Self-service technology has afforded many customers what they want most, instant service and information about a product or service. They want to be able to purchase online and get questions answered immediately, and increasingly, they are using online communication methods instead of phones. These changes have pushed smaller businesses to embrace self-service technology in order to keep their businesses growing and attract this new kind of tech-savvy customer.
In the vacation rental industry, giants like Airbnb and HomeAway have completely changed how people rent short-term vacation rentals and have increased the total market of renters. More people are renting short-term vacation rentals instead of reserving hotels, and these big players have spent a lot of marketing dollars online to grow this market. A survey from Goldman Sach’s in 2016 (via VRM Intel) discovered that of the consumers who rent through peer-to-peer rental platforms for the first time, half of them don’t go back to hotels. Vacation rental property managers have contributed to the growth and have taken advantage of these platforms as they use multiple platforms to list their properties.
While big tech is good for the market, it’s also made it difficult for smaller property managers and owners to engage with their guests and control experiences. How can they take back some control while maximizing tools like Airbnb and HomeAway? What are the biggest challenges they face with all this new self-service technology?
First, let’s go over some of the challenges:
Too many tools and platforms.
Self-service technology has brought many great tools to the hospitality industry. That’s exactly the problem facing vacation rental property managers: There’s an app for everything. Owners of property management companies are constantly bombarded by new software, more data, and the latest dashboards. They have to wade through all of them to understand pricing, features, the benefits and how all the technology will interact with everything else. This can be overwhelming but also cause a great deal of FOMO stress. No one wants to say “no” to that perfect tool that will change their business for the better.
Increased cost for guests renting through platforms like Airbnb and HomeAway due to platform service charges.
While these big players in the vacation rental industry have brought more guests, they have also made vacation rentals more expensive for guests. These platforms have to make money, and they do that by charging the property owners (or managers) as well as guests. It used to be that vacation rentals were almost always cheaper than hotels. These days, because of all the fees and taxes involved, the prices are pretty similar or can be even more expensive.
Loss of guest engagement and guest service challenges as communications are forced through the major vacation rental sites.
Platforms like Airbnb and HomeAway want to control guest communications, primarily because they don’t want to be cut out of the transaction. They force guests and property owners/managers to communicate through their platforms when guests attempt to book their stay to ensure secure communications and keep transactions on their platforms. Of course, these “closed-loop” policies offer a level of trust and safety for the guests, but it also impedes a property manager from being able to have direct communications.
Embrace the big players, adopt the right self-service technology and use data to gain an advantage.
Vacation rental property managers need to continue to maximize their business using big tech, not ignoring or resenting it. The industry has already taken steps to influence HomeAway and Airbnb to play nice with vacation rental property owners through industry associations like NorthWest Vacation Rental Professionals. Banding together allows rental owners and managers to have their voices heard in the regulatory landscape and is also a great way to lobby for their interests. Property managers should consider finding a local industry association and get involved.
Competition is getting more fierce, and marketing to new guests and retaining existing guests is more important than ever. Property managers need to differentiate their properties by focusing on or possibly developing tools to help with guest engagement and guest service. There is a great case study in which customer experience and engagement strategies helped to build the largest vacation rental management company in New Zealand.
But making sure to engage customers and give them a great experience oftentimes hinges upon better communication tools. There are great tools to help streamline customers’ reservations for better experiences. At the end of the day, email is still a major communication channel, and many property managers don’t have a way to help them and their teams respond promptly, professionally and oozing with guest service.
Every guest a property manager acquires is a win — especially if they become repeat guests. Repeat guests have already been acquired, and if they are loyal, they will tell others about your service and you’ll get the best possible “free” marketing: word of mouth. Players like Airbnb and HomeAway may be intimidating, but they have opened up the market and ultimately brought hospitality entrepreneurs more guests. It’s important to embrace them and adopt the right self -service technology tools to give guests the best experience possible.
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