“What is next?” This is the burning question we get from clients who are frustrated with the continued policy changes that are negatively impacting our industry. If you have not visited your HomeAway listing lately, do so, it is an eye opener. We always urge our new clients to take a moment to review one of their listings on each site they use, including calling the 1 800 number next to the listings. See how your “booking” process goes. Make sure it works.
The latest salvo is the announcement that HomeAway will hide the travelers emails and phone numbers from you until you achieve the booking. It’s sad to see from a once great and valued company. It also brings opportunity. To quote Winston Churchill:
“This is not the end, it is not even the beginning of the end, but it is perhaps the end of the beginning”
The Perfect Storm
Property managers are no longer listing all their properties on one listing site. Many are diversifying their inventory and looking at alternative routes to distribution. On the traveler side, they are pushing back on fees and are confused when contacting the 1-800 numbers on the listing site to speak with a person on the other end who knows nothing about the vacation rental they are calling about. This confusion is causing travelers to look beyond the listing sites to find their vacation rentals…..this is “leakage”HomeAway can’t afford.
I have always maintained that the best source for industry data comes from the owner/managers who are in the trenches on a daily basis having these conversations with their guests. In 2016, Grassroots Research interviewed 40 property management companies and confirmed what we already knew….travelers are not happy.
Here are some of the key findings:
- 23 out of 40 (58%) said customers’ reaction to HomeAway’s (Expedia’s) traveler service fee, introduced in February 2016, either has been somewhat (16 [40%]) or very (7 [18%]) negative, while 17 (43%) said their customers either did not know or did not care about the fee
- 34 out of 40 (85%) have seen renters getting around HomeAway’s traveler service fee by booking directly with property managers or owners, and 8 of these (20%) actively encourage renters to book directly for this reason
- 17 out of 40 sources (43%) have not enabled HomeAway’s online booking features, with 15 of these (38%) not intending to do so in the near future.
This negative impact has consequences for the marketplace and directly impacts each individual owner/manager. As uncomfortable as these conversation are to have with our guests, we view it as an opportunity to educate the traveler and help them understand the value of booking direct ….with us.
Travelers are Pushing Back
Overall our business has increased year-to-date. What is significant for us is many of our bookings are coming in directly through our Brand. Travelers expect transparency and are looking for the best value. Our biggest advantage is our DNA. It is very difficult to replicate the kind of dedication to service that are associated with our Brands. These are the memories our guests take with them when they leave…..and keeps them coming back.
What are Travelers Telling You?
Please take a moment to share your experiences through this survey. We will distribute the final results on August 15th. We encourage you to share this post with your colleagues to achieve a sample size we can all benefit from.
I see your point but I’m also concerned how some Property Management Companies with an upwards of 250 rental properties can institute such a fee when Owners book the property themselves via those 3rd party channels. How do you propose the professional management teams instill an ‘owner booking fee’ by a third party site? Thoughts?
Since moving to Zillow my direct communication has been restored and bookings have increased. Why is it so hard for a software engineer and a venture capitalist to digest the simplicity of human interaction?
Great point…one caveat. The venture approach is focused on maximizing their profits….not yours. This is how VRBO started out…we all see how that movie is playing out. Zillow has the same strategy. We use them as well…cautiously.
Traveling public forgot how to use print advertising, travel shows, visitor bureaus, Chamber of Commerce for specific property lodging selection.
They use TV and internet so get out your wallet.
I do not like the fact that Homeaway is making my job so much harder now to screen my tenants and answer questions for them. Not only does Homeaway make a hefty fee from me, but now a huge fee from the tenant. Who now won’t book me due to price gouging! I will be looking for other ways to rent.
Many feel the same way Mary Ann. Managers need to be thinking about diversification in serious terms. This latest move is pushing many in that direction. First, you need think about what types of distribution compliment your brand and give your business long term value beyond the OTA’s. This is what I presented at the VRMIntel Live Conference in Denver this past week.
We are helping many property managers get a clear understanding of the changes taking place and how to succeed. With the correct OTA strategy you can be highly successful in this new normal.