The state of the vacation rental market is one that is filled with challenge and opportunity. Changing market dynamics, higher expectations from customers and a range of new tools and processes at the fingertips of all professionals in this space continue to shape the big picture going forward.
We sat down with VRMA Board Member Toby Babich, the president and CEO of Breckenridge Resort Managers, to get his take on the biggest threats facing this space, and advice or how to effectively combat these threats.
What is the biggest threat to the vacation rental management space right now?
Babich: The vacation rental world is changing at a rapid pace, searching for its identity in the new online era, and offering guests a universe of information at the swipe of a touchscreen. Within this, several areas of challenges exist that we all deal with daily, including:
- The emergence of the next generation of reduced service and non-traditional management companies
- The continued merging of large consumer facing travel brands
- Monitoring and fighting regulation nationally and locally
- Continued downward pressure on rental rates and revenue margins
- The increasing difficulty and expense of inline marketing and proper multi-channel distribution
- Adoption of industry standard best practices and procedures in all aspects of business
In my estimation, the largest threat faced by the professionally managed community today is the ability to define as an industry what it means to be a “Professional Vacation Rental Manager” within the rapidly changing global travel market. Within this constant state of change, the question is how to discern a clear identity, and how to easily explain this to customers and guests.
Within our VRMA board meetings I sit amongst some of the best minds in the business, within an association of the most dedicated professional managers in the world, and a defined answer remains elusive. If we have difficulty setting the standard, it must be difficult for our owners and customers to discern what value “professionals” bring into the ever-complex travel equation. For the last three years in my seat as a Director of the VRMA, one question has come to the fore often, and remains without consensus- “What is a Vacation Rental Manager?”
In what ways can professionals in this space effectively combat these threats?
Babich: In a word: differentiation. As professional managers, we must be able to define what sets us apart from the rest of the industry, and more importantly we must know how to articulate our value in very simple terms to a very wide audience. Many professional managers can scarcely keep up with the “new and improved” realm of travel, and have difficulty defining exactly what we do within a succinct value proposition.
To me, this elusive definition boils down to a simple phrase: Professional Vacation Rental Managers are educated and dedicated professional operators and community members.
- Educated- We seek out and ingest a wide variety of educational opportunities to become skilled operators in our space. Education sets us apart, demonstrates proficiency, and drives our position as the collective industry standard.
- Dedicated- We realize that we are a part of a larger industry, and seek to elevate that industry though our own actions as operators, and collaboration with other industry professionals.
- Professional Operators- This industry is a business for us, not a hobby, and we seek to set a higher standard in our daily business practices, by delivering a premiere experience to our owners and guests.
- Community Members- We are your neighbors, friends, family, and acquaintances. We give back to our community through service on boards and committees, sponsorships, education, donations, and volunteer involvement. We live where we work, love where we live, and care for our community.
Can you recall a situation where you faced a threat and how you effectively resolved it?
Babich: I believe that my experience in resolving this threat is fairly common amongst professional managers, as we must consistently demonstrate our value in a travel industry to prospective owners and guests daily. When recently presented with a prospective owner who was considering renting on their own, I provided them several documents we have prepared that outline the complex nature of the travel market, the headache of operations, the increase in gross revenue with proper distribution, and our value being able to bring all of that together to benefit them personally and financially. I find that many owners are receptive to the idea that we can increase revenue and cut costs as managers, but the real value is the feeling we instill in the owner of trust in our partnership with them and the impact that will have on their personal lives. As educated and dedicated professional operators and community members, we have the unique ability to develop relationships with our owners centered on trust and confidence.
What type of advice would you give others who are experiencing the same?
Babich: I train my staff and associates to “be the expert”, and I would urge anyone who is currently involved or looking to join our industry to do the same. Educate yourself, both in the dynamics of your local market, as well as in the larger global industry. Achieve certifications, designations, and licenses relevant to your field. Serve on local and national boards and committees dedicated to portions of the travel industry. Join associations relevant to your industry, and adopt best practices and procedures from association with others in the industry.
In short, elevate your knowledge, demonstrate your skills, and articulate your value.