers to control their listings as they wish. With features such as channel management, you can sync all listings with each other and list them with the correct availability while maximizing your revenue and increasing bookings on empty nights. Guesty also offers property managers the opportunity to control the data and information shared through an owner’s portal. This provides homeowners with transparency, so they can view the revenue and bookings in a report while letting the property manager handle everything else. 

Guesty is here to ensure that operations stay manageable and organized. Seamless automation tools allow property managers to automate emails to guests regarding events and customize content. These automation tools assure that guests receive responses to their questions in a timely fashion as well as any information they need before, upon, or after check-in and check-out. In addition to the operation tools that Guesty offers is another favorite: the Staff Management App. This feature gives your staff members easy access to all their assigned tasks along with any listing information needed to get the job done. Managers can track statuses and completion of assignments, monitor work duration, and see the tasks remaining on the Guesty dashboard. 

Keeping a business organized is the key to helping it grow. With the reporting and analytics features offered on Guesty’s platform, every property manager has the tools he or she needs to see where the business is growing and where it can improve. Companies can use this data to more than double their business revenue and increase bookings and guests. This information can even lead to an increase in listings. The Guesty Integration Marketplace allows managers to use their preferred apps and operate as they choose with all its integration options. 

Guesty supports property management companies of any size— from those with a few listings to those with hundreds of properties—while improving their management performance and demonstrating automation and consolidation. Guesty’s seamless cloud-based property management solution will increase conversions and profits by reducing time spent on tedious tasks and investing it in creating additional streams to maximize revenue. 

 

The Takeaway 

Guesty is recognized as the one unifying solution for property managers and has implemented tremendous ability for short-term property managers to scale their businesses. “Guesty’s features will generate more direct revenue together with the ability to increase awareness and distribution of listings,” said Amiad Soto, CEO and cofounder of Guesty. “Our company has been growing tremendously in order to continue producing outstanding new features and open up endless opportunities within the industry.” 

As the travel industry changes, Guesty continues to provide property managers with state-of-the-art smart technology in one seamless end-to-end platform. 

10 Tried and True Ways to Attract and Retain Home Owners

By
Jodi Refosco
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Growing your portfolio of homes while retaining your existing owners can be a bit of a juggling act for busy vacation rental (VR) managers. Reaching either goal requires you to be a savvy marketer and a strategic planner with strong brand recognition and a robust online presence. That is the basis for positioning yourself as an expert in order to build the required trust for successful partnerships. 

Having built a company from the ground up, I have a lot of experience with the peaks and pitfalls of growth. We started with just one home in 2008. By July of last year, we had 239 properties—all of which were acquired organically. The following month, we finalized the purchase of a competitor that increased our inventory by 100, and we currently manage more than 380 vacation rentals. 

I put together a list of ten tools that are essentials for your “owner acquisition toolbox.” They can help you stand out from your competition as you nurture new and existing relationships. 

 

1) Email Marketing 

Whether you have access to public email lists in your area or build a database of prospective owners from scratch, email marketing is an inexpensive and efficient way to keep your brand in front of your target audience. 

 

2) Messaging with a “Wow!” Factor 

Think outside the box to attract owners. Everyone likes getting a surprise package in the mail—think promotional items that really pop! Send owners an item that is both fun and useful, and not only will they think you are clever, but items that are used daily will keep your company top-of-mind. 

 

3) Postcards—The Old Standby 

While much of our marketing efforts have moved online, don’t discount traditional methods such as postcards. In some areas, getting mailing addresses through tax lists may be faster and easier than building an email database. 

 

4) Triggered Emails 

After that first conversation, a hot lead can quickly turn cold if you do not continue the interaction. Triggered emails allow you to send follow-up messages that are both personal and informational with a frequency that you define. It is a “set it and forget it” way to keep the discussion going. 

 

5) Turn Existing Owners into Brand Advocates 

Word of mouth carries a lot of weight when choosing a management company. Showcase short videos or written testimonials on your website, and let existing owners share their experiences. 

 

6) Connect in Person 

A big step toward retaining an owner includes personal connections. Host a coffee hour or luncheon to provide an opportunity to connect with your team and to share company updates, milestones, or highlights. 

 

7) Stay in Touch 

When you are not connecting with owners in person, keep them engaged with a newsletter or dedicated owner blog. 

 

8) Educate to Inform and Set Expectations 

This one applies to both acquisition and retention. Take the guesswork out of owning a vacation rental home by answering FAQs, providing valuable tips, or sharing data on how to make the owner’s home more marketable. 

 

9) Social Media Is Essential 

An owner who is researching your company will more than likely check out your social media profiles. Posting with consistent frequency, having a large following, and promoting both your area and your homes tells owners that you are on top of your marketing efforts. 

 

10) Make Your Website a Valuable Resource 

Craft content for your website that offers value, and make it easy to find. Whether it is suggestions for popular amenities or conveying the importance of a deep clean, equipping your owners for success creates a win-win situation. 

There is no simple way to secure and retain owners, but you can significantly improve your odds by including these methods in your overall strategy. 

What’s Happening to Your Profit?

By
VRM Intel Staff
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There’s a leak somewhere. You can hear it. Drip. Drip. Drip. If this keeps up, your whole house will be flooded. Naturally, you will find the source of the leak and either fix it yourself or hire a professional to do it for you. We don’t leave leaks unaddressed in our homes, so why do we allow our profits to continually leak out of our businesses? 

As small business owners, we’ve got a simple decision to make: Will we continue to exhaust ourselves, working to just get by and maintain the status quo, or will we decide to stop the leak and begin to enjoy the potential profits in our businesses? Thousands of businesses, both big and small, are just barely getting by. They make it month to month, surviving with “on paper” profit but with little to no real cash flow. If this sounds like you, how can you find a solution for your business? 

We have all been there: chasing the mighty promise of profits, only to end the year with nothing to show for it. I made a number of mistakes and finally decided that I’d had enough. The perpetual hamster wheel was getting me nowhere. That’s when I decided to dig into my numbers. I pored over the financials trying to simplify the rows and columns of numbers and figures on my P&L and balance sheet. The business seemed to be running well, except for the glaring fact that I had very little cash profit to show for all my effort. 

That’s when it hit me, like someone was banging a huge gong inside my head. I was overcomplicating the whole thing. Keep it simple, stupid. What’s the one thing that defines your business? How do you get paid? For the vacation rental business, it’s a reservation, a turnover, a guest departure, or a checkout. 

I realized that I didn’t need to have fifty different line items in my P&L, and I decided to simplify the financials to its most basic form. Profit is traditionally calculated by subtracting your expenses from your revenue (Revenue − Expenses = Profit). This is not rocket science. What I saw was that I was looking at my financials too broadly. As I drilled down and looked a little closer, I began to find the leaks. They weren’t just small leaks, either. It wasn’t just a drip. There was a steady flow of money leaking out of the business. I felt sick to my stomach. I had fought tirelessly to grow my business, thinking that growth would result in higher profits. I was wrong. My mind raced back, and I quickly calculated what I had lost due to my inability to see this in the past. It was several hundred thousand dollars. I needed a drink. 

The night of this realization, I couldn’t sleep; it was like I was haunted by little personified dollar bills. They were chasing me around in my dreams. I kept waking up, thinking about all the money I could have made, thinking about how different the business could have been if I’d seen this earlier. 

Then it came to me—the reason for my leaking profits. I shared the reason with a good friend of mine (we’ll call him Teddy), who had asked me to help him with his business. When I first shared my idea with him, he looked at me blankly and then he said, “There’s no way I can do that. I want to grow my business. If I do what you say, I won’t be able to support my growth.” I tried to explain my idea to him, but he didn’t get it. I wanted to shake him and yell, “Dude, listen to me!” I didn’t. I just shrugged it off and helped him focus on his challenge at the time. It turns out that there are often several issues affecting profitability, but for him, there was one glaring issue. 

A couple of months later Teddy called me, frantic. He said, “You were right. You were right! I just checked my expenses per property. I average $125 per turnover. That includes the cost of marketing, reservations, guest relations, accounting, and administration [his total cost per turn]. On some of my properties, I only make $120 per turnover. I’m losing money by managing these properties. Holy crap, you were right! I need to cut some of these properties. I’m making no profit on any of these properties!” 

What I had discovered, and what Teddy eventually discovered as well, may seem counterintuitive at first. Decreasing the number of properties in your inventory (or clients you serve) can in fact improve your bottom line. You try to rationalize it; “Self, they are covering my overhead. My gross sales are off the charts. I am crushing it! If I cut them, then I’m not growing.” 

If you are honest with yourself, though, you know that they are the reason for your ridiculous overhead costs. You’ve hired more personnel just to cover the day-to-day activities required to service those clients. You don’t have time to train all those employees, so frustrated employees leave to find greener pastures, or, worse, they stay and bog down your inefficient machine. Nevertheless, you had this grand vision that you needed to be the biggest and baddest [insert your title and dream jobs here] on the planet. You thought that by growing your business as large as you could, you would naturally reap higher profits. Unfortunately for you, and for most businesses in the world, high gross sales do not necessarily mean higher profits. 

Someone once told me, “Volume fixes all your revenue problems.” I couldn’t disagree more. Gross sales and volume do not fix all your problems. They can actually exacerbate your problems. Do you have poor profit margins on a specific client? Do you think it’s a great idea to pick up one hundred of those clients before you know that you have poor margins? In this case, two negatives do not make a positive. It makes one huge problem. 

I’m no accountant, but I think somewhere along the way, we overcomplicated the way we manage the financials of our businesses. 

Granted, maintaining accurate financial statements is imperative if you ever want to sell your business or if you want to keep Uncle Sam off your back. There are great accountants out there for that. As a busy manager of a thriving small business, you don’t have time for that. You need to focus on your business and to focus on your profit above expenses and gross sales. Growing sales tends to boost our egos, which subsequently fuels an expense-driven fire that eventually burns down our businesses. And we wonder why so many businesses fail! There’s a beautiful mix between gross sales and minimal expenses that will make you profitable. I’d encourage you to simplify your business financials as much as possible; in fact, try to find the simplest metric in your business that will help you easily identify your profit potential (think like Teddy did). I don’t know your magic number, but I’m certain we could figure it out. 

Below are simple steps to help you push your business toward profitability and sustainability. It would be silly to think that these would fix every problem in your business. They won’t necessarily make your business run like a well-oiled machine, but you should no longer be driving a Ford Pinto.

 

7 Ways to Foolproof Your Business 

1) Define Your Vision. 

Focus, focus, focus. Stop acting like a squirrel, chasing every distraction under the sun. Focus on the verticals with the most opportunity. While you’re at it, mathematically define what that opportunity looks like. Does it meet your profit requirements in the next step? 

 

2) Simplify Your Financials. 

Revenue − Expenses = Profit. I like to know the conclusion first. If I know where I’m going, I can get there faster: Profit = Revenue − Expenses. There we go. I feel better now. Profit! Set your profit margin. Be realistic. Adjust your profit margin. Try to focus on transactions that will meet your profit requirements. There will be times when you negotiate and reduce your profit, but don’t sacrifice too much. 

Simplify your financials. For each client and each widget, do you meet your required profit margin? If not, what’s going on, and can you adjust the variables? 

 

3) Standardize Your Business. 

Create standard operating procedures (SOPs). What makes your business run smoothly? How can you re-create that process? Test it. Test it again. Write it down. Now you have your standard operating process. Repeat those steps until you have documented all the day-to-day routines in your business. 

Create HR manuals. Vacations, sick days, payroll, benefits—all these policies need to be documented. You also need to comply with state and federal regulations for how to treat your employees. Your goal is to keep from having any lawsuits and to make sure everyone is treated fairly. 

Articulate Job Descriptions. You can’t manage what you can’t measure. You can’t measure what you haven’t defined. You need to be sure to document your expectations for all the roles within your business. There are a plethora of job descriptions online for almost any position you envision. 

 

4) Train, train, train. 

You have to replicate yourself and all your best employees. Here’s the truth: you are going to burn out. OK, maybe not tomorrow or next week, but soon. Then again, maybe you won’t burn out, but you will want to enjoy your life outside of work. Life is too short to work all the time. Create your clones and encourage them to create theirs. 

 

5) Find a mentor. 

There are lots of experienced guys and gals who have already gone through what you’re going through. Their experiences have given them wisdom that you could use. My wife would laugh at that previous sentence. It has taken me a long time and a lot of mistakes to begin admitting that I need help, but I do. I don’t know everything, and I need help. There’s no need to reinvent the wheel. Find someone who’s been where you want to go and ask that person for advice. If he or she won’t give it to you, annoy him or her until he or she concedes to your nagging. Once you find a mentor, go ahead and lose your pride. He or she will bust your chops. It’s good for you, and you need to be humble enough to listen to his or her advice. 

 

6) Marry your people with technology. 

Utilize your people for what they were intended to do: have and develop relationships. Use technology to manage the portion of your business that computers can handle. Computers weren’t created to build relationships, and people weren’t built to be logic-driven, data-crunching machines. Leverage the strengths of each and see your business take off. 

 

7) Put your people before your business. 

Putting people first doesn’t mean hiring people who are unqualified. Your employees are the most important asset of your business. Cultivate and care for them, and they will help you achieve your vision. 

