Maximizing exposure and profits while minimizing expense is the most basic tenet of any successful vacation rental business. With so many channel platforms available, it’s easier than ever to maintain consistent growth in an ever-changing environment.
With so many accessible channels to list your properties on, it can be difficult to determine which listing sites are right for you and how many you should be on.
The obvious considerations are cost, market saturation and ease of use, but that’s only the tip of the iceberg. Market trends, consumer perception, changing government regulations and other external factors all play a role in your performance on any given channel.
While the latter factors are out of your control, diversifying your listings will ensure that you maintain a consistently high occupancy percentage while minimizing your exposure to risk in the marketplace.
Upfront and backend costs
With profit being every managers’ first priority, the first two questions that come to mind are: what is this going to cost? And what is my return on investment?
Different channels have different fee structures. Some charge a flat rate while most others have a commission based structure - or a mixture of both. Deciding how you absorb those costs is a critical part of choosing the right channel for your business.
For example, Expedia and Booking.com often have much higher commissions compared to Vrbo’s pay-per-booking fees, but you’ll receive more exposure on the former channels due to their audience size.
So how do you compensate for those higher commissions? Typically, these fees end up paying for themselves with the bump in occupancy you’ll receive from being exposed to a larger traveler audience.
The good news is, with so much competition in the market, costs are leveling out across the board, making channel fees far less of a consideration than channel performance.
The majority of partners are moving (or likely plan to move) to the commission model rather than requiring higher guest fees or an upfront subscription cost.
Don’t put all your eggs in one basket
In order to maximize occupancy, it’s important to get your property listings in front of as many eyes as possible. The more channels your properties are listed on, the greater chance they’ll be seen.
In addition, market trends change all the time. Your top performing channel in January might different than your top channel in June.
However, many hosts and property managers often fall into the trap of focusing all of their efforts on a single platform. But this can lead to unexpected dips in performance.
For example, if you only list on Airbnb, any blip in your market’s monthly search levels could leave you vulnerable and unable to generate new bookings. It’s a cliche to say “don’t put all your eggs in one basket,” but in the short-term rental business, it’s a very accurate saying.
When considering seasonality and the ebb and flow of consumer perceptions of channels, it’s impossible to predict where new guests will be searching from month-to-month, so the best option is to utilize as many channels as possible to increase the number of views your properties receive and to protect against any “bearish” market activity.
Another tip when adding new channels: don’t wait for others to adopt. Becoming a first mover or early adopter on new channels - like Expedia, for instance - can yield outsized returns too. Being one of the first few properties listed in a local market means lots of visibility that will only increase as the channel invests in marketing and growth.
When assessing vulnerabilities in your channel marketing strategy, it’s important to note that as the short-term rental industry continues to mature, each channel evolves, meaning that any change in policy, practice or search algorithm can have a significant effect on your business if your reach is limited to only a few sites.
When it comes to your business, you always want to be in control. Having multiple arms of distribution will always provide property managers stability when handling changes and downturns from channels.
Take advantage of the competitive market
It’s hard to sell something without an audience. While you may not have a multi-million dollar advertising budget, OTAs are collectively spending billions of dollars to earn the business of travelers seeking alternative lodging. And that earns them the large audience that you benefit from.
This fierce competition among channels is great news for short-term property managers; the more customers they acquire means more travelers will be searching for your vacation rental properties.
By using multiple channels you can benefit from all sides of these multi-million dollar marketing campaigns.
And managing multiple properties across multiple channels has never been easier thanks to property management software.
In the past, keeping up with different platforms proved extremely problematic. Listing on multiple channels used to bring with it a lot of headaches, often times incurring additional expense to property managers.
With new tools like MyVR, problems like reservation data errors, overlapping bookings and manually keeping rates, photos and information updated is a thing of the past. Maintaining your listings’ fidelity couldn’t be easier or more cost effective.
You can now confidently take full advantage of all the short-term rental marketing channels to maximize profit while eliminating problems that have plagued managers for years.
The bottom line of risk management for your business
The short-term rental industry has changed drastically over the past few years and is in a constant state of evolution. It’s imperative that you keep up with the ever changing landscape of this market.
By diversifying your distribution it becomes simple to keep your properties listed on relevant platforms, always taking advantage of the latest market trends.