VRMA

    30 Lessons from our First Decade of Vacation Rental Management

     
     
    This is part of an ongoing series celebrating VRMA's 30th Anniversary.


     
     
     



     


    Eleven years ago, my team and I kicked off CottageLINK Rental Management with just four properties – three of our own and one belonging to a friend we arm-twisted to let us represent his place. We were competing with several well-established vacation rental management companies and it was an uphill struggle for a few years, but here we are now with around 200 cottages under management and year-on-year growth that regularly exceeds goals. 
     
    With all that said, if we look back, there are so many things we would have done differently if we were to start over. To celebrate VRMAs 30th anniversary, here’s 30 learning points from our first decade of vacation rental management.
     
     

    Systems
     

    1. Start with an end goal in mind and think big
    As a fledgling rental management company we started small but our vision was small too, so we bought into a reservation system that wasn’t able to handle our growth. Changing to a more robust product that would see our evolution to a much larger company was challenging. Invest wisely from the start and for the future. It may be a larger investment, but over time, the higher price tag will be justified.
     
    2. Outsource more
    Do what you are good at, and outsource the rest. Spending time learning social media platforms (although it is fun) is not a good use of time that could be spent on owner acquisition and strategic planning. Evaluate what is the best use of everyone’s time and the return on investment for every activity.That will show you what needs to be outsourced.
     
    3. Outsource wisely
    As a follow-on from the point above, outsourcing needs to be taken as seriously as hiring new full-time staff. Use sites such as Upwork (previously Elance and Odesk) to find specific skillsets then review resumes, shortlist and interview (using Skype). Cheap labor can mean poor performance, so avoid very low hourly rates--you really will get what you pay for.
     
    4. Plan for damage
     In our early years we spent too much time assessing damage claims from owners and it became a stressful activity. Implementing an Accidental Damage Plan meant fewer chargebacks, reduced time spent on mediating with owners and guests, and a more streamlined system. 
     
    5. Hire a specific person for dealing with guest issues
    In small VRM companies, the principals often find they are doing every job, and it's not until good growth occurs that it’s possible to delegate. And even then, guest complaints tend to come back to the top. Hiring a person specifically to deal with the issues in peak season was the best thing we ever did. Choose a law student who wants to hone their mediation skills, and breathe a sigh of relief. 
     
    6. Create a systems manual
    If the only person who knows how to update a system or change a data set gets sick or goes on vacation, you are in trouble. So, while all our staff have learned our systems, there’s a champion for each one. That person writes the manual (standard operating procedures) and is responsible for troubleshooting and training new staff. Always have a back-up person that can fix the system when it goes wrong, but a good set of SOPs can go a long way!
     
    7. Have an emergency plan…
    ...for every eventuality. When the SARS outbreak occurred in Toronto in 2003, we only had a few properties but were inundated with people who wanted to get out of the city. We heard from other agencies that city-based owners wanted their places back even though they were rented so they could head to the country. We learned early on that emergency planning should be at the core of our annual business strategy, with procedures in place in the event of simple power outages to a full-blown epidemic.
     
    8. Use a local call center
    There are many options available for call handling, but nothing beats a 24/7 service with people answering who know the area and can offer simple guidance on directions and property locations. There’s no out-of-hours voice mail or office closure – always a real person at the end of a phone. It’s not an inexpensive service but the conversion rate it offers makes it worthwhile.
     

     
     
     
    Owner Acquisition, Education and Retention
     

    9. Help owners spread the word
    Our initial growth was slow – 3 to 13 properties in the first year and could have been a lot faster if we’d implemented a referral program at the outset. This came a lot later and for some owners, it’s a good source of additional income as they refer their friends and family. The program can take many forms from reduced commission to lump sum payments on completion of the first reservation. It’s a popular program.
     
    10. Get owners involved as much as they want
    Originally we thought homeowners who wanted to use an agency would be hands-off. We quickly realized there were some who just didn’t have the time for communicating with guests, but loved the marketing, and others who just wanted us to bring the guests to their door and then they would take over. The bulk of them are happy to get the checks and don’t want any involvement. It’s now a discussion we have at the first meeting, and it saves any later misunderstanding on roles.
     