I remember, when Pop, my step-grandfather passed away, how many people came to his funeral. I had only known him for a couple of years, but I was impressed with how loved he was. I didn’t realize the extent of that love until a couple years later. I was hanging out with one of Pop’s friends, William. We were chatting over a few cold beers, and I told him that I wanted to eventually run my own business, and impact people the way Pop had. He exploded! Think grizzly bear attacking a small child, except that I was a grown man and might have peed myself. I played dead. William screamed at me, “You’ll never be half the man Pop was. Your Pop saved the lives of half of the people in that town we live in. Don’t ever think that you’ll be even near what he was.” I thought about what he said later and continue to think about it every now and again. Life is built on relationships. Life excels on relationships. William wasn’t mad at me because I thought I could be Pop. William just wanted me to understand that Pop sacrificed so much for so many, thereby endearing himself to his employees. A leader must first serve; William taught me that was how Pop inspired him. I wanted to be like Pop. 

Expedia CEO Discusses HomeAway’s Q3 Growth: “They are just pushing a ton of change.”

By
Amy Hinote
-
9

Despite an active hurricane season, strong third quarter performance by HomeAway provided Expedia with much needed positive talking points during today’s earnings call, as newly appointed CEO Mark Okerstrom announced that the company’s revenue of $2.97B (+15.1% Y/Y) missed by $10M, resulting in a 16% drop in stock price during after hours trading.

The highlights from HomeAway include:

  • HomeAway delivered $305 million of revenue, representing an increase of 45% year-over-year.
  • HomeAway room nights were up 36% year-over-year.
  • HomeAway offers nearly 1.5 million online bookable listings.
  • 95,000 HomeAway listings are now on 28 Brand Expedia, Orbitz, Travelocity, CheapTickets and ebookers points of sale (up from 65,000 in Q2).
  • Over one-third of HomeAway’s nearly 1.5 million online bookable listings are now instantly bookable .
  • HomeAway continues to roll out updates of its secure messaging platform for its North American and European sites, with pre-booking communications now facilitated through the secure messaging system for over 65% of listings.

“Q3 marked another solid quarter of execution by the team as they continued to drive their transformation from a subscription business to a true online eCommerce business,” said Okerstrom. “For Q3, transactional revenue exceeded 75% of HomeAway’s total revenue for the first time ever. Conversion rates at HomeAway continue to steadily climb as they ramp up test and learn velocity on traveler facing experiences and introduce new features making it easier and more attractive for travelers, property owners, and managers to transact on the HomeAway platform.”

CFO Alan Pickerill added, “HomeAway gross bookings grew 44% while revenue grew 45% to $305 million. Stayed property night growth came in at 36% and would have been higher absent the hurricanes. Third quarter transactional revenue grew by 116% and peaked for the year at $236 million.”

Pickerill continued, “Subscription revenue declined, decreasing by 37% year-over-year, as HomeAway continued to gain momentum in their eCommerce transition. HomeAway reported the highest quarterly adjusted EBITDA in the company’s history of $126 million representing 63% growth year-over-year.”

 

Expedia to “Lean Into” Paid Marketing Channels

“Given solid progress at HomeAway, we plan to lean even more heavily than anticipated earlier this year into paid marketing channels, a trend we expect to continue through 2018,” said Okerstrom.

“For HomeAway, for example, they by the end of this year, we’ll be in a position where they have a true technology-driven performance, marketing platform in place. And with the increase in online bookable properties, they’ve got now up to 1.5 million [listings], with 1/3 of those now being instantly bookable with the platform in place. They’re just going to be in a better position to actually execute on performance marketing, make sure they’ve got coverage and actually track the results than they’ve ever been, and so that will enable them to step it up.”

“Listen, I think certainly HomeAway’s aspiration would be to accelerate online bookings. But remember that the historic portion of HomeAway’s bookings that came from performance marketing channels was pretty darn small and actually a lot of it comes direct. You know, a lot of it comes through other branded sources, you know, SEO is a source, and that’s been challenged, you know, across the whole industry. So the question is does the performance marketing, does that become big enough to move the overall number up or not. And we don’t really know the answer to that. I mean, what we do believe obviously is that the performance marketing based bookings are going to grow very quickly and will probably accelerate. But whether or not that can move the whole number, it’s hard to say at this point.”

 

Will “Elevated” Guest Fees Remain?

Deutsche Bank’s Lloyd Walmsley asked the team, “Can you kind of give us a sense for whether the fees that we’ve been seeing on the customer side of late are going to continue at these elevated levels into 2018, or if these are perhaps just tests?”

Okerstrom replied, “It’s hard to say with any precision whether looking forward fees are going to be at the level that they’re at right now. The team is really doing a ton of testing. So, you know, you may see something that other consumers don’t see. I mean, we will do things where we test things sequentially. So it’s hard to get a gauge or give you more guidance than sort of keep your eye on things.”

 

Is HomeAway Beating Its Competitors?

According to Okerstrom, “If they were sitting still and doing nothing, I could say that they’re just getting lifted by the rising tide, but they are just pushing a ton of change. It’s remarkable how much change that that team has accomplished in such a short period of time, and they’re not even nearly done. So I think that they’re winning in the market. Now, whether or not they’re winning from a like-for-like competitor, whether they are encouraging more people to travel than would otherwise travel, whether or not they’re taking from the traditional lodging market. It’s hard to say, but we do believe that they are growing significantly faster than the overall alternative accommodations market.”

 

Subscription vs. Pay Per Booking

Okerstrom said, “In terms of mix between subscription and PPB (pay per booking) on the host side of things, you know, I’d say generally the trend has been to shift to more PPB. It’s hard to say exactly where it will go. I mean, I think that all of the hosts are trying to figure out what’s the optimal break-even point for them. But I think increasingly as HomeAway transitions to, you know, a real marketplace model and starts introducing things like the Accelerator program which like we’ve got on the hotel side, I think it may be the case that PPB hosts just have a better ability to compete in that marketplace. But time will tell. But the trend is definitely towards more PPB.”

 

Hosts, not Homeowners

For the first time, Expedia executives began referring to vacation rental homeowners as “hosts” instead of homeowners or owners. The term “hosts” was made popular by its primary competitor Airbnb, and the change in terminology indicates an internal shift in how Expedia is thinking about the industry.

 

Integrating HomeAway Inventory onto Expedia Sites

Okerstrom: “In terms of integrating the inventory from HomeAway onto the Expedia, Inc. sites, I think the first pot of inventory to go after there is the 500,000 some-odd instantly bookable listings. We’ve got 95,000 of them now integrated into our core lodging stack. And really the goal right now is to get ourselves in a position where we have real property density across a number of popular destinations and we’ve got enough demand which we now are up to 28 different points of sale, that we can really start to get the statistical significance on tests that we’re running around how do you best present this inventory to ultimately deliver the most bookings by essentially matching that inventory with the demand or the customers who are actually looking for it.

“So that’s what it’s about. I think we will ramp it up even further here in the fourth quarter and into 2018. And our hope is that we do get better and better at matching the right customer to the right property. Our expectation is that we will. We do not have yet firm plans on integrating all of the other inventory yet, although it is, which is not instantly bookable, but is absolutely on our radar, and that is something that could come later on in 2018, but we have no definitive plans at this point.”

 

HomeAway’s Target Revised 

Expedia also announced that it is revising targets for HomeAway downward. According to Pickerill, “We see great potential at HomeAway, given solid progress we have seen in the transition so far. As such, with our eye to the long-term opportunity, we are inclined to continue to invest in that business. Additionally, HomeAway is undertaking its own cloud migration, which we estimate will result in nearly $30 million of direct cloud expense next year. Given these factors, we now expect HomeAway’s 2018 EBITDA to be below the previous target of $350 million.”

Source: Seeking Alpha EXPE Q3 2017 Transcript

One Size Doesn’t Fit All in Vacation Rental Owner Acquisition

By
VRM Intel Staff
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1

Great homeowners are the foundation of every vacation rental management business, and each year, attracting them becomes more of a challenge. As OTAs increasingly offer many benefits of a property manager, the task of owner acquisition grows harder every year. 

The common question “What can you do that I can’t do myself on Airbnb, HomeAway, or VRBO?” is becoming tougher to answer because there are so many options for homeowners to manage their own rentals—even from a distance. 

So, unless an owner is firmly committed to this path, managers need to become creative in convincing owners that choosing a property manager is the best decision for their rental business.  

The first step is to appreciate that this is not a one-size-fits-all process. Owners have different goals, needs, motivations, and levels of interest/involvement. A simple web page with a list of features, an information sheet, and a single follow-up call might have been enough to capture a new owner in the past, but now we need a comprehensive strategy that considers a multitude of personas and how to reach them. 

Owners come to a rental agency via a couple of paths. Some are completely new to rental and need guidance and education on the process. They aren’t confident enough to carve their own way as an RBO, although that may be a goal for them.

Others may have been managing their own rentals for a while and are ready for a third party to cut the stress and time-eating aspects of the business. They have experience with the operational side of the business and want to hand it over to someone else to manage. 

A third group is the investors/owners who have thoroughly researched the market to look for the best location to purchase. They know what they want to achieve in terms of income and are looking to a property manager to bring that in. 

Identifying different types of owners and uncovering their pain points and creating persona-based strategies for acquiring them will help property managers define the types of information they need to develop and how to approach each one individually. 

These examples are some of the types of owner personas a management company might deal with, the relationships that work with them, and some ideas of the free information that would appeal to them. Different locations and regions tend to attract more of one type than another, so for those entering the business, it’s worthwhile to spend a good amount of time on research.  

 

Absent Investor/Owner  

Jeff is a millennial investor who has been attracted to short-term property rentals through seminars he’s attended. He knows there is significant growth potential in the market through what he has heard about Airbnb, and he has researched locations thoroughly. He wants to be completely hands off with the operational side of property management, but he’s interested in traffic to the listing, conversion rates, channels that are in use, and cash-flow forecasting. His goals are to buy additional properties and to build up a portfolio of units that rent consistently well, so he is interested in regular performance reports. 

The relationship with Jeff is businesslike. He understands terms such as cash flow and dynamic pricing, and he wants frequent reports that show how his place is doing, where it is being advertised, and how seasonal rate changes impact his cash flow. 

What Jeff Wants from a PM Company 

Jeff wants efficiency, regular communication with an account executive, and updates on the performance of his properties. Although he’s hands off with the operational side of the business and doesn’t deal directly with his guests, he pays close attention to reviews and feedback.  

The most effective lead magnets in attracting this persona would be 

  • Financial forecasting tools
  • A Guide to Preparing a Home for the Millennial Market

 

Owner/User Family Home  

Bill and Sheila inherited their vacation home and want it to remain in the family for future generations to enjoy. They see rental as a way to keep the home while allowing them to use it for family vacations once or twice a year. Because they’ve known the home for decades and their kids were brought up vacationing there, they value some of the traditional aspects that may not be desirable to their guest demographic. They know little about the rental market beyond what they’ve heard from neighbors, and although they know some updating is necessary, they are reluctant to make too many changes. Their primary concern is that guests will look after the property and not use it for parties and teen get-togethers. 

The relationship with Bill and Sheila is nurturing. They want to feel confident that their home is being cared for and that guests respect it. It’s also important that they appreciate the changing nature of the guest demographic to help them understand the hospitality perspective of today’s rental industry.  

What Bill and Sheila Want from a PM Company 

Bill and Sheila need help building confidence that this is a good step for them, and they need to learn about their role as owners in the travel industry. They value a personal connection with an owner liaison/account manager who can explain in detail what they will need to do.  

The most effective lead magnets in attracting this persona would be 

  • A Guide to the Top 10 Features Families Look for in a Vacation Home
  • What to Expect When Renting Your Home (video series). 

 

Involved, On-Target Owners 

Joe and Mike have experienced many vacation homes around the world, and they want to buy their own. They may want to retire there eventually, but they see the home as an income generator in the meantime. They are busy with their own business, so they want an agent to manage marketing and reservations. But they want to be involved in the management of the property, including changeovers and maintenance. If the property is vacant at any time, they might want to use it, but their primary goal is for the property to pay for itself. They want to learn everything about the business and are open to all ideas for maximizing income.  

What Joe and Mike Want from a PM Company 

The relationship with Joe and Mike is more of a partnership given their desire to be involved in the operation of the rental. They want to share their ideas and get feedback on any improvements they make.  

The most effective lead magnets in attracting this persona would be 

  • How to Create a WOW Response and Get 5-Star Reviews
  • Checklist for Creating a Gourmet Kitchen for Your Guests

While creating these positive personas can help in a quest for great owners, it’s also a sound idea to look for the negative aspects that act as red flags. The potential of a successful property can be held back by an owner who is not fully invested in hospitality, has little concept of the cost of doing business, focuses on minor damage, or has listed with different agencies in the past. Here’s an example. 

 

The RAM Owner 

Gary has registered with several local agencies in the past and can list all the reasons he was unhappy with each one. He’s had some incidents of overcrowding, so he installed a security camera on the front door so he can check on arrivals and is very detailed in how often and how diligently he examines the footage. He’s looking for a property manager who takes a significant security deposit because, in his recent experience, his claims have not been fully met. He employs his own cleaning team, who report to him every week with their opinions on each rental group and whether they were suitable for the property. 

The best recommendation for this type of owner is to run a mile. 

Joking aside, this business is not for everyone, and some homeowners are looking for income without bearing the responsibility that comes with it. Understanding the different personas allows us to select the ones who are motivated to succeed and will work with their property manager in a relationship-based way. 

 

About Heather Bayer

Heather Bayer is co-founder of The Vacation Rental Formula and host of the Vacation Rental Success podcast. She is also CEO of CottageLINK Rental Management, a property management company based in Ontario, Canada. She will be speaking at the VRMA National Conference in Orlando and at VRSS18 in San Antonio in May. 

