Year after year, the vacation rental market becomes more crowded with ever-increasing numbers of new listings. You may find more than six million properties listed by only Airbnb in over 190 countries. Additionally, Booking.com has roughly 30 million listings, of which about six million are holiday rental homes.
As these numbers show, it’s no surprise that most vacation rental firms have seen a decrease in occupancy rates. They’re finding it more challenging to stay up with the tough competition.
As we’ve discovered, Vacation rental operators feel squeezed by the expanding short-term rental industry and its fierce competition. As a result, during the 2019 V.R.M.A. International Conference, our co-founder, and C.T.O., Igor Kostin, chose to discuss techniques for surviving the STR industry. Everyone may start using five ideas right now, even if they missed his address.
Table of Contents
1. Increase efficiency by using technology and artificial intelligence
That technology has enhanced many elements of our everyday life cannot be denied. There would be no short-term rental homes to rent out to strangers from across the globe if it weren’t for the Internet.
The short-term rental industry has already benefited from technological advances, and so could your company. That means you’re already behind the curve if you’re still debating on whether or not to invest in vacation rental software. Because your rivals are already utilizing these short term vacation rental software, they already have the edge over you in the marketplace.
So, what precisely can be automated, and how can this be beneficial to you?
Keeping in touch with your visitors
As a starting point, focus on the communication you have with guests. Before making a reservation, the typical tourist looks at eight different hotels and speaks with five other people about their experiences at each of those establishments. As a result, you must respond more quickly than your rivals.
63% of short-term rental owners respond within 60 minutes of receiving a traveler’s request. It’s possible, though, that it’s still too long. Wouldn’t it be nice if you could respond quickly, maybe within a few minutes?
In this case, automation may be a great helper. After receiving an inquiry or completing a transaction, you may set up triggers and build templates that enable you to respond immediately.
Reviews
You may also use automation to increase the number of reviews. The truth is more than eighty percent of visitors are hesitant to provide feedback. If you initially provide your opinion, they will be more inclined to do the same for you.
When visitors check out, use automation to build review templates and distribute customized comments. The more reviews you have, the more reservations you’ll get!
Cleaning and supervision of a crew
Using automation to aid with cleaning and team management is a viable option. With the correct automation technology, this procedure will be less stressful. A job may be assigned to one of your crew members using software, and they will get it by text message and email. Cleaning may be accomplished with a single click by the cleaner.
Inquiring minds want to know how you can accomplish it all at once. Software like I.G.M.S. makes it simple to automate your guest communication, review collection, and cleaning management.
2. Second, target millennials.
Have you taken the time to figure out exactly who you’re trying to reach? What are their tastes and inclinations? Their age is unknown. The short-term rental industry is dominated by millennials nowadays. Several hosts and managers have stated that the bulk of their visitors is in the age range of 24 to 35.
When it comes to spending $5,000 or more on vacation, the millennial generation is unique. Instead of purchasing a new automobile, they choose to take a new adventure (they travel on average 35 days per calendar year, which is more than any other age group).
While they’re on the lookout for low-cost options, they also want a wide range of services to be available. High, and they want rapid assistance. You should expect them to look for another host if you don’t respond to their query within a minute. They’ll also be able to locate one in the overcrowded short-term rental market.
Millennials are drawn to places with distinctive and exciting experiences. The same brochure you sent them two years ago won’t do. Instead, attempt to amaze them with a unique cuisine experience like a specialty beer sampling. Consider giving them a certificate to use at a local bike or vehicle rental business instead.
3. Create a “wow” factor
A “wow” factor might be a powerful hidden weapon in the short-term rental market. There is nothing better than a joyful surprise, even if it’s only a tiny one.
Everyone craves attention. So, go the additional mile to wow your visitors by including thoughtful extras designed just for vacation rental houses. Millennials were almost born with smartphones in their hands, and they are huge fans of new technology. This strategy is bound to succeed.
The good news is that sensible vacation rental features don’t have to cost a fortune. A $60 investment may raise your income by as much as 20%—a color-changing L.E.D. A light bulb or a door and window sensor may set you back for less than $20. An Alexa-powered smart speaker like the Echo Dot (which is voice-activated) is an excellent option for those willing to invest extra.
The possibilities are infinite!
4. Stand out on the biggest short-term rental platforms.
Rental market saturation extends beyond the short-term rental sector. In every field of business, the rivalry is becoming stricter! Smaller e-commerce websites, for example, are shutting down. Considering that Amazon accounts for about 40% of all U.S. e-commerce sales, the company cannot compete with Amazon’s dominance.
With the rise of the sharing economy, vacation rental owners complain that direct reservations are becoming more complex. Over the last several years, websites like Airbnb, HomeAway, and Booking.com have taken over 90% of all vacation rental bookings.
However, consumers have greater faith in large platforms than in individual sites. Due to the ever-changing nature of Google’s algorithms and rising advertising prices, your vacation rental listing will be lost amid the plethora of other identical vacation rental properties. With Airbnb and Booking.com spending $2 billion on advertising in 2018 alone, independent vacation rental websites can’t even compete in the current short-term rental industry.
The short-term rental industry is dominated by Airbnb, which has a market share of up to 85 percent in several North American cities. More than 400 million guests arrived in 2018, thanks to Airbnb listings.
As a result, optimizing your Airbnb and other vacation rental websites’ search rankings is more effective. You may boost your chances of getting your Airbnb listings to appear on Airbnb’s first page by applying any of these strategies: a)
To increase the number of favorable ratings, use an automated technology like iGMS. Your listings will rise in the rankings on Airbnb if you have a sufficient number of positive ratings.
Try to get back to people quickly. Using a native messaging system, you should aim to answer within a minute of receiving a message (and not email).
Your listing’s title should be updated regularly. Change the headline of your listing every week if you want it to be seen. “Promo,” “Free,” and “Special Offer” seem to be apparent, yet consumers still click on them.
Use a short-term rental market-specific pricing tool to adjust your rates every 15 minutes.
Determined to be a “Superhost.” Listing your home on Airbnb Plus or Select might also help you get more visibility for your property.
Conclusion
In the short-term rental business, you can’t afford to settle for anything less than the best. Achieving success in the short-term rental industry means increasing your reservations and building a world-class business simultaneously.
As a result, there is nothing else for you to do except welcome change. New approaches and technology are shaping the short-term rental market’s future, so get on board now. We have already arrived at the end!
Lodgable is a sensible choice if you want to avoid the overcrowded short-term rental market.