The Sustainability Movement Is Here. Are You Ready?

Hal Conick
3/19/2024

In 2022, while speaking to a crowd of property managers at a conference in Spain, Bob Garner saw a physical representation of sustainability’s vast potential in the vacation rental industry.

Garner asked the crowd of 500 to stand if they believe that sustainability should be part of their business. Nearly every member of the crowd stood. Next, he asked them to continue standing if they have already taken steps toward sustainability.

“Ninety percent sat down,” says Garner, who has owned and managed eco-friendly vacation rental properties in Italy for nearly 20 years.

Those in the crowd who sat are the industry’s untapped potential of sustainability. And that untapped potential, left as it is, may soon cause problems for guests and managers alike.

No Longer a Niche

Many people now desire to travel in a way that doesn’t create needless waste and reduces their carbon footprint. A report by World Travel & Tourism Council (WTTC), Trip.com Group, and Deloitte found that almost 60 percent of travelers have chosen more sustainable travel options in the past two years.

And Booking.com’s 2023 Sustainable Travel Report found that 76 percent of people want to travel sustainably over the next 12 months, with 74 percent saying that they want travel companies to offer more sustainable options.

“It’s no longer a niche; it’s now quite a big consumer group,” Garner says. “There’s a whole new market hosts can tap into.”

Many of these travelers are choosing more sustainable options because they’re concerned about climate change. Booking.com reports that 74 percent of travelers believe that sustainability is important now, as they want to save the planet for future generations. These travelers have seen research showing the impact of travel, including a study in the journal Nature Climate Change that found that global tourism accounts for 8 percent of global greenhouse gas emissions.

Although more people are concerned about the climate and want to travel sustainably, many seem to feel priced out of sustainable travel. Nearly 50 percent of travelers told Booking.com that they want more affordable sustainable options.

A Growing Movement

With a new market of sustainable travelers comes growing business opportunities. If vacation rental managers can offer more sustainable options at less expensive prices, they may win over mor sustainable travelers.

At Garner’s rental properties in Italy, where his company has added a plethora of sustainable amenities, he said that they receive a 90 percent direct book rate and a 65 percent return rate. He believes that they come back because they’re offering a good quality service at a good price, while also giving travelers the sustainable vacation they desire.

“If that’s what the traveler wants, then that’s what I’m interested in,” Garner says. “And then everybody wins: The traveler is happy, then the host is happy because they’re getting the bookings. It’s a win-win.”

The main issue is that many vacation rental managers—especially those who run smaller businesses—don’t know where to start. Big companies have the means and resources, perhaps even hiring sustainability specialists, while smaller companies don’t have those same resources or the access to that knowledge.

But now, there’s a movement of individuals, platforms, and agencies that want to help vacation rental property companies of all sizes become more sustainable.

Garner founded EnviroRental to provide resources and knowledge on sustainability to vacation rental professionals. He noticed that there was a lack of knowledge on small steps companies can take toward sustainability and wanted to provide resources to the industry for free.

“That’s our reason for being: to educate, inform, and persuade people to take action,” Garner says.

Vanessa de Souza Lage also wants to help the industry become more sustainable. She left her job as chief marketing officer at Rentals United in 2021 to co-found and serve as CEO of Sustonica, which calls itself the first agency to bring a certification for sustainability into the short-term rental industry.

Sustonica took a year and a half to build its sustainability criteria, getting input from auditors, university professors, and hotel sustainability experts. Now that they’ve been verified by certification services company Bureau Veritas, de Souza Lage hopes to create a pathway toward sustainability for smaller players in the industry, one that will also give them a tool to win over the new market of sustainable travelers.

“I’m quite amazed what we’ve achieved, but there’s demand for it,” de Souza Lage says. “The world is ready. And the demand is really being driven by the [online travel agencies (OTAs)].”

Brace for Search Impact

One of the world’s biggest travel platforms is betting that travelers will continue demanding properties to be sustainable. Booking.com has thus far been the OTA spearheading the sustainability movement, making sustainability a larger priority in its search rankings than other platforms.

In 2021, the company launched its Travel Sustainable badge, which shows travelers what steps properties have taken toward sustainability and gives partners help in becoming more sustainable. Thus far, 600,000 partners on Booking.com have a badge, which must be vetted by the company.