 

7 Trainer Tips on Using Technology for Authentic Guest Engagement 

By
Doug Kennedy
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0

When vacation rental (VR) managers walk down the aisles of industry trade shows, such as VRM Intel Live! or VRMA’s annual and regional conferences, they are sure to encounter vendor partners offering the very latest in innovative, technology-based tools that promise to improve and enhance guest experiences and, in most cases, reduce labor costs.  

Certainly, smart VR managers will take the time to fully investigate all offerings—due diligence that is recommended by the providers themselves as well as by me. Long-established processes and procedures for the VR industry, as for virtually all others in today’s world, are being constantly disrupted. Therefore, embracing change is absolutely necessary for your company’s long-term viability.  

However, simply using the latest technology-based tools in the same way your competitors are using them will not help you gain market share of either renters or owners. In fact, if not used correctly, many of these “solutions” may inadvertently degrade the relationship between the guest and the rental company by eliminating key touch points in the guest and owner experience. As a result, many of today’s VR guests don’t even know which company they actually rented from last time, and owners feel little if any connection to them.  

Yes, to stay abreast of the competition one needs to embrace the latest technologies, but it’s more important to use these tools in different ways to stand out from competitors. When considering innovations, think about how each one can be used to personalize the sales and service experience, not just how the tool can reduce labor costs and increase staff efficiencies.  

Here are some training tips for using high-tech solutions for old-school relationship building:

1. Use an auto-attendant to answer phone calls after hours and during peak times, but have sales calls answered by a live person whenever possible.

Cross-train all office staff to field incoming calls, answer basic questions, and properly transfer calls (using “call announce,” not “call screening”) when it’s necessary to send the caller to a rental agent.

2. Have an easy-to-use online booking tool on your website, but encourage phone calls by posting your number prominently on the home page and adding copy that says “Call our in-house reservations specialists right now.” 

Let callers know they are not going to reach an untrained agent at some giant call center. Make sure the phone number is easy to find when searching on a mobile device. Update on-hold messaging to reinforce the point that callers are holding for a knowledgeable, in-house staffer. Update after-hours messaging to commit to a quick callback the next day.

3. Offer virtual and 3-D floor plans, but train agents to “narrate the pictures.”

Often, guests who are already looking at images online while on the phone will ask your agents for their opinions. Without training, most agents will simply restate facts about the accommodation, such as square footage, number of bedrooms, and a list of amenities. Instead, train them to endorse the options callers are inquiring about (assuming it matches their stated preferences) and/or to use needs-based recommendations and suggestions. When speaking with callers who have not yet viewed images of recommended options, agents often coach callers on how to find a home and view images at the website. Instead, train agents to use screen-sharing tools such as join.me (which is free to use), and then they can easily show callers the images they want to present. 

4. Offer online chat, but when the chat is a booking inquiry, train agents to redirect guests to the voice channel if possible. 

When conducting on-site training, I often observe agents who field sales inquiries solely via chat, which wastes time and is not personalized. Instead, train them to say, “That’s a great question. Are you by chance by a phone so I can give you a quick call?” Even better, be among the first to embrace video chat! (Skype and FaceTime already offer this option.)

5. For e-mail inquiries, use an auto-responder, but train your agents to follow up proactively with personalized responses.

If a phone number is provided, train them to call the prospective guest and say, “I just had a few questions to help you find the best options.” Otherwise, they should at minimum send a personalized e-mail response. Rather than just using a template, they should start with a few sentences to paraphrase and restate details regarding the sender’s plans if they are described in the inquiry. Even better, if you really want to stand out from all your competitors who may receive a similar inquiry from the same prospect, train your agents to respond with personalized video emails. (Email me to request a sample and link to the only vendor who provides this.) 

6. Use a call- and lead-tracking tool, but train your agents to use an investigative sales process to uncover “the story” behind the caller’s vacation plans and to document these details in the comments field of the lead (if not booked) or in the PMS system if booked.

Then train agents to paraphrase and restate such details in their sales follow-up messages and when welcoming guests.  

7. Use keyless entry and remote check-in if they fit your operational model, but welcome guests personally.

Make sure your staff members take the time before they call to read the guest history in the reservation and to note any details regarding the guest’s vacation. Then they can use what they know in a personalized greeting or at least leave a personalized voice mail. (Example: “Greetings, Mr. Rodriguez! Just wanted to call to make sure your kids’ first trip to the beach is off to a great start this summer!”) It’s always a good idea to send a locally themed, locally sourced welcome amenity, especially if you are using the remote check-in model to help guests connect with your brand.  

Who Owns Your Data? Vacation Rental Technology Companies Weigh in on Renewed Concerns about Data Privacy and Usage.

By
Amy Hinote
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0

Last month, HomeAway reportedly contacted several software companies requesting “strategic partnerships” between HomeAway and software providers in which the software companies would share client data with HomeAway to be included in the pilot program for HomeAway’s new revenue management platform known as MarketMaker.  

A few days later, at RezFest, HomeAway’s Cliff Vars announced the launch of MarketMaker, which offers users competitive reporting and pricing tools. He also thanked CiiRUS and Streamline for partnering with the company to make this a solution for the whole industry, not just HomeAway users. 

As a result, Streamline CEO Carlos Corzo, wrote VRM Intel to emphatically clarify: “We don’t share data with other software providers or industry solutions without [our customers’] consent.” 

The discussions between HomeAway and property management system (PMS) providers prompted a renewed interest in the question, “Who owns your data?” 

We reached out to several PMS CEOs and company leaders to find out more about their policies and paradigms surrounding privacy and usage of the data being entrusted by vacation rental managers within the PMS. Although HomeAway Software and Kigo have not responded, Barefoot, CiiRUS, LiveRez, NAVIS, RealTimeRental, Streamline, and Virtual Resort Manager (VRM) shared their ideas surrounding data privacy.

We asked the following questions:

  • Should VRMs assume that their tech partners are protecting their data?
  • Should technology providers be required to disclose to clients all the ways in which their aggregated data is being used?
  • What are the potential implications of giving tech companies your data without understanding how they are using it? 
  • How important is it for VRMs to read and understand End User Agreements and Terms and Conditions?
  • Do you think we are beginning to or will see software companies seeking to monetize customer data?  

Should VRMs assume that their tech partners are protecting their data? 

Ed Ulmer, CEO, Barefoot: Yes. This is in our Barefoot Subscription License Agreement. It is the foundation of our partnership. 

4.1 Customer Data/Customer may upload and publish its own content to the Service. The parties acknowledge that all Customer Data used with the Service and the Barefoot Software and all data derived from such Customer Data is and shall remain the property of Customer. Barefoot has no right to use the Customer Data without written permission by Customer. 

Josh Parry, CiiRUS: Absolutely. The most crucial part of our service is providing a safe environment for our clients’ data. That means powerful servers, server redundancies, and confidentiality of the data. 

Tina Upson, LiveRez: At a minimum, managers should expect that their tech partners are taking every reasonable measure to secure their data. This includes storing their data in high-security data centers with regular backups, ensuring PCI-compliance, securing system logins, having user rights management built into the system, providing an easy way for managers to revoke access to employees, etc. 

Kyle Buehner, NAVIS: Yes. First, make sure it is clear in each of your contracts that you are the sole owner of the data, and that any use of your data by your tech partner is limited to noncompetitive purposes. Your data is highly valuable, and you should keep ownership of this asset very clear. Each VRM should also look to work with vendors who can clearly demonstrate their commitment to safeguarding your data from theft. 

Joe Testa, RealTimeRental: Yes, vacation rental managers should expect that their tech partners are protecting their data. We make sure to keep up with industry security standards to keep our client’s data safe. RealTimeRental is PCI compliant and utilizes SSL encryption, as well as maintaining a 24/7 firewall protection on our server environment. 

Carlos Corzo, Streamline: I would hope so. We spend a lot of resources and money to make sure that our VRMs are protected. To do this, we take advantage of external vaults that tokenize data and provide extra layers of protection. We also employ Amazon Web Services, which provides great tools for monitoring and identifying strange activity. Beyond that, to avoid potential problems from disgruntled employees sharing data with competitors, we keep logs of every single user transaction in our system, which allows us to define anyone who has run specific reports. This year, we started whitelisting IPs for system access and requiring tokens to connect through our API, while also employing a system configuration that puts critical data into servers that are not accessible without the proper access.  

To add one final layer of security, we also enforce a strict password policy, where passwords cannot be seen. They can only be reset. What is most surprising to me is that companies are not taking advantage of our double OAuth (Open Authorization) capabilities. This is something that all employees at Streamline have to use, and it takes security beyond just the password. While it may be an inconvenience, it is your data. You need to do anything you can to keep it secure. 

Pete Wenk, VRM: Absolutely. 

 

Should technology providers be required to disclose to clients all the ways in which their aggregated data is being used?  

Ed Ulmer, Barefoot: Barefoot has always been forthcoming in our agreements, and we have been clear since we started that your data belongs to you. We will always side with our clients about how and when they share their data. For example, we have an opportunity for our clients to share their information with the VRM Intel data analysis project. This will be shared on a by-client basis based on their interest. We strive to act only on our clients’ behalf. 

Josh Parry, CiiRUS: Yes. The technology provider should have nothing to hide. If the provider intends to use the client’s data for anything but internal analytics, it should be proposed in the contract. 

Tina Upson, LiveRez: All software companies should provide their users with guidelines about how their users’ aggregate data could be used. And, when they do use any aggregate data, these companies should be transparent about how they are using it. We use aggregate data for internal analytics to identify how we can better serve our partners, and even then it is accessible to only an extremely small group of team members. When an integration requires that we share a partner’s data, we’re extremely careful to limit that data to only what is needed to make the service function (and that data is only shared when the partner opts into using the service in question). We also carefully vet any and all integration partners, and for a variety of reasons we have decided to not work directly with certain companies.     

Kyle Buehner, NAVIS: Your data is a highly valuable asset of your company. I believe it is imperative that you understand and agree with your technology vendor about its uses, ownership, and protections. 

Joe Testa, RealTimeRental: Yes, it is very important for vacation rental managers to understand how their data is being used. 

Carlos Corzo: Streamline: Yes. If I were going to store a valuable asset, I would want to know all security measures taken by the facility. If someone does not want to disclose how they protect client data, I would be concerned about the strategies they are using.  

Pete Wenk, VRM: If I was a property manager, I would require that. 

 

What are the potential implications of giving tech companies your data without understanding how they are using it?  

Ed Ulmer, Barefoot: We have always felt that our clients have absolute control for overseeing their data. We are deep supporters of understanding who, what, and when other entities are accessing your data. Without this, there can be no relationship between a customer and a provider without the trust that an open relationship provides. 

Josh Parry, CiiRUS: The implications should be clear, provided you have read the agreement. 

Tina Upson, LiveRez: There’s a long list of potential implications. The real questions professional managers should be asking themselves are “Who stands to benefit the most from my data?” and “What potential reward would my software company have for sharing that data?” 

Kyle Buehner, NAVIS: The list of negative things that could happen is long and concerning (just talk to your insurance agent about a cybersecurity policy). The companies with which you choose to share your sensitive and valuable data should be companies you trust highly. It is also important to understand how your tech partner can contractually use your data. For example, no VRM would ever want to be surprised that the tech company they partner with actually competes with them and is using their data to market directly to guests or owners. 

Joe Testa, RealTimeRental: It is very important to trust the companies you decide to work with. Tech partners should have proper security measures in place and not share or sell client data with third parties without your permission to do so.

Carlos Corzo, Streamline: This is an interesting question. I have learned over the years that companies retain the right to use your data and sometimes claim ownership to the data. Streamline does not believe in using your data without your consent. As most of us know, there is often a correlation between vacation rental software and online booking engines. This is no secret, and these companies legally have access to clients’ data. Property managers need to do their due diligence and understand how their data is being used. If they don’t, many tech partners may be taking your competitive advantage and giving it away. As a property manager in Park City, I don’t want anyone to see or use our data. It gives us the tools to analyze the market and identify strategies from year to year. If someone has the ability to aggregate all the actual data in a market, it makes them extremely powerful. 

Pete Wenk, VRM: Loss of control of your inventory and the potential guest; potential for the VRM industry to relinquish booking to OTAs, as in the hotel experience of recent decades. 

 

How important is it for VRMs to read and understand End User Agreements and Terms and Conditions? 

Ed Ulmer, Barefoot: Vital to running a business. 

Josh Parry, CiiRUS: Extremely, extremely important. For instance, the activation agreement for CiiRUS is five pages of information neatly organized in regular-sized font. It is the least intimidating document in existence, but it still does not get read by all users. It is important to understand your pricing, available features, and terms. You are doing your business a direct disservice by disregarding these agreements and potentially getting yourself in a situation to fall out with your provider very quickly over something that should have been clear via the agreement. 

Tina Upson, LiveRez: It’s incredibly important for VRMs to not only read and understand their agreements but also seek clarification if they don’t understand something. That actually helps software companies better understand their customers’ concerns, resolve their issues, communicate more clearly, and sometimes even improve their agreements.  

Joe Testa, RealTimeRental: Very important. We have had user agreements for nearly eighteen years. In the early days, every property manager had them reviewed by their council. Today, I believe very few do that. 

