Remember the days when booking a vacation rental meant hours on the phone taking inquiries or following leads, and then weeks of mailing and faxing paperwork and payments across the globe?
With all the tools and technology we have today, it’s hard to imagine the tens of billions of potential dollars wasted on this labor intensive process. The accelerated change in technology has spurred an unprecedented growth and interest in vacation rentals and you should be poised to ride the crest.
Are you ready to take advantage of the five major trends that have emerged in the past decade? Here are some ideas on how to leverage these trends to make your business the most efficient and profitable.
The IATA forecasts a 31% growth of passengers in 2012-2017. With access to the world a matter of surfing the internet, and air travel costs within the range of affordability, vacation homes are no longer the choice for travelers coming from destinations only within driving distance. Travelers are coming and going all over the globe--and they are more adventurous than ever.
How should you leverage this trend?
- Market to the World. Institute 24x7 lead response so you cover all time zones.
- Employ staff who speak more languages and be aware of cultural sensitivities.
- Explore global currency/payment strategies. Online digital payment processes are a must. Can you imagine mailing a check from China?
- Expand your marketing and advertising strategies to include global channel partners.
With the consolidation of data and more information aggregated in one place on the internet, competition has increased. Tech-savvy consumers are now in control of their purchases from beginning to end, being able to make last minute bookings with less planning, often without ever speaking to a human. While it’s dramatically easier to reach more consumers, it’s much trickier to make sure your property is seen.
How do you leverage this trend?
- Become more competitive! Pricing is the most important variable to comparative shoppers--as they toggle between competitive sites, you want to be the most attractively priced out there.
- Be the first to respond! The desktop computer or mobile-using guest has the ability to inquire about multiple places in real time. Those property managers that respond in real-time will have the competitive edge.
- Get yourself seen in many different places at once. Use major aggregation opportunities and hosting sites to be seen by the searching guest or your property will simply never get seen. You want the widest advertising network you can find.
- Analyze what works for you and use the results to plan your media strategy and to make business easier and more profitable.
3. Yield Optimization
Yield optimization has been used by the airlines and hotels for decades to help reduce vacancy and increase revenues. Now data consolidation combined with automation is making yield optimization more possible for the vacation rental industry. Based on supply and demand, companies with optimized data sources will be able to set formulas for price ranges on each property, leveraging information to get the best price when busy--and reduce vacancy when not.
What do you need to do to leverage this trend?
- Develop a plan and participate! Read articles on best practices and materials on the best tools as they arrive.
- Start thinking about a yield strategy for each of your properties.
- Restructure your owner contracts to allow for pricing flexibility.
- Test the waters -- use easy to manage last-minute discounts and higher premium pricing for early holidays bookings.
- Analyze, evaluate, and test new options to find the ones the work for you.
4. Instant Communication
Because consumers can now get any information they seek in real time on their mobile or desktop, they expect to receive information more or less instantly from you as well. Like the internet, consumers think that property managers are ‘on’ 24X7 and should be able to get back to them in some way in less than a hour -- or they will simply move on.
What can you do to keep ahead of the game?
- Use all the response management tools at your disposal, such as email, live chat, mobile text, social media, community boards, review sites, etc. to create personalized, automated, fast responses 24X7, anytime day or night, anywhere in the world.
- Be ready to nab the reservation and secure the booking! Have your contracts available online or via email, and offer online collection of signatures and approvals.
- Figure out digital payment methods. Very few people trust or like sending checks through the mail anymore.
5. Consumer Powerification
In this age of instant gratification, a complaint will flash through the universe faster than a speeding comet. An unhappy customer only has to write two lines of purple-faced prose on the internet and your name, and the unhappy reason for it being mentioned, is multiplied to the power of infinity in perpetuity. The cost to your reputation and revenue is immeasurable.
What can you do to mitigate consumer power?
- Use it to work for you, not against you! Focus on 100% customer satisfaction 100% of the time.
- Turn unhappy guests into happy customers, even if it hurts. Remember you are in the hospitality business, not the rental or real estate business.
- If a complaint is valid, make a valid change.
- Respond professionally to negative reviews.
- Encourage and reward good reviews--and make sure consumers have opportunities to view them -- as well as are empowered to share them.
How are you changing with the industry? How are you leveraging the trends? There’s no denying that to survive and thrive you need to spend more time learning and innovating than anytime in your business’s history.