    11. Create an owner education program
    Most owners don’t come into this industry as savvy VR business owners. Many see it as a way to create some quick income without understanding the investment of time and money, and the importance of adopting a philosophy of hospitality. For some it never evolved and we parted company quickly; others embraced the new learning and amazed us with their guest-centric approach. Creating our owner education program of webinars, a resource library and videos has helped enormously.
     
    12. Schmooze with local realtors
    A significant proportion of our new listings come from local realtors. We hadn’t appreciated the value of having great relationships with them until the referrals began and now it has become a reciprocal flow. When an owner wants to sell a property we refer them back to the same realtors, and often find they become our best ambassadors. Creating a page on our website for them to advertise on proved to be a successful strategy, as they appreciate the free advertising.
     
    13. Go with your gut
    This applies to both owners and guests, and it’s a good yardstick. If something doesn’t look, feel or sound right, be very wary. There is often little that is specific – it’s simply that deep-down gut reaction that says, "run away...fast."  We have taken on properties against all signs that point to it being a bad decision, and have regretted it. 
     
    14. Building relationships with owners increases retention
    At first we figured that our owners would just be happy to have bookings, but as we grew it became clear that retention levels could be governed more or less by the amount of positive feedback given to owners. And this needs to be driven by their account manager (that’s our term for the person who created the initial relationship). The quality of that relationship has a direct correlation with the potential for retention year on year. 

     
     
     
    Guest Management
     

    15. Build an FAQ list for each property
    After answering the same questions over and over again, it seemed a natural thing to just create a standard FAQ for each property, and just make sure we had the answer to everything listed. Yes, we know how deep the water is before it goes over your head, and yes there will be blackfly in June and deer fly in August, and no, this cottage does not have an ice-cream maker...Whatever has ever been asked and answered is on the list, just waiting for the next time.
     
    16. Always be one step ahead of the expectations
    Back in the old days, guests seemed happy with indoor plumbing and a TV with rabbit ears. Now they expect all the comforts of home as standard, even in the most rustic of property. Dishwasher, laundry, wide-screen satellite or cable TV, and, of course, WiFi. Being proactive with information on what a property doesn’t have as well as what it does has saved the day on many occasions.
     
    17. Knowing the 20% is being forearmed
    80% of guests are self-reliant, appreciative and tolerant of the occasional breakdown of a facility. The other 20% will deliver the majority of the complaints, cause damage or create issues with the neighbors. Recognizing them from the inquiry stage makes it easier to be prepared  for the inevitable calls when a lightbulb needs changing or the microwave is just too darn complicated and needs to be explained.
     
    18. Reading is an outdated activity
    That sounds a little jaded, but in our experience, people are unlikely to read beyond the first page of a property Welcome Book. Placing the important information such as emergency numbers, checkout time and the WiFi password in single page sheet at the front of the book AND on the inside door of a well-used kitchen cupboard is more likely to garner attention and reduce the likelihood of calls at midnight wanting the number of the nearest emergency vet.
     
    19. Know the spare key location
    Lock boxes get jammed, the keyless variety can lose battery power and guests forget codes. Regardless of the pace of technology and the advent of remote systems, the good old key in a flowerpot often saves the day. Many of our properties are in locations without cell signal or WiFi that might offer remote help, so it’s back to basics. Once all our owners hid a key, major access issues became a thing of the past.

     


    Property Management
     

    20. Always have the caretaker's cell number
    Because our properties are so widely dispersed -- some are  seven hours from our office -- we don’t have a housekeeping arm to the company, and all our properties are cleaned and maintained by either the owners or third parties they have hired. We require them all to carry a cell phone and to accept text messages during times of guest occupancy. This may seem pretty basic to VRMs whose properties are all closely located, but when managing 190 or so different contacts, it can be a challenge to know who to contact in case of problems.