Carlos Corzo, Streamline: This is becoming more and more crucial. I find myself signing contracts nearly every other day. Every contract goes through our Legal Department, and it is amazing what is discovered. I don’t know that anyone has malicious intent in this industry; however, we all know that data is power. At the end of the day, it is your data, and you need to be comfortable with who gets access to it.  

Pete Wenk, VRM: Things can be obfuscated in legalese, so it is vital to read and understand EULAs in the context of what is happening in our industry today. When making a purchasing decision, VRMs should consider the future and how language in the EULA might adversely affect their ability to control their inventory and data down the road. 

 

Do you think we are beginning to or will see software companies seeking to monetize customer data? 

Ed Ulmer, Barefoot: Yes.  

Josh Parry, CiiRUS: I really hope not. It is our job to sow as much trust as possible with our users, and monetizing their data flies directly in the face of that. I can’t think of any other major contemporary software platform that is currently doing this or would think of proposing this. I don’t think our property managers would let this happen! 

Tina Upson, LiveRez:  It’s already happening in the general tech space when you look at the ways some free online services leverage your data in selling advertisements on their platforms. In the vacation rental space, data is important for a lot of the same reasons. Your guest lists, owner lists, pricing data, etc. could all be misused by a company to either market directly to your customers (both guests and owners) or to use the aggregate data for a tool that they could then sell or use to influence market economics in their favor. It doesn’t matter if it’s the software company directly doing this, or if it’s the software company providing this data to a third-party it integrates with (or is associated with in any way). And while it’s important to read your agreements and contracts, it’s just as important to do business with companies you can trust. Because, who’s to say what really goes on behind closed doors? 

Joe Testa, RealTimeRental:  I think it is important for vacation rental managers to be aware of this trend in the industry. It is important that vacation rental managers use trustworthy tech partners.  Beware of certain tech companies that offer free services, because often these free services are a way for companies to collect data to sell. We do not monetize customer data, and takes the proper security measures to keep that information safe. 

Carlos Corzo, Streamline: This depends on the ultimate goal of a software company. There are many ways to get market data; however, it is no secret that software companies have access to the necessary data to make intelligent decisions. Our focus is on software and doing anything to help our PMs grow and be successful. If we were to use company data to our advantage, we would make sure to get approval from the customer. After all, it is your data! 

Pete Wenk, VRM: Yes, particularly in the case of the larger software companies. In our case, we will not attempt to monetize customer data. The customers’ data is, in our concept, strictly controlled by them, and we do not have any claim on it.  

Living in a World of 800 lb Gorillas: Convergence Drives Growth…and Opportunity 

By
VRM Intel Staff
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4

By Alex Nigg, Founder and CEO, Properly — The short-term rental industry is expanding rapidly. As Douglas Quinby of Phocuswright reminds us, our industry is increasingly converging with the hotel industry, and what used to be called “alternative accommodation” is becoming mainstream.  

Converging with an industry that’s seven times our size (as measured in available room nights) is great news and explains why our segment is expected to grow at 14 percent compared with traditional lodging, which is expected to grow in the low single digits. But it is also scary—our own industry had recently seen strong consolidation. As our industry converges with the traditional lodging industry, are we being catapulted into a world of 800-pound gorillas? 

 

Different Expectations 

Convergence means that our product is increasingly being compared with hotels. Guests expect the same level of quality—or more—than what they experience at hotels. While dynamic newcomers like Airbnb are selling new segments of guests on experiential travel, those guests expect unique accommodations and consistent quality. Heather Bayer, an experienced VRM and the writer behind Cottageblogger, tells readers that the days when guests bring their own sheets are long gone. As an informal show of hands at VRM Intel Live in Denver indicated, equally gone are the days when all guests arrive and leave on the same day of the week, adding complexity to the process. 

Today’s guests expect hotel-like quality, smooth processes, and quality amenities, and they also expect that the Wi-Fi works well and that their experience is built around their specific requirements, such as a list of great fishing spots, a cot for the toddler, a doggie bowl and bed for four-legged companions, and referrals to a great dive bar. 

 

An Impossible Task? 

This becomes an operational nightmare. Hotels deal with rooms that have been built for easy cleaning and where every component is standardized, they employ housekeeping staff that go from room to room, each two yards from the next, and a concierge in the lobby is equipped to cater to the guests’ every wish and desire. 

Meanwhile, what VRMs pull off every day is more akin to managing a hotel with 300 rooms where every room has a different owner, was built by a different architect, is cleaned by a different housekeeper, and is spread across the landscape. As the platforms (OTAs and distribution sites) continue to drive professionalization, growth, and traffic, the pressure mounts. 

 

The Platforms: Drivers of Growth, Necessary Evil, or Upcoming Epic Battle? 

As a key driver of both growth and professionalization, the platforms have done much good for our industry. But there are clouds on the horizon: as Steve Milo of Vacation Rental Pros has presented artfully and entertainingly at VRM Intel Live events, the platforms often fall short on accommodating a VRM’s day-to day needs or business model. Even if these “teething pains” can be worked out, it’s unclear whether a VRM’s interests are aligned with the platforms in the long term.  

As the country manager of a major listing platform told me privately, “Just a few years ago, the property manager was responsible for both marketing and day-to-day operations. These days, [the platforms] take care of much of the marketing and pay for it dearly, yet the VRMs are still getting the same commission. A battle over margins is likely on the horizon.” 

Also on the horizon is a battle over who owns the guest. As every platform has now adopted Airbnb’s per-transaction pricing, control of the guest relationship has become a more contentious topic.  

 

The Big Squeeze 

With the rise of the urban VRM, which typically prices at lower commission rates; Airbnb’s support of micro-VRMs; and emerging low-cost, unbundled models like Evolve, this is likely to increase competition for owners. And increased competition will result in lower prices and higher expectations. 

Is a big squeeze on the horizon for property managers? It’s in everyone’s interest to leave enough—arguably, more—money on the table for the owner. After all, the industry is still supply constrained, so it behooves everyone to get more of the millions of second homes not currently listed available for rental. The platforms need to start recouping some of their multi-billion dollar investments that drove much of the industry growth.

 

Comparing Cottage Industries 

Is the short-term rental property management industry well positioned to withstand that squeeze? It’s unclear. While the industry has seen a huge amount of consolidation, the consolidation has mostly been at the distribution level, where four players substantially control the global market (Priceline/Booking.com, Ctrip, Expedia/HomeAway, and Airbnb).  

Meanwhile, property management remains a highly fragmented industry. By our count, enterprise VRMs (those with more than 1,000 listings) collectively manage under 30,000 listings in the United States—that’s only 1.5 percent of the US market. 

We recently witnessed how much effort it took for a leading US VRM to schedule a meeting with a senior executive at one of the global listing platforms. For the listing platforms, the United States is today not the major battleground—Europe (the current market) and Asia (the future market) feature much more prominently. 

Our industry is supported by 400+ VRM vendors, plus an emerging ecosystem of add-ons—a fragmentation that rivals that of our own industry. And we all rely on a network of service providers that is just as fragmented as our own industry. These cottage industries combined may make easy work for the global platforms if their interests no longer coincide with ours. So, where is the good news? 

 

Finding a Competitive Advantage in Operations 

VRMs have a competitive advantage: they manage day-to-day operations for the listing and, as opposed to the platforms, own an exclusive relationship. Operational management of the listing is the most difficult part of the VR equation. On the other side, Simon Lehmann, formerly of Phocuswright, at VRMA (Europe) in Amsterdam, said building a brand is an exercise in futility for a VRM. If he is correct, day-to-day operational management of properties will become the key competitive advantage of property managers. 

The operational component is likely a key reason why this industry is dominated by local players: knowing the local ecosystem of suppliers has been a key factor in success, as is being close to the property and being able to locally manage the details. 

The platforms realize just how important professional operations are. Witness Airbnb’s purchase of Luxury Retreats early this year as an example of exercising more control over the product. And rumors persist that Airbnb will soon launch a “Select” brand, covering a much larger segment of its inventory for exactly that reason—marrying the uniqueness of short term-rentals with the consistent operations expected at hotels. This has also been the theme for well-funded newcomers Stay Alfred and Sonder. 

 

A Massive Greenfield Opportunity 

With an emphasis on professionalizing property operations, the outlook for VRMs is promising, and the upcoming fight over margins and market share may be a temporary struggle. If convergence into an industry seven times our size is the theme, then the outlook for the industry on the demand side is extremely lucrative.  

But for sustained industry growth, we need supply growth. And two key drivers of supply growth are intrinsically linked to operational excellence. The first driver is the millions of second homes that are not currently for rent. This is a massive greenfield opportunity. Those owners may be less focused on revenue and care more about the stewardship of their asset, their second home. If we can deliver peace of mind, operational excellence, and real-time visibility into how their property is being managed, we may unlock a significant portion of that latent supply. 

The second driver is slowing down the regulatory onslaught our industry has recently suffered. While operational excellence is no panacea, it can reassure nervous city councils; the tighter we run the ship, the more accepted and acceptable we will be. Whether this is pre-stay (vetting guests), during the stay (noise and occupancy alerts), or post-stay (having effective, consistent and scalable processes to address any problems), we are better positioned to minimize regulations. 

 

Combating the Bull in the China Shop 

Given the rapid growth of our industry, regulatory resistance was all but inevitable. The writing has been on the wall for Airbnb in its urban core markets for a while, and it is now spilling into traditional vacation rental markets. 

With its aggressive push into urban markets and awkward handling of the initial response, Airbnb attracted most of the early arrows. Not much love is lost in city councils around the world for a multi-billion California company that stepped into constrained urban housing markets like the bull in the proverbial china shop.  

Local property managers present a much friendlier face as they are grounded in their communities. Even more importantly, property managers contract for billions of dollars of local services. And because these services are provided by local sole proprietorships and small businesses, they touch an important local constituency. 

As an industry, it is critical for us to showcase the local impact we have. City councils won’t shed a tear for a billion-dollar, far-away corporation. But they will pay attention when they understand how STR regulation affects Jane the contractor, Bob the gardener, and Pat the housekeeper. Hotels spend 14–18 percent of their revenue on housekeeping. Assuming that our industry will spend 15 percent on local operational costs, that’s more than $2 billion in local spend per year. 

 

A VRM’s Crown Jewels: Scalable Processes and Great People 

To achieve operational excellence, which underpins our industry’s competitive advantage, we need consistent, replicable, and scalable processes. We may not be able to outcompete Booking.com or Expedia’s long-tail performance marketing, Airbnb’s brand marketing, or Ctrip’s access to new customer groups in the long run, but we can run circles around competitors by turning our local, on-the-ground operational experience into consistent, scalable, and replicable processes. 

In other words, our processes are our crown jewels, the key to our competitive advantage (and if we so choose, to scale). Personally, I’m still learning something new every day: just last week, a guest managed to incinerate a bowl of rice in the microwave so effectively that two rooms in the house suffered smoke damage. Never having dealt with this problem before, it was a first-time adventure for me. I’ve turned the response into a process, which is ready for when I (or anyone else) needs it next. 

Of course, processes are only as good as the people executing them. We need to spend just as much time on recruiting, training, motivating, monitoring, and delivering feedback to our partners on the ground.  

 

Tech as the Enabler: The Forgotten Stack 

Technology plays an important role as an enabler of processes and people. Our biggest investment needs to be in developing our people and fine-tuning and iterating on our processes. Technology is subordinated to that. Technology can help us capture processes and manage them deep into the field, and provide actionable feedback to our people—in that role, technology becomes core to our competitive advantage.  

Walter Buschta of Phocuswright gave an excellent overview of the VR tech stack at VRM Intel Live in Denver recently. Quite tellingly, the tech stack he described focused almost exclusively on the marketing side. But this is only half the story: the other part of the story is the forgotten operations tech stack. As operational prowess becomes more critical to the success of VRMs, this will be the stack to focus on. 

The key layer of the operational tech stack needs to enable process and people management—this is what VRMs spend 60 percent of their resources on, and it is key to their competitive advantage. But the operations tech stack shouldn’t and can’t live by itself: it needs to integrate with the core property management system (PMS).  

Conversely, the core PMS is unlikely to cover this function well: PMSs are fundamentally delivered as cloud-based web software. The operational tech stack needs to connect myriad outside providers and devices with the processes of the VRM. The common denominators are native apps and mobile phones first, and APIs second. This requires scale, such as platform needs, to connect anyone from Jane the contractor, and Pat the housekeeper to the smart home thermostat, the NoiseAware noise monitor, the PartyCrasher occupancy monitor, and the grocery or restaurant delivery…everyone—and everything—into one common fabric. 

 

Hardware and How To Make It All Scalable 

The last twelve months have seen exciting developments in hardware that can support VRM operations. Connected smart locks are making inroads into the consumer side of the market. This will hopefully help drive expenses down and accelerate acceptance. Point solutions are being developed for VR industry-specific problems (e.g., NoiseAware as a noise monitor and PartyCrasher as an occupancy sensor). 

But the problem with many of these solutions is that they are stand-alone solutions. VRMs must consider tying these solutions together into a common framework—a noise alert is of little use unless it attracts the attention of the on-call listing manager, and that listing manager knows what to do. Ultimately, process management and smart home device management must be tightly integrated into one infrastructure where all the pieces work seamlessly together. 

Perhaps most interesting is the tech battle over who gets to sell add-on services to the guest: the property manager via an app, the platform via its guest app (e.g., Airbnb); or the PM with a partner via an in-home device (e.g., Amazon Echo powered by Alexa voice control). 

 

The Tech-Enabled VRM: Developer or Integrator? 