Eric Bergaglia, Booking.com’s global head of accommodations, says that sustainability moved from an important topic when he first joined five years ago to a major area of focus for the company’s strategy. Now, vacation rental managers who work toward a badge on Booking.com will see a boost in their listings, as well as the ability for guests to filter for those with sustainability badges.

And like EnviroRental and Sustonica, Booking.com also offers education and resources for those who want to learn more about sustainability. Thus far, Bergaglia says that 80 percent of Booking.com’s partners have expressed interest in joining this program, but he said that they don’t yet have any financial success metrics to report.

“Every partner that has been on that journey would probably tell you that it’s worth it,” Bergaglia says. “They’ve seen more revenue or bookings coming. People are happy that they’ll be able to do something good for the planet by making a sustainable decision.”

Here are some steps that vacation rental managers can take to improve the sustainability of their business and properties.

Make a Slow Mindset Change

Vacation rental managers should think of sustainability more as a slow mindset shift than an all-at-once change, de Souza Lage says.

“You’re not expected to do everything perfectly from day one,” de Souza Lage says, adding that getting the first badge from Sustonica means meeting 20 percent of their criteria in the first year of work. The agency has different criteria for different kinds of homes, but all focus on energy conservation, waste reduction, water conservation, and promoting the local community.

That same philosophy comes as part of Booking.com’s Travel Sustainable program, which awards badges based on where partners are in their sustainability process. In the first level, managers have implemented have been some sustainable practices. In the second, there have been considerable efforts and investments into sustainability, with the third level requiring even larger investments. There’s also a badge for companies that have received third-party certification from agencies like Sustonica.

Like Sustonica, one of the factors that goes into Booking.com’s badge system is what sustainability efforts fill the needs within the local area.

“Issues in the Netherlands aren’t the same as those Morocco, so that is considered during the process when partners are getting a badge,” Bergaglia says. “All you need to do is declare what you have been doing in our ecosystem. Based on this, you will quickly get the assessment of whether you deserve a badge and at what level.”

While the sustainability badges and certifications are now solely a benefit, the market could soon punish those who do not have them. Bergaglia expects a larger number of guests to use the badges and certifications to filter out non-sustainable properties, leaving those who don’t work toward sustainability with fewer bookings.

“The good thing is that there’s now momentum,” Bergaglia says. “There are solutions. And we see willingness from both sides of the marketplace to make something happen.”

Take the Easy Wins

There can be easy sustainability victories that don’t need to come in the form of a repeated chore. Some big wins, de Souza Lage says, can come by way of a single phone call.

The easiest change comes from products used at properties, she says. Managers can change their procurement practices to buy more sustainable soaps, cleaning products, and toilet paper, as well as getting rid of single-use bottle products and replacing them with refillable tanks. These tanks, de Souza Lage says, will also save money over time, in addition to cutting down on plastic waste.

The first move that Garner suggests is checking if green energy tariffs are available for the electricity that comes into the property. Energy typically comes from coal or gas, but now there are more options available to switch—for free—to energy powered by wind or solar. It’s the same electricity coming through the wires, but the tariffs mean that the money paid to the electricity company is invested in green energy.

“That’s one of the biggest parts of your carbon footprint,” Garner says. “Changing sounds like a big deal, but it’s not. No interruption of service, no extra costs, and then your money is going to invest in green energy. If everyone did that, the impact would be absolutely incredible.”

Easy and automatic wins allow managers to alleviate any the guilt thrust upon guests by poorly done sustainability efforts. A bad way to become more sustainable, de Souza Lage says, is to require guests to take out recycling, use inferior products, or manage the building’s air conditioning.

“For the air conditioning, we recommend using a smart occupancy sensor, which knows when the guest is out of the room and turns off the air conditioning,” she says. “You don’t have to ask the guests to do anything, but it reduces overconsumption and your bills. It’s common sense.”

Create Your Own Climate Action Plan

For many vacation rental managers, it may become hard to keep up with sustainability practices without a plan—after all, a business has far more tasks than becoming more sustainable.

To avoid losing steam on the path toward sustainability, he suggests creating a climate action plan for the business. “It doesn’t have to be daunting; it can be a series of bullet points,” Garner says. “This year, I’m going to do A, B, and C. Next year, I’m going to do E, F, and G. There’s your climate action plan. That’s all it needs to be. Just don’t make it overly complicated—keep it simple.”