    21. Use a robust CRM 
    Our CRM has streamlined our feedback and issues. Beforehand, our basic reservation system had no process for recording maintenance issues and damage reports. Before moving to a new booking platform we’d begun using our CRM and are nowhere near using it to the full, but it really works for us to formalize every connection and collate correspondence.
     
    22. Have a bed bug plan
    The first time we got the "bed bug call," we were at a loss as to what to do. The guests were freaked out, the owner staunchly denied it could be a possibility, and we had no pest control contacts to call upon. Happily, that one turned out to be a false alarm and the culprits were identified as no-see-ums, however it was a good learning experience.  After it, we took advice from a bed bug expert and now have a set procedure to follow in the event of another bed bug claim.
     
    23. Everyone expects unlimited Internet
    In our rural areas where Internet access is often via satellite systems that have restricted bandwidth, we learned the hard way that our city guests have no concept of limiting their Internet usage. Kids are born to stream, download and watch 24-hour Netflix without a thought to any limits on access. One of our owners suggested putting the WiFi code in a sealed envelope with a declaration printed on the front that states breaking the seal constitutes an understanding that there are a certain amount of gigabytes available for use, and overages will be charged for. A brief list follows showing how much bandwidth is used watching an HD video, downloading music etc. This is very effective in curbing overage.
     
    24. The importance of guest education
    Cottage rental is still a very new concept and we have a large proportion of guests each year who have never experienced this type of accommodation. They have little understanding of the problems created by arriving two hours early and disrupting the cleaning team, or not being ready to leave at check out time. They have no experience of septic systems or water pumps, or the need to keep garbage indoors (unless they want a bear on the deck).  We’ve created a basic "Guide to Cottage Country," and are working on a set of videos. Maybe there is an app for that!

     


    Marketing
     

    25. Be strategic with social media
    We’ve played with Facebook, Google+, Youtube videos, Twitter and Instagram and haven’t really mastered any of them. The traffic we get from the platforms is minimal but we’ve persevered. What we’ve really learned is that the best way forward is to focus on our target market and hang out where they do. So, it’s Twitter for media connections, Facebook for families, and Instagram for the milennials.  
     
    26. Know where your travelers will find you
    It’s easy to fall into the trap of wanting to be everywhere and before you are aware the ad spend really adds up. Knowing where your travelers will find you is key to marketing wisely. For u,s the bulk of our traffic comes out of the city of Toronto and uses home-grown and local listing sites.  Spending outside of those has cost a lot and driven little traffic.
     
    27. Create and segment email lists
    This is new to us, and something we haven’t done a great deal of in the past, but creating specific lead magnets to encourage travelers and owners to part with their emails is proving effective. We created several simple one-page PDFs that deliver valuable information to niche markets, such as bait tips for fishermen and secret hiking trails in a popular location. 
     
    28. Connect with local suppliers
    Reciprocal marketing with rental outlets, event planners and other local suppliers is very effective to bring additional traffic. Potential guests often find us via our links shown on supplier websites, and we link to their sites off our listings.
     
    29. Actively seek out new rental clients
    Our locations are popular with those seeking outdoor activities, so rather than expecting our guests to come to us, we actively look for them on forums and niche-specific Facebook groups. The key to using this is to never blatantly advertise, but to join and become part of the discussion and contribute something of value. For example, triathlon training groups, kayakers, bird watchers etc., all have groups where they discuss upcoming events – and they will all be looking for accommodations. Be there when they do and make sure your web URL is included in your signature block!
     
    30. Help – don’t sell
    We researched some of the best performing VRM Facebook and Twitter accounts and found they tend to promote their company products only 20% of the time. The rest is offering helpful information, tips and advice on enjoying a vacation in their location. Forget posting endless streams of listings, and instead concentrate on helping guests plan their best vacation ever.



    Summary

    No list is ever going to be exhaustive and this could have gone on. Like every other vacation rental management company, we learn continuously, and make changes in direction and strategy based on those experiences, and every location and area will have its own specifics. Not all of our learning points in this list will be relevant but if you have picked even just one nugget to use in your business, we hope it’s been helpful.

     
    What would you add to the list?



     
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