“The tech-enabled VRM” has developed much excitement. The debate whether the term is more substance or marketing speak is valid. But the outlines of the tech-enabled VRM are becoming clearer: increasingly, they are smart integrators, as opposed to developing technology in-house. This was one of the insights from VRM Intel Live in Denver—even the enterprise-scale VR managers are moving away from in-house technology development. This makes sense: with ever more complex integrations, scale is required in technology development. At the current scale, the largest US VRM would have about a 0.1 percent share of the global market—certainly not enough to get to a viable scale for sustainable technology development. 

 

Software vs. Platform 

A final consideration is the difference between software and a platform. Software is implemented inside a company; a platform connects many participants across a fragmented industry. Given the fragmentation at both the VRM and service supplier level, a platform approach seems ideally suited for the short-term rental industry. Imagine a future where the entire industry collaborates on training and rating its service providers; where VRMs can efficiently schedule service providers; and where the key differentiator becomes the quality, breadth, and scope of processes and the effective management of our human resources—all enabled by technology. 

 

Conclusion: Industry in Rapid Transformation, Lots of Opportunity for the Well-Prepared 

“Alternative accommodation” is certainly becoming mainstream. And with an increasing percentage of distribution handled by four large global platforms, VRMs will have to get used to living in a world of 800-pound gorillas. 

It remains to be seen whether the gorillas will be friendly or threatening. There will likely be some skirmishes over margins and over who owns the guest. The current honeymoon where the platforms aggressively court VRMs in the battle for market share will end, at least in some geographies. Our urban colleagues in many cities are already seeing this. 

But on balance, VRMs have not been dealt a bad deck of cards. Where there is rapid change, there is opportunity. Operational excellence is one likely area where VRMs have a competitive advantage. Ironically, operational complexity has resulted in keeping our industry fragmented. Building on this competitive advantage will require attention to processes and people management—underpinned by technology as an enabler—and a platform approach. 

Technology platforms level the playing field for smaller participants. VRMs have the additional advantage of having an exclusive relationship with owners. In a world of increasingly professional managers who crosslist on many listing platforms, it makes sense for service providers to forge relationships with the exclusive manager of a property. 

The more VRMs can showcase operational prowess, deliver peace of mind, and inject real-time visibility into property operations, the more likely they are to unlock the millions of second homes that are not currently available for rent and truly grow the market. This will make for a bright future for those VRMs who prepare for the coming changes. 

 

About Alex Nigg 

Alex Nigg is the founder and CEO of Properly, an operations platform for short-term rentals connecting thousands of properties across North America, Europe and Australasia with their service providers. Nigg is a frequent speaker at industry events in North America and Europe. With his partner Tammi, he also manages vacation rentals in San Francisco, Seattle, and New Zealand. Prior to finding his passion for the vacation rental industry, Alex was a management consultant at Bain & Company, an entrepreneur, and a venture capital investor in Silicon Valley.  

 

Vacasa Raises $103.5M in Largest Funding Round in Vacation Rental Management History

By
Amy Hinote
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0

Vacasa announced today the company has raised $103.5 million in a Series B funding round led by Riverwood Capital, followed by New Spring Capital, along with past investors Level Equity and Assurant. This triple digit raise offers Vacasa a lengthy runway to test its model on a large scale.

The investment will be used for growth through acquisitions and organic market launches. according to CEO Eric Breon.

With 6,000 vacation homes under management and 1,600 full time employees, Vacasa is the second largest vacation rental management in the United States behind Wyndham Vacation Rentals. However, as Vacasa is expanding internationally, Wyndham is looking to unload its European vacation rental division.

Building a recognized brand in vacation rentals has proven to be difficult, and the industry has received recent criticism for not having brand standards. However, standardization will not be a focus for the new investment, as Breon is leading the company away from the idea of “brand.”

“A Hilton-branded vacation rental won’t mean anything to anyone,” said Breon. “It is all about brand standards, and brand standards are hard in this space. I don’t think brands are needed. [Guests] want to know what they are getting, but they are not looking for standardization. As long as everything functions as expected, it is clean, and it is what they thought, that’s all we need to do in this.”

Breon also indicated that the company will continue to utilize third party channels and OTAs as their primary source of bookings.

Looking to the future, Breon expects to see fast growth. “We are growing about 70 percent this year with a 50 percent growth in head count,” said Breon.

If Vacasa reaches their goal, within the year, it will become the largest North American vacation rental management company.

According to a press release, Ben Levin, co-founder and co-CEO of Level Equity, said, “It is exceptionally rare to see a business of this scale growing this quickly. Vacasa has almost tripled its revenue and unit count in the year and a half since we invested while significantly increasing their geographic and technology footprint, as well as growing their senior executive team and brand.”

Vacasa added Riverwood Capital’s Jeff Parks to its board. Eric Breon will remain CEO, and Bob Milne will continue to serve as COO. Co-founder Cliff Johnson will head up the international division, Colin Carvey was named Head of Growth, Tim Goodwin serves as CTO, and Christina Rosalie joined the team as Head of Brand.

OneRoofTop Founders Discuss Recent Acquisition by Cloudbeds

By
Amy Hinote
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1

Cloudbeds, San Diego-based provider of software and channel management for independent properties (hotels, hostels, inns, bed and breakfasts, campgrounds, vacation rentals, and more), announced it has purchased of OneRooftop. The details of the acquisition have not been released.

Formerly known as WebChalet, OneRooftop is a software solution and website builder for vacation rentals. The company had raised approximately $525k over the last two years. As a subsidiary of Cloudbeds, OneRooftop will continue to offer vacation rental software under its brand with access to myallocator, Cloudbeds channel manager; and the entire OneRooftop team has joined the Cloudbeds group, including lead developers and co-founders Chad and Sarah Brubaker.

“Last year, we started to evaluate integrations with third party channel managers, and we came across Cloudbeds and their channel manager, myallocator,” said Sarah Brubaker. “Cloudbeds had grown quickly in the hostel and small hotel industry with beautiful, powerful software in addition to providing channel management for thousands of properties worldwide with myallocator. We were immediately impressed by Cloudbeds’ technology.”

Sarah added, “We were equally impressed by their team. Like ourselves, their founders. Adam and Richard, were UC Berkeley grads and entrepreneurs. After meeting a few times, we immediately saw that our business vision and company culture aligned perfectly with theirs.”

The OneRooftop team will bring their vacation rental know-how to accelerate Cloudbeds development efforts to provide an all-in-one solution for vacation rentals, allowing Cloudbeds to be one of the first hospitality software providers to accommodate hybrid inventory (both vacation rental and hotel inventory). Cloudbeds clients will also be able to leverage the two-way connection to Airbnb and HomeAway.

“We are proud of the product that we have built and equally proud of our agile, nimble team that has made it possible,” said Chad Brubaker. “Moreover, we believe Cloudbeds can take vacation rental software and distribution to a new level. Independent property operators and managers are the future of hospitality.”

According to Cloudbeds CEO Adam Harris, “We have been watching the incredible growth of vacation rentals for a while. Property managers need access to professional tools that will allow them to compete effectively in more established hospitality distribution outlets. We can’t wait to help them do this.”

In June 2017, Cloudbeds raised $9 million in Series B funding led by PeakSpan Capital. The financing follows 2016’s Series A round of $3.14 million, bringing the total investment to date to $20 million.

With the combined teams, the technology is expected to develop faster with more features and more channels available to vacation rental customers. In addition, Cloudbeds recently added Sebastien Leitner as Director of Global Partnerships where he will develop the growing network of strategic partners. Previously Sebastien was Director Distribution Accounts at Expedia.

HomeAway Addresses Questions About Its New Revenue Management Tool

By
Amy Hinote
-
10

Expedia-owned HomeAway recently launched its revenue management tool, MarketMaker, that allows vacation rental owners and managers to compare pricing with other homes listed on HomeAway’s sites and to accept pricing suggestions offered by the largest online marketplace for second home rentals.

In response to the article, which introduced HomeAway’s new revenue management tool, “HomeAway’s New Revenue Management Platform is the Latest Industry Disruptor for the Fast-Evolving Vacation Rental Industry,” Tina Weyand, Chief Product Officer at HomeAway, helped us to clarify key points about its latest product launch.

 

What is the objective for MarketMaker, and how does MarketMaker help Expedia maximize corporate revenue? Owner revenue? PM revenue?

Tina Weyand, Chief Product Officer (TW): Simply put, our new MarketMaker tool for revenue management was created to help property managers make important data-driven decisions to maximize the revenue and occupancy potential of their properties.

  • HomeAway’s success is tied to the success of its property managers and owners. Offering them the best tools and insights to achieve their goals benefits everyone.
  • MarketMaker does not take a cut of a property’s booking revenue.

 

You said that owners and managers can set preferences for degrees of pricing (i.e. maximize occupancy vs maximize rate). How does that work? 

TW: MarketMaker allows property managers to adjust their own strategies to maximize occupancy or revenue, set rates down to the property level, and stay aligned with their revenue and occupancy goals. [The following] screenshot shows you how this dynamic tool allows users to adjust their strategy.

 

How does your platform differ from Airbnb’s SmartPricing?

TW: Historically, vacation rental managers have relied on tools that provide pricing recommendations based on static, incomplete data and without providing the full context of the data that powers those recommendations.

MarketMaker provides a holistic view of all the major factors (in addition to pricing) that determine a property’s potential. This product is different because it:

  • Provides access to insights our partners cannot get anywhere else, pulling from real-time traveler behavior data combined with a market’s overall demand and occupancy data.
  • Gives users the ability to easily identify and track competition in the same market.
  • Allows users to set revenue and occupancy strategies at the property level and view data and opportunities for multiple properties in one convenient dashboard.
  • Alerts users to opportunities for higher revenue and occupancy.
  • Displays information about local holidays and events that may affect local demand.

Also, the HomeAway dashboard complements MarketMaker by offering a side-by-side comparison of competing properties to reveal what factors other than pricing (like amenities, reviews or photos) may have influenced travelers’ booking decisions.

 

The Vacation Rental Managers Association (VRMA) is trying to create a comparative reporting tool. Are you working with them to do this? Will VRMA’s efforts impact HomeAway’s MarketMaker initiative?

TW: HomeAway built MarketMaker from the ground up based on what our partners told us they most need to be more successful. There’s nothing quite like it on the market today.

For the moment, we don’t have plans to partner with VRMA.

 

In search and sort, will acceptance or dismissal of pricing recommendations affect ranking? 

TW: The tool’s suggestions are designed to help meet property managers’ unique goals for their vacation rentals. There is no direct relationship between accepting or dismissing MarketMaker feedback and a property’s rank in search results. As a reminder, the best way to improve a property’s rank is to adopt a few best practices: having great content in your listing, setting competitive rates, accepting and honoring bookings, and being given excellent feedback based on positive guest experiences.

 

Will “Offer Strength” be introduced to the search/sort algorithm?

TW: Yes.

Read more about Offer Strength. 

 

Are you partnering with other software companies to use their customer’s data in this tool? We heard that partnerships with Streamline and CiiRUS were announced. Are they providing aggregated data or data on a by-client basis?

TW: Bookings that take place on HomeAway or Expedia, including those supplied by HomeAway Software partners and property managers, are a part of HomeAway’s dataset about what’s happening in the market. We use this type of trending data to drive tools like MarketMaker and generate real-time insights for our property managers and homeowners.


Do your pricing recommendations include your service fee?

TW: Potential rate changes that appear in MarketMaker feedback are for the rental amount only – they do not include fees or taxes.

 

Is the acceptance of pricing suggestions being pushed pack into the PMS (property management software)?

TW: Property managers who use MarketMaker can choose whether to adjust their rates or ignore the tool’s feedback. Currently, MarketMaker does not sync with third-party property management software to auto-populate any pricing recommendations that the property manager decides to accept.

Pricing feedback generated by MarketMaker is for the rental amount only and does not include fees or taxes.

 

HomeAway said that MarketMaker is better than anything on the market. Does that include the market intelligence products (i.e., Everbooked, Destimetrics (Inntopia Business Intelligence), LSI, Transparent, et.al? Or the revenue management platforms (Beyond Pricing, Wheelhouse)? What makes it better?

TW: MarketMaker puts power into the hands of property managers by providing them with insights pulled from billions of data points so they can: set strategies down to the individual property level, find opportunities for higher revenue and occupancy, identify and track competition, and save time by viewing information all in one place.  

 

Is the pricing recommendation engine live? What rate of adoption do you expect? 

TW: We just launched the beta for this product last week at RezFest and many property managers enthusiastically signed up for pre-orders. The excitement we’ve seen for the product so far has exceeded our expectations. We hope to formally launch the product by the end of the year.

Who is the next disruptor in the vacation rental industry?

By
Amy Hinote
-
17

Travelers have been staying in vacation homes for centuries, but it wasn’t until the emergence and disruption of VRBO.com and Airbnb that the industry became a mainstream lodging alternative. According to Phocuswright, 32 percent of U.S. travelers reported staying in a private home in 2015, up from 8 percent in 2010. This triple-digit growth has attracted attention from the entire travel sector, as evidenced at the Skift Global Forum last week in New York, during which every hotelier and OTA CEO addressed the subject of vacation rentals.

Vacation rental managers and homeowners have been battling—and, arguably, profiting from—disruption for the last eighteen years.

When VRBO.com was founded in 1999, homeowners in traditional vacation destinations (beach, mountain, lake, and theme park-oriented locations) found a marketing channel to reach a mass audience of travelers and no longer relied on professional property managers for bookings. In 2008, Airbnb was created, and by 2011, the company had become a global powerhouse initiating a cultural shift in travel and a marketplace for shared lodging options and privately-owned urban accommodations.

Since then, the vacation rental industry has experienced fast growth and consolidation with Expedia, Priceline, Airbnb, and TripAdvisor taking early leads by acquiring vacation rental channels and competing for market share in this rapidly-evolving travel sector. In addition, metasearch platforms and multi-destination vacation rental management companies are emerging and expanding, backed by millions of dollars in venture capital funding, with hopes of creating big-brand names for privately-owned accommodations.

Even with consolidation, the vacation rental industry is ripe for disruption.

Consumers still find it incredibly difficult to search for and book vacation rentals. Moreover, homeowners and managers experience friction using the latest marketing channels, property managers are challenged with scaling operations across destinations, and the industry has yet to adopt standards that rival the hotel and cruise industries.

Consequently, hoteliers, OTAs, and investors are chasing the next source of disruption in the fast-growing industry.

Where are the gaps and friction? In all phases of the transaction between the homeowner and the traveler, friction, gaps, imbalanced distribution of profits, and struggles with managing customer expectations still exist in the sector. Challenges and potential areas of disruption include:

  • Marketing Dependence
  • Booking Path Optimization
  • Brand Recognition
  • Scalability of Property Management Services
  • Standardization to Meet Customer Expectations

 

Marketing Dependence

Vacation rentals are largely privately owned and managed by local companies which possess little brand recognition. As a result, these owners and managers have been increasingly forced to rely on online marketplaces as a primary source of bookings, and the expense of using these channels in rising.

However, while vacation rental managers and homeowners are dependent on OTAs, OTAs are dependent on Google.

According to Skift, “Combined, Priceline and Expedia likely spent $5.8 billion on digital advertising in 2016… Assuming that a few percentage points of spend is on Facebook and a few is on other channels, we can estimate that around 70 percent of Expedia and Priceline digital ad spend went to Google. This would amount to just over $4 billion in 2016; this includes both AdWords and the much smaller metasearch part of Google.”

This spending on digital advertising translated to 33 percent of gross profit for the two travel giants.

 

Google travel executive Oliver Heckmann told Bloomberg that he has the tricky job of keeping online travel agents happy while building increasingly competitive services for consumers. These advertisers need Google as much as the Alphabet Inc. unit needs them, but he’s always mending fences.

“If I look at the industry, everybody is sort of collaborating and competing with each other,” he said, while dismissing concern about a larger threat from Google. “I want to get a margarita every time I have to clarify that misunderstanding.”

The current level of marketing dependence in the industry points to potential disruption. Vacation rental suppliers are spending 20-25 percent of their profits on digital marketing channels (including OTAs), and OTAs are spending a third of their profits on digital marketing.

If a new player can find a way to insert itself between search engines and bookings for vacation rentals, there is a significant margin up for grabs.

 

Booking Path Optimization

The vacation rental industry has not yet identified the best booking path for individually-owned vacation homes.

OTAs are forcing a booking path that mirrors the hotel booking process. However, in contrast to hotels, vacation rentals are a “considered purchase” (Defined as a more complex buying decision with a high degree of financial and emotional risk which requires more investigation and comparison prior to a transaction than booking a hotel).

OTAs have implemented processes over the last year to eliminate contact between the traveler and the homeowner or manager. These actions have caused an uproar among vacation rental owners and managers as the new process fundamentally changes how vacation rentals are sold.

On one hand, as a “considered purchase,” the rental traveler has more questions when booking a multi-bedroom home for a multi-night vacation than they do when booking a standardized hotel room; and owners and managers have a need to talk to customers to set expectations and convey critical information about the property.

On the other hand, many homeowners and managers are slow to respond to requests for information causing anxiety and difficulty for travelers. Each owner or manager who does not respond immediately to an email, chat, or phone call pushes the entire vacation rental industry further into the hands of OTAs.

The difference in the booking path between vacation rentals and hotels presents a challenge that, to date, has not found a solution.

 

Brand Recognition

OTAs have created a booking path that mirrors hotels—with one notable exception. OTAs still prominently display the hotel brand, while they have removed the brand name for vacation rentals.

Airbnb, Expedia-owned HomeAway, Priceline, and TripAdvisor have proactively taken bold steps to insert themselves between travelers and the homeowner or manager by masking customer information, becoming the merchant of record, and eliminating any mention of the brand name or homeowner.

The idea of creating a big-brand global name for vacation rentals was first attempted by ResortQuest. Through many iterations, the idea proved to be unsuccessful at the time.

Alex Nigg noted in his article, Fighting 800 lb Gorillas, in the fall issue of VRM Intel Magazine, “Simon Lehmann, formerly of Phocuswright, at VRMA (Europe) in Amsterdam, said building a brand is an exercise in futility for a VRM. If he is correct, day-to-day operational management of properties will become the key competitive advantage of property managers.”

The fact that no company has been able to build a sustainable, recognizable brand in vacation rentals does not mean it is impossible.

 

Scalability In Property Management

Several multi-destination property management companies are raising funds and attempting to consolidate supply into managed brands. These companies have the objective of decreasing the cost of management by implementing technology solutions and scaling processes. However, the vacation rental industry is difficult to scale. As evidenced by reviews, these companies are challenged with maintaining a high level of quality and cleanliness while scaling operations for several identifiable reasons.

First, these new companies are more willing to add inventory to their portfolios that other local companies have declined to service. Business development employees are incentivized by adding homes, not adding quality homes. As a result, the base level of quality is difficult to manage. Second, the multi-destination management companies are focused on technology and—at least in the short-term—are struggling to accomplish automation without sacrificing quality and service. In time, automated solutions will improve and adapt; but the process has been slow, and learning curve is steep. For example, a number of multi-destination companies sought to replace housekeeping inspectors with mobile photos taken by contracted housekeepers. Most soon discovered that mobile photos cannot replace an inspector in gauging cleanliness.

Scaling services for successful vacation rental management has not been perfected, and opportunities for disruption continue to exist in developing multi-destination processes that decrease expenses, maintain quality, and encourage guest loyalty.

 

Standardization to Meet Customer Expectations

The vacation rental industry has struggled to adopt meaningful standards for accommodations. In some vacation rental destinations in the US, homeowners still require guests to bring their own sheets. In many others—including some of the largest property management companies—linens are being washed in the home between stays by housekeepers without any attention to laundry safety standards. In kitchens, many homeowners leave food in cabinets and refrigerators and cleaning supplies in easy reach of children. The industry also does not having any exit postings or safety instructions, which make it vulnerable to regulations and attacks by hotel advocates and lobbyists. This lack of standardization offers an opportunity for industry disruption that has the potential to make or break the sector.

 

Who Will Disrupt the Industry?

In spite of the many challenges facing the industry, vacation rentals as a mainstream lodging alternative are here to stay. Where there is friction in the booking process, challenges with scaling operations, a lack of a strong brand, needless marketing spending, and a need for standardization, many opportunities exist to disrupt the sector. The one thing we can say with certainty, the evolving story of vacation rentals continues, and there is ample room for new players and solutions we have yet to discover.

Vacation Rental Managers and Owners: What is Your Brand Worth?

By
Vince Perez
-
0

The above question was asked to several veteran managers this week at a meeting I attended.  It is an uncomfortable question, one that produces much thought, emotions and there is only one answer.

The actions of the past two months have been telegraphed  for years.  HomeAway has been very transparent in their plans and now they are executing.  The results has been anger on the part of the owner / managers and confusion on the traveler side. There is no longer any transparency to the vacation rental traveler when it comes to your brand.

Understand Centralized Platforms

All advertisers are now centralized booking platforms….embrace it, use it wisely and don’t become dependent on it.  Make them earn every booking.  This will cause some owner managers to raise their prices while these platform aim to drive it down.  Guess what happens when they move to commissions only?

Treat Your Business Like a Stock

70% of the value of your company is directly correlated to your brand.  Your brand is no longer visible to the traveler.  It is imperative that you treat your business like you would your stock portfolio by diversifying your distribution and making investments in “tools” that drive value back to your brand.  If you think these tools are found in all-in-one property management systems, you are sorely mistaken.  Many are no longer aligned with your business interest.

Building a Retention Strategy That Rewards Your brand

Decoupling marketing data made sense to our business five years ago…makes it even more compelling today.  If you are sitting on a closed property management system you know exactly the predicament you face.  Your ability to retain guests is directly connected to how the traveler connects with your brand.  The OTA’s and some Property Management Systems know going to centralized platforms will slow down leakage.  You need alternative routes to display your brand and connect with these travelers. There are many tools available out there to promote your brand, from Social Media to Newsletters to regional sites that work in your best interest.

Leverage Community and Content

Owner /Managers looking to build consumer habits should remember that monetization is a result of engagement — not necessarily the other way around.  Be it a financial services firm, a real estate agent, or a seasonal business, buying the product or service might not be a habit — but creating related habits around content and community can pay off in reputation, satisfaction, and more bookings.

  • Owning a guests habit is an asset that pays you.
  • Acknowledge this is difficult and commit to a strategy that captures these habits.
  • Focus on getting the traveler to engage your brand…not a reason to disengage.
  • Leveraging content and  community are two ways to keep the traveler engaged.
  • Monetization is a result of engagement — not necessarily the other way around.

What is Your Brand Worth?

What someone will pay for it.  If they are unable to determine the value of your brand this decreases the value of your business. For those of you who have been in business for years, this is a golden opportunity to invest in your brand for the long haul. For those that are just starting out…..start right.

Travelers are looking for your brand…you might want to help them find you.

 

VRHP Joins with VRM Intel for Fall Education in Gatlinburg, November 6-8

By
Amy Hinote
-
0

The Vacation Rental Housekeeping Professionals Annual Conference and VRM Intel Live! are joining together in Gatlinburg, Tennessee, November 6-8, to host a special vacation rental community event focused on the needs of professional vacation rental providers. With an educational lineup that includes industry leaders, management professionals, and property care and operations experts, this conference is set apart by its emphasis on the hands-on management and marketing of vacation rentals.

The two organizations chose Gatlinburg as their venue to show support for the area one year after the fires that decreased vacation rental inventory by over 15 percent. As the vacation rental industry knows all too well, perception is often the most challenging barrier to attracting tourism after a disastrous event, and VRHP and VRM Intel wanted to highlight that Gatlinburg is open for business and continues to be a premier destination for year-round mountain travel.

“We have worked hard to combine this year’s best education with truly special networking events to revive the idea of a conference created solely for vacation rental managers,” said Amy Hinote, founder of VRM Intel. “The content is laser focused on the needs of property managers without the overwhelming influence of OTAs we see at other conferences. Plus, we have planned unique social events designed to bring together attendees in a fun and lasting way. Gatlinburg is one of the largest vacation rental destinations in the United States, and our events are designed to spotlight its uniqueness.”

Registration is $399 and includes attendance to the reception on Monday, breakfast, lunch and all sessions on Tuesday and Wednesday, and the Bluegrass Hoedown Dinner on Tuesday Night at Ober Gatlinburg. Immediately following the sessions on Wednesday, attendees are gathering for the Gatlinburg Winter Magic Kickoff, just steps from the Convention Center, for a downtown celebration and the ceremonial lighting of more than 3 million lights throughout the city.

 

Schedule

  • Monday, November 6, 6:00 pm, Welcome Reception, Gatlinburg Convention Center
  • Tuesday, November 7, 8:00 am – 5:00 pm, General and Breakout Sessions (Including Breakfast and Lunch), Gatlinburg Convention Center
  • Tuesday, November 7, 6:00 am – 9:00 pm, VR Bluegrass Hoedown, Ober Gatlinburg
  • Wednesday, November 8, 8:00 am – 4:00 pm, General and Breakout Sessions (Including Breakfast and Lunch), Gatlinburg Convention Center
  • Wednesday, November 8, 5:00, Gatlinburg Winter Magic Kickoff, Downtown

Click here for the agenda.

General Sessions

  • Book of Excellence: True Growth—Simple insights on How to Live and Lead with Authenticity with best-selling author, Byrd Baggett
  • The Rebuilding of a Destination with Gatlinburg Convention and Visitors Bureau CEO, Mark Adams
  • The Real Truth of Working with OTAs – Unfiltered and Updated with Steve Milo
  • Best Practices in 2018 Housekeeping and Maintenance with Steve Craig
  • Where the Vacation Rental Industry is Heading with CEOs, Tim Cafferty, Miller Hawkins, Steve Milo, Jodi Refosco, and Clark Twiddy

 

Management Sessions

  • Keys to Leadership and Management with Byrd Baggett and Michelle Marquis
  • Skipping Over the Pitfalls in Changing Property Management Software with Doug Macnaught
  • Data 101: An Introduction to KPIs and Independent Reporting with STR Global
  • Data 102: Business Intel for Vacation Rental Managers with Amy Hinote
  • Stronger Together: Leveraging Your Sphere of Influence with C.J. Stam and Tina Upson
  • Property Care Trends and Technology with Jeremy Gall
  • Facing the 800 lb. Gorillas with Alex Nigg
  • The Tech Enabled Vacation Rental Manager with Alan Hammond, Clark Twiddy, Steve Milo and Jason Sprenkle
  • Credit Card Processing, Travel Insurance and Smart Home Updates, Panel
  • Finding New Revenue Streams, Panel

 

Marketing Sessions

  • Managing an In-house Marketing Department with Katrina Murray, Tybee Vacation Rentals
  • Increasing Website Conversion Rates with Brandon Sauls, ICND
  • Will History Repeat Itself with Michelle Marquis, NAVIS
  • The Universe of Digital Property Display with Brianne Pope, TruPlace
  • Lead Acquisition and Conversion with Matt Renner, TRACK
  • Online Marketing Strategies with Joe Joyce, Bluetent
  • Email Marketing Workshop with Heather Weiermann
  • 2018 Marketing Strategies with Matt Bare, Q4 Launch

 

Housekeeping and Maintenance Sessions

  • Round Table Discussions: Housekeeping, Maintenance and Operations
  • Guest Service Training for Housekeeping Staff with Jodi Refosco
  • Setting Up Piece Rates with Durk Johnson
  • Creating and Managing Budgets and Financial Statements
  • Linen Life Expectancy and Different Types of Linen (Show and Tell)
  • The Cost of Disengaged Employees with Sue Jones
  • Building an In-House Laundry Facility with Joe Refosco
  • Generating Income for Your Housekeeping Department with Steve Craig
  • Sustainable Products and Green Certifications with Durk Johnson
  • Housekeepers: Guardian of the Brand with Tim Cafferty
  • Q&A: What is on your mind?
  • Second Annual Housekeeping Survey Results and Q&A with New Executive Housekeeper of the Year

Click here to Register.

