Will Homeaway Expedia Advertising Partnership Cost More?

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Will You Soon Be Paying More Money To Advertise On HomeAway?

Will The Homeaway Expedia Partnership Cost You More?

 

Have you heard about the Homeaway Expedia partnership?

Could you soon be paying more for your HomeAway bookings and subscriptions?

In November of 2013, Homeaway announced an epic partnership with the travel giant, Expedia.

Less than a year later, the market- shattering partnership between Homeaway & Expedia has formed.

 

It is beginning to take its true form, as it reshapes and transforms the vacation rental industry.

 

I was recently contacted by a vacation rental owner who expressed to me their frustration with a new policy that was put in place by HomeAway.

 

The owner was upset because HomeAway implemented a new policy that requires owners to turn on the online booking functionality on their listings if they want to keep up the level of inquiries they receive from HomeAway.

 

What does this have to do with pricing and partnerships?

 

HomeAway told owners that if they do not turn on this online booking feature, their listings will be penalized in their search engine, resulting in less exposure for those properties that do not comply.

 

Owners have shared with me that they’ve experienced this penalty in the form of lower ranking scores and they’ve seen their HomeAway inquiries decrease.

 

It appears there may be a reason HomeAway is making these changes, and it directly correlates with its recent partnership with Expedia.

 

The partnership between these two giants is young and still evolving. I expect to see more rules, policies and system changes in the near future.

 

The question now is, will you be charged more in the not so distant future? I am strongly inclined to say “yes.” In fact,  owners on the pay-per-booking model will soon see an increase in their booking fees.

 

Vacation rental owners and property management companies have paid HomeAway 10% commission per booking facilitated through their website.

 

A recent statement from HomeAway detailed that owners and managers will have to pay an extra fee of 3% for credit card processing.

 

“Owners will now pay 13% for bookings made through their site,” said Jon Gray, senior vice president for the Americas at HomeAway.

 

As of now,  the only owners and property managers who can have their properties listed on Expedia through HomeAway’s syndication service are those who are using HomeAway’s commission pay-per-booking model. However, that could change.

 

“We are working toward offering customers the opportunity to participate in Expedia distribution using subscription-based model on HomeAway sites,” Gray told MainStreet.

 

Whenever there are changes with HomeAway, owners get nervous. Do you think this new listing structure will cost you more? If so, will it be expensive?

 