EnvioRental offers sustainability roadmaps, showing vacation rental managers how to build their action plans. These plans will help hold managers accountable and allow the business to keep seeing results, Garner says, and he believes that managers who follow their plans business will see increased bookings, lower costs, and more returning guests.

Sometimes, Garner says that success in the climate action plan comes from unexpected places. For example, when Garner was taking steps toward making his Italy property sustainable, he made plans one year to add an electric car charger. By installing that charger, their property was also found on a database for electric car owners, exposing their business to more people who spend money on sustainability.

“And then people come to us, because we provide a service,” Garner says. “We’ve got great properties, a pool, and a lovely view, but those who drive an electric car, they want to charge it overnight. They then look for a place with a car charger. They may not have booked otherwise, so we’ve got a competitive advantage over the people around us.”

Once sustainability efforts are in place, Garner says that managers must start publicly talking about their sustainability efforts. It can be a big win in marketing, allowing new guests to find the properties, but it can also help other vacation rental managers join the sustainability movement.

“You’ve got to talk about it,” Garner says. “Then, people can know that you’re a sustainable business. You’ll have an influence. If each of us improves our sustainability practices and talks about them, that influences ours peers, our colleagues, and the industry.”

The Future of Sustainability in Vacation Rentals

There are two big changes coming from the sustainability movement that will touch the entire industry: more regulation and more changes by OTAs.

While Booking.com is the first platform to focus heavily on sustainability, the Expedia Group announced its Open World social impact and sustainability strategy in 2022. One of the main focuses of this plan is sustainability—Expedia plans to reach Net Zero emissions by the year 2050. Another big OTA, Airbnb, announced plans in 2021 to reach Net Zero emissions by 2030. Most of its work thus far focuses on using renewable energy and engaging with suppliers to help lower emissions.

While Booking.com’s badge system is the biggest change to the algorithms of OTAs and it’s unclear what the other OTAs will roll out, changes are sure to come to each platform. At the very least, guests will soon have the option to filter for what properties have taken steps toward sustainability—this should serve as a wake-up call to those who don’t see the business case for sustainability.

An even bigger threat is changes to regulations. Bergaglia expects that regulation for sustainability will soon increase across the world. This could be as simple as a law requiring updates to windows but could also become far more complex, potentially forcing legal changes that will affect guests, managers, and property owners alike.

“Regulation will be coming,” Bergaglia says. “Telling property managers that they may lose visibility on OTAs and there’s regulation coming is a different kind of incentive. You may want to take a harder look at how to make your properties more sustainable.”

To contend with these changes, Bergaglia believes that there will be more all-in-one sustainability solution companies that launch. Like the recent shift in smart home technology, which saw companies form to help vacation properties modernize, Bergaglia believes more professionals will come help the industry modernize its sustainability practices.

And even in the unlikely case that OTAs and regulations remain as they are, guests will become smarter and more aware of environmental issues, thus more concerned about sustainability. Already, younger travelers are more aware of and inclined toward sustainable travel. A 2020 report from Statista finds that 56 percent of Generation Z travelers believed sustainable travel is important, versus 46 percent of baby boomer travelers.

“The younger groups are much more interested in this topic,” Garner says. “I’m one of the oldest people in the industry, but the younger people—those under 30—are much more connected and realize that there is a climate emergency.”

Soon, de Souza Lage expects to see a sharp rise in vacation rental managers who adopt sustainability practices. They won’t have a choice, she believes, as many will see guests, investors, and even property owners will demand more sustainable practices from the industry.

From the time of Garner’s speech in 2022, where most of the crowd responded that they weren’t working toward sustainability, he’s seen huge changes. More sessions at conferences are dedicated to sustainability, more people are talking about these issues, and more vacation rental managers are adopting sustainable practices. What he wants to see in the future are more people—especially younger industry professionals—taking the lead on sustainability.

“My dream is that a year’s time, I’m redundant and I don’t need to do this,” Garner says, adding that he has hope that this will be true. “Two years ago, nobody was speaking about sustainability—there was nothing on the agenda about sustainability. But now, it’s becoming more mainstream. We’ve got a load more to do, but it’s encouraging that people are starting to talk about sustainability.”

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