 

Sponsors

  • Breezeway
  • Red Sky Travel Insurance
  • LiveRez
  • Xplorie
  • aBundle
  • American Associated
  • Ascent Processing
  • Beach House Logos
  • Blizzard
  • Bluetent
  • Clean Connect
  • CSA Travel Protection
  • Dorma Kaba
  • ICND
  • Kemper
  • Lexicon Travel Technologies
  • Liberty Linen
  • LSI
  • My Booking Pal
  • NAVIS
  • Point Central
  • Q4Launch
  • RealTech Webmasters
  • Real Voice
  • Red Awning
  • Silicon Travel
  • SmokyMountainsByOwners.com
  • Streamline
  • Track with ResortsandLodges.com
  • TruPlace​
  • Virtual Resort Manager
  • Weatherby Consulting

Vacation Rental Options Minutes from VRMA National Conference

By
Dan Kline
-
0

The Vacation Rental Management Association (VRMA) National Conference is set to kick off October 15-18 in Orlando, FL at the Omni Championsgate Resort. Over 1,500 vacation rental professionals are expected to come together for education, networking, and to learn about the recent changes in the fastest growing segment of travel.

If attending the conference with more than one person, your group is likely to find a better value–and a better experience–choosing a vacation rental for your accommodations. Below you will find ideas for alternative lodging choices within minutes of the hotel for your group at fantastic rates.

Current nightly rates at the Omni for the conference are starting at $219 per night plus fees. What can $219 per night, per room budget give you in a nearby vacation rental? A lot! We reached out to a few professional vacation rental companies to see what they had available. Here’s what we found:

Global Resort Homes offers townhomes and vacation homes at Champions Gate starting at $190 per night. We found a new 6 bedroom, 6 bathroom home with private pool for a rental rate of $383 per night. Plus, they are giving attendees a discount of 30 percent (that makes a per room nightly rate only $44). To receive their discount, phone their reservations department at 877-582-9865 and use the code: VRM.

Reunion Vacation Homes has available luxury condos and huge vacation rental mansions at Reunion Resort. We located a 10,000 S.F. 12 bedroom, 12.5 bathroom vacation home with a resort style pool for a nightly rate of $1,395. Reunion Vacation Homes is offering a 15 percent discount to VRMs, which makes the nightly rate per room just $99. The discount is available by phone or web using the VRM promo code.

Magical Vacation Homes has vacation rental options in both Champions Gate and Reunion Resort. We discovered a great Champions Gate rental option that includes 8 bedrooms and 5.5 bathrooms for a nightly rate of $325. They are offering a 15 percent discount for last minute reservations, bringing the nightly rate per room down to $35.

We all know the value and comfort vacation rentals bring to travel, and Orlando has no shortage of options within minutes of the conference venue. It’s not too late to book a vacation rental for the VRMA National Conference.

HomeAway’s New Revenue Management Platform is the Latest Industry Disruptor for the Fast-Evolving Vacation Rental Industry

By
Amy Hinote
-
6

Today, at its software user conference, Expedia-owned HomeAway launched a revenue management and pricing platform, MarketMaker. With MarketMaker, vacation rental owners and managers are able to compare pricing with other homes listed on HomeAway’s sites and to accept pricing suggestions offered by the largest online marketplace for second home rentals.

HomeAway’s creation of this revenue management system is the latest industry disruptor in the rapidly evolving vacation rental industry.

The ability to recommend rental pricing to vacation home owners and managers—and to automate and incentivize the acceptance of its pricing suggestions (while accounting for HomeAway’s “service fees” for customers)—potentially gives Expedia-owned HomeAway the freedom to dictate market pricing.

 

Sort Algorithms Based on Discounted Pricing

Expedia incorporates a metric for lodging sort (how high a property appears in a customer’s search results on the site) known as “Offer Strength.” For example, a property with a published nightly rate of $400 per night—that has dropped its pricing to $250 per night—will appear higher in search results than a property with a published nightly rate of $300 per night that has dropped its price to $250 per night, all other factors remaining equal.

As Expedia looked to replicate its pricing and sort strategies for the vacation rental industry, it became increasingly apparent to the company that HomeAway needed to find a way to adjust pricing for less sophisticated managers and homeowners.

As a result, HomeAway’s MarketMaker was born.

 

Airbnb’s Pricing Suggestion Tool: Smart Pricing

Airbnb has a similar, yet less advanced, tool. Airbnb’s Smart Pricing lets owners and managers “set your prices to automatically go up or down based on changes in demand for listings like yours.”

However, forums are filled with hosts claiming Airbnb’s “suggested pricing” pushes pricing down to unreasonable levels. For example, reportedly, oceanfront three-bedroom homes have “suggested” pricing of $47 per night. $700 per night homes are being asked to drop pricing down to $80 per night. A quick search on Google yields hundreds of examples of the bottom-basement pricing suggestions being promoted by Airbnb.

Most managers and owners do not utilize Airbnb’s pricing tool, as it is known to suggest pricing for properties that is well below acceptable thresholds.

 

Why HomeAway’s Revenue Management Tool is a Disruptor While Airbnb’s Tool is Not

Unlike Airbnb, HomeAway owns the software utilized by over one thousand property management companies, many of which manage upwards of five hundred homes. Through its revenue management system, HomeAway can automate pricing and push that pricing back into the software which feeds into many more marketplaces.

In addition, thousands of vacation homeowners and management companies in traditional destinations are dependent on HomeAway for bookings. With the creation of this pricing automation tool, HomeAway has an unparalleled power to influence pricing throughout the industry.

 

The Race for Market Share among OTAs

HomeAway, Airbnb, and Booking.com are in a race to increase market share and to establish a dominant position as the leading vacation rental marketplace. As the hotel industry experienced, OTAs know that they can “win” by offering customers the best price.

The creation of pricing automation tools is the avenue that allows them to achieve this goal.

 

The State of Revenue Management for Vacation Rentals

As vacation rental managers are witnessing, many revenue management services have emerged to provide automated revenue management services. But all are not created equal. Some of these services are working directly with managers and owners to create hands-on processes for optimizing pricing while others are using scraped data to automate a pricing model that is untested.

In the hotel industry, hundreds of revenue managers—actual people—are employed to optimize and daily adapt pricing strategies. Their craft is based on years of experience, independent data, internal data, and monitoring consumer behavior.

In the vacation rental industry, we are seeing companies, including HomeAway and Airbnb, rush to automate pricing strategies that are have not been tested.

To use an analogy, it is like a company building a car wash when the builders have never washed a car.

Implementing poorly crafted revenue management strategies can cause genuine harm.

If the owner or company prices too high, they lose bookings. If they price too low, they leave money on the table and sacrifice their ability to book at a market rate in the next year.

As one manager noted, “We don’t have proven processes yet. There is a reason that hoteliers use revenue managers—even with OTA data and STAR reports.”

 

Making the Case for Independent Reporting

If HomeAway or Airbnb is successful in achieving widespread adoption of pricing control, the vacation rental industry will see a shift in market pricing.

For far too long, vacation rental managers have been reliant on poor market reporting. Savvy vacation rental managers expend hours of staff time each week to scrape competitors’ websites to get an idea of pace, rates and overall business performance. Less sophisticated managers rely only on past performance to make rate decisions.

The hotel industry has access to the STAR report, produced by STR Global, which provides basic, independent benchmark reporting metrics that provide hoteliers and their revenue managers with the necessary information to make pricing and marketing decisions.

For hoteliers, the idea of making pricing and marketing decisions without independent data is unimaginable. However, vacation rental managers have not had access to benchmark reporting in making pricing and marketing decisions.

 

Keeping Them Honest

At VRM Intel, we’ve built independent, unbiased benchmark reporting for vacation rental managers. This reporting allows property managers to compare their key business metrics to the market. This real-time tool serves as a fact-checker for the pricing suggestions dictated by HomeAway and Airbnb. We believe independent reporting can save managers from relying on OTAs for market reporting and protect the industry from a needless race to the bottom in pricing.

Note: As STR Global, the provider of the STAR report, has proven, a reporting company that provides revenue management services cannot provide independent data. If managers give their data to a reporting company that provides revenue management services, their company’s data is being used to help their competitors succeed.

 

The Urgency

As HomeAway and Airbnb compete for market share via discounted pricing, the vacation rental industry has an urgent need for access to unbiased, untainted, affordable, forward-looking reporting. However, market-wide independent data doesn’t happen overnight. In order to combat the OTAs endeavors to dictate pricing, like hoteliers, vacation rental providers are likely to find it advantageous to align with an independent benchmark marketing provider that is dedicated to industry independence, growth, and sustainability.

HomeAway to Sponsor “Vacation Rental Potential” TV Series on A&E

By
Amy Hinote
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2

Today at its user conference, HomeAway announced it is sponsoring an upcoming TV series titled “Vacation Rental Potential.” The series will be produced by Chicken Soup for the Soul Entertainment, Inc. (CSS Entertainment), and will be distributed on A&E. The premier date has not yet been released.

The series will feature twelve homeowners/property managers in twelve locations. The working title was “Paycation Homes” and, according to CSS Entertainment, will give viewers the information and inspiration needed to realize their dreams of using real estate entrepreneurship to obtain financial success.

Matt Landau of VRMB is also rumored to be producing his own digital series entitled, “A Sense of Place,” in which viewers meet unique destinations of the world through the eyes of professional vacation rental managers. First episodes are slated for this October.

These productions are designed to increase awareness of the value and experiences vacation rental accommodations offer over and above traditional hotels.

The last TV series featuring vacation homes was “Getting Away Together,” produced by PineRidge Film and Television and distributed on PBS. The series was first sponsored by Discover Vacation Homes and later by the Vacation Rental Managers Association (VRMA) and various destination marketing organizations.

While Getting Away Together brought the concept of “togethering” to television to promote vacation rentals, HomeAway’s Vacation Rental Potential focuses on the financial benefits of owning a second home.

$3M Lawsuit Against Vacasa Serves as a Warning for All Vacation Rental Managers

By
Amy Hinote
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67

Last week, an Oregon resident and vacation home owner filed a lawsuit against Portland-based Vacasa requesting class action status and seeking $3 million in estimated damages on behalf of herself and others. Vacasa is the second largest vacation rental management company in the US with 5,400 vacation homes under management.

The complaint alleges that Vacasa misrepresented its commission and fee structure “by charging renters additional amounts for their nightly use of properties, but not sharing any of such amounts with home owners, including, but not limited to: the ‘booking fee,’ ‘hot tub fee,’ ‘pet fee’ and ‘early check in/late check-out fees.’”

The Plaintiff is Barabara Fisher, a Portland resident who owns a cabin on Mt. Hood in Rhododendron, Oregon. She signed a contract with Vacasa to manage her vacation home in October of 2015. The complaint states:

“Vacasa is entitled to for its management services as 35% of the nightly rate charged to renters, multiplied by the number of nights rented. Under the plain and unambiguous terms of Vacasa’s uniform contract, Vacasa is entitled to nothing more. But Vacasa takes much more. It charges renters additional monies per night under the guise of ‘fees,’ which are in actuality nothing more than disguised rent that must be shared with Vacasa’s home owner clients. These so-called ‘fees’ include nightly pet fees, nightly hot tub fees, and fees for early check-in and late check-out, as well as a so-called ‘booking fee’ which is typically around 10% of the nightly rental rate. Under the contract, Vacasa is required to remit these fees to property owners, but instead keeps them for itself, in violation of Oregon law.”

Read the entire Class Action Complaint. (Courtesy of the Oregonian)

Vacasa maintains its contracts are clear. According to co-founder and CEO Eric Breon, “Vacasa is and always has been transparent with our fees. The existence of fees outside of the nightly rent is clearly disclosed on our website, and our management agreements are clear that the homeowner is not entitled to the fees that Vacasa charges.”

Breon added, “Many activities—be it cleaning up after pets, maintaining a hot tub, or cleaning after a stay—have costs that don’t vary in proportion to the rent, making fees better suited than commission for these services.”

 

Industry Implications

Most—if not all—US vacation rental management companies charge non-commissionable fees. Even Airbnb and HomeAway now charge “service” fees to guests.

Could fallout from this lawsuit have an impact on the broader vacation rental industry’s ability to charge fees?

“Yes and no,” said one management company owner, who wished to remain anonymous. “Yes, for property managers who have contracts that are ‘silent.’ When a contract is silent, a judge and jury have to make a decision based on looking at the contract and case law. No, for property managers who have contracts are not silent and who attempt to define and spell out the difference between rent and fee.”

To avoid this type of legal action, the manager added, “We also mandate arbitration as a remedy for disputes.”

The complaint outlines the following legal questions:

  1. Whether Vacasa enters standard form contracts with property owners;
  2. Whether Vacasa’s standard form contract defines its compensation as 35% of the nightly rental rate;
  3. Whether Vacasa charges renters additional monies on a nightly basis that Vacasa categorizes as “fees”;
  4. Whether Vacasa shares those alleged “fees”, in whole or in part, with its property owner clients;
  5. Whether Vacasa is legally required to share those “fees” with its property owner clients;
  6. Whether Vacasa has breached its contractual obligations to home
    owner clients;
  7. Whether Vacasa’s practices violate ORS 646.607-.608;
  8. Whether Vacasa is a “real estate property manager” under ORS 696.890;
  9. Whether Vacasa owes its home owner clients fiduciary duties;
  10. Whether Vacasa breached those fiduciary duties;
  11. Whether Vacasa breached the covenant of good faith and fair dealing
    inherent in every contract.

“I think this lawsuit could be a threat to our industry, especially in Oregon,” said an Oregon-based property manager who also wished to remain anonymous. “Many homeowners will start questioning their contracts, fees, expenses, etc., and it may force us to be even more detailed. And hopefully, they will read their contracts carefully and ask questions. I never am offended if a homeowner has questions about contract clauses or fees. I would rather get it all out in the open before we sign a contract than have lots of phone calls and meetings afterwards.”

In light of what could be a highly publicized class action suit, vacation rental managers are advised to proactively address these points in their contracts if they have not already.

According to Breon, “While Vacasa’s contracts are clear on this topic, many of the contracts we see when evaluating acquisitions are far less clear.”

Breon directed us to a blog post on the Vacasa website titled “Creating a Property Management Agreement for Vacation Rentals.”

Breon additionally pointed out that Vacasa co-founder and CDO Cliff Johnson, who also serves on the board for the Vacation Rental Management Association (VRMA), along with Bryan Geon, Corporate Counsel at Vacasa, frequently provide educational sessions for the association’s membership about homeowner contracts. Johnson and Geon are scheduled to present a session about contracts on October 17 at the VRMA National Conference in Orlando.

 

The Lawsuit Also Addresses Vacasa’s Revenue Management Activity

While the subject of fees is the primary basis of litigation, the complaint also addresses revenue management.

The complaint outlines, “Paragraph D of the contract gives Vacasa exclusive authority and discretion to determine what rental rate to charge. According to Vacasa, it has developed a ‘sophisticated rate optimization system that has proven to be the 2022 best replica watch perfectreplicawatches for sale most effective way to maximize vacation rental revenue.’ Vacasa touts this alleged ‘rate optimization system’ heavily in its marketing materials to owners, in media appearances, and on its website.”

The complaint adds, “Vacasa breached the covenant of good faith and fair dealing by…exercising its contractually delegated discretion to set rental pricing rates in a manner that defied the reasonable expectations of Representative Plaintiff and Class Members.”

 

Radioactive

One manager, who also wished to remain anonymous described the lawsuit as “radioactive.”

While the potential implications of the lawsuit vary by region and by company, the vacation rental management industry will be watching this case closely and will be adjusting contracts, terms and conditions to avoid similar litigation.

Managers And Owners Angry At HomeAway’s Changes, But Is It Fair?

By
Amy Hinote
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66

Vacation rental managers and homeowners in traditional vacation markets are up in arms about the many changes at HomeAway since Expedia’s purchase of the company in late 2015.

VRM Intel receives daily complaints from vacation rental managers and homeowners about HomeAway’s latest changes and actions, which are largely related to its decisions to: charge additional fees to guests, require online booking, mask customer data to eliminate direct communications between managers/owners and shoppers, remove all manager/owner information from listings to reduce “leakage,” and threaten to remove listings for perceived infractions of the new policies.

However, several HomeAway representatives believe the angst among vacation rental managers and owners is unfair, especially when compared to Airbnb.

After all, Airbnb also charges guests added fees, and it requires online booking. Airbnb also masks customer data and often removes listings for any perceived violations. In fact, all of HomeAway’s actions mirror those of their number one competitor, Airbnb.

And there is more to come. Airbnb employs pricing suggestion tools and automation (widely reported to push down pricing), and it standardizes contracts and cancelation policies, initiatives that Expedia-owned HomeAway is expected to launch over the coming weeks and months.

So why is HomeAway the recipient of so much passionate criticism while Airbnb skates by?

The answer is both simple and complex.

The simple answer is that, first, in traditional vacation markets (which include beach, lake, mountain, and Disney-oriented destinations), suppliers do not receive enough of their revenue from Airbnb to warrant such a response. Second, Airbnb didn’t change their policies. From the time that Airbnb began attracting suppliers in traditional vacation rental markets, their policies have remained consistent.

(We recognize that vacation rental managers and homeowners do not like to be referred to as “suppliers.” However, the OTAs consider managers and homeowners to be suppliers of the inventory that is available in their marketplaces, so forgive us for using the term going forward in the article.)

The more complex reason that HomeAway is being bombarded with upset suppliers is that its suppliers previously had a “relationship” with HomeAway. These owners and managers feel that they entered into—what they considered to be—a partnership with HomeAway (more specifically, HomeAway-owned VRBO.com). They paid a subscription fee to HomeAway and gave the company their inventory for the mutual benefit of increasing awareness and providing a two-way marketplace for vacation rentals. As a result, in what they thought was a trusting partnership with a company that valued their needs, suppliers obtained more bookings, HomeAway flourished, and vacation rentals as a lodging alternative became mainstream.

When Expedia purchased HomeAway, the game changed.

Suppliers felt duped.

 

History Lesson: VRBO.com was founded in 1996. VRBO.com was purchased by HomeAway in 2006. Expedia purchased HomeAway in 2015.

Expedia turned HomeAway’s listing sites into eCommerce platforms and fundamentally changed the way vacation rental managers and homeowners conduct business.

To take a deeper look, HomeAway’s supplier base can be divided into four distinct segments which have differing, yet equally infuriated, responses to the recent changes.

 

4 HomeAway Supplier Segments

 

1. Vacation Rental Homeowners

VRBO.com was a major vacation rental industry disruptor, as it provided homeowners—for the first time—the opportunity to promote and book their vacation rental homes to the mass market without the use of a property manager. In turn, the supply these homeowners gave the marketplace allowed VRBO.com to thrive. The partnership was a good one for both VRBO.com and homeowners. Consequently, homeowners placed all of their “eggs in one basket” with VRBO.com and utilized the site as their primary source of revenue. Through the VRBO.com marketplace, homeowners communicated with guests, screened out potentially disruptive parties, and set realistic expectations.

With the recent changes to policies, homeowners are no longer able to conduct personalized pre-stay communications and negotiations. In addition, the new “service” fees charged to guests have significantly increased the cost of bookings, have resulted in friction between the traveler and the owner and in many cases a substantial decline in bookings.

 

2. Vacation Rental Management Companies Founded Pre-2002

For vacation rental management companies founded before 2002, the disruption created by VRBO.com was significant. All of a sudden, homeowners had an outlet to market their own properties to consumers. These vacation rental managers found themselves competing, not only for inventory, but for guest awareness against HomeAway’s huge online marketing budget. This created a new segment of competition for professional property managers, a market-wide loss of inventory, and a push-down in market pricing.

In 2010, HomeAway purchased Instant Software, the largest software provider for these traditional vacation rental managers, which further entangled property managers with HomeAway and created a new layer of dependency on the company. After the software purchase by HomeAway, the company promised a “wall” between the software division and the distribution sites. In recent months, however, after Expedia’s purchase of HomeAway, that “wall” has come down, and property managers are just now beginning to experience the ramifications of Expedia’s use of their data.

 

3. Vacation Rental Management Companies Founded Post-2002

After 2002, a new group of vacation rental managers emerged. These managers began as homeowners, found marketing success booking through HomeAway/VRBO, and were able to build successful property management businesses by optimizing the marketplace and providing more personalized property care.

These companies literally grew up with HomeAway/VRBO and are especially reliant on their performance. For these companies, pulling their supply off of HomeAway is simply not an option, as it is their primary source of bookings.

 

4. The New Multi-Destination Vacation Rental Manager

As a result of the booking success of HomeAway, new multi-destination property management companies (i.e. Vacasa, Turnkey, etc.) have emerged with an above-average dependency on HomeAway as a primary booking channel. These companies have been able to flourish by leveraging HomeAway’s audience and have been more than willing to adapt to the company’s changes as they do not incur the additional marketing costs of using traditional or local marketing channels. However, these new companies are more susceptible to HomeAway’s changes than any other group. These companies are largely funded by outside investment, which gives them a short-term advantage in weathering changes. Yet with a decline in reservations generated by HomeAway, these new multi-destination companies face the immediate challenge of either finding new ways to get more bookings from HomeAway or attempting to replace these bookings through additonal channels.

 

Is the Supplier Push-back Against HomeAway Fair?

While it is true that Airbnb’s policies are no different, the resistance to HomeAway’s changes are felt much more closely to the wallet.

Airbnb dominates the shared-housing market and the short-term rental market in urban markets, but HomeAway accounts for the largest share of non-direct bookings in every traditional US vacation rental market. Any changes to the HomeAway model are felt immediately by their suppliers in these destinations.

In addition, many of HomeAway’s suppliers were able to build their property management companies and rental income based on their perceived “partnership” with the company. The reported decline in bookings generated by HomeAway decreases their ability to operate their businesses or—for homeowners—pay the mortgage on their vacation home.

 

But This Is How Hotels Work With OTAs. Or Is It?

When discussing OTAs and the vacation rental industry, experts often compare the hotel industry’s experience with OTAs. However, the comparison is far from apples-to-apples.

Here are some ways that hotels are better able to work with OTAs

  1. Hotel brands are prominently displayed on OTAs, while HomeAway has removed any mention of a vacation rental brand.
  2. Hotels have independent market data to keep OTAs from dictating pricing. HomeAway’s upcoming pricing tool and “Offer Strength” sort metric cannot be combatted without independent market data.
  3. Hotels have the ability to offer guests 24-48 hour cancellation windows. According to Jon Gray, ex-chief revenue officer for HomeAway, “The booking window for vacation rentals is typically ninety days.” In vacation rental markets where bookings are made an average of ninety days in advance, rebooking a vacant period caused by a cancellation made 24 to 48 hours before the guest’s check-in day is nearly impossible without offering potential guests heavy discounts and paying the high marketing cost of advertising that discount.
  4. Hotels do not have a need to communicate directly with guests. From the guest’s perspective, vacation rental shoppers often are looking for accommodations for up to 20 people in a party, have special needs, and need detailed questions answered. From the supplier’s perspective, accommodating for a large number of guests and setting the right expectations require direct communication with guests. It would be similar to hotels allowing instant online booking for meetings, weddings, and groups.

 

Will Suppliers Be Able to Sway HomeAway?

Expedia is accustomed to being disliked by its lodging suppliers and is not phased by the multitude of articles, blogs, forums, AHLA actions, and anti-OTA initiatives. The only strategy that will be efffective in swaying behavior at Expedia-owned HomeAway is for suppliers to remove inventory, and most of the supplier segments outlined above simply cannot afford to remove their supply from HomeAway’s sites. Expedia believes that, like hotels, vacation rental suppliers need them.

Yet a surprising fact is that, unlike hotels, in most traditional US vacation rental markets HomeAway only lists less than than 60 percent of the available inventory; and in many markets, HomeAway represents less that 40 percent of the vacation rental inventory. There is a slight possibility that vacation rental suppliers might come to the realization that OTAs need their inventory more than they need them.

Meredith Lodging Acquires Oregon Shores Vacation Rentals

By
Amy Hinote
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0

Meredith Lodging LLC, based in Lincoln City, Oregon, announced today that it has acquired Oregon Shores Vacation Rentals. This is Meredith Lodging’s fifth vacation rental company acquisition in the last two years and adds over 60 coastal properties to its vacation rental inventory, increasing its scope to include vacation rentals from Yachats to Pacific City.

Operating as a local family-owned business, Meredith Lodging currently employs over 100 staff members in Lincoln City, Newport, Neskowin, Pacific City, Portland, Seaside and Sunriver, and was ranked one of Oregon’s Fastest-Growing Private Companies for 2017.

“The new vacation homes add value and destination opportunities for the company’s 100,000 guests,” according to its recent release. “Meredith Lodging’s founders developed a business model on a foundation of value, quality, service and integrity focused on providing consistent, exceptional, white-glove lodging experiences. An experienced and creative management team handles day-to-day operations, providing superior customer service to guests desiring private, quality homes for their Oregon beach, mountain or resort vacation.”

With the state’s highest staff-to-property ratio, Meredith Lodging sets itself apart with an attention to local presence, a heavy focus on personalized property management, and a company-wide technology foundation with its adoption of advanced reservation software, search engine optimization, advanced rate algorithms, and 3-D technology to make homes and vacation opportunities easy for customers to find.

The company also manages several boutique vacation rental developments, including Beachfront Rentals, Seahaven Rentals, Sunriver Rentals and The Breakers in Neskowin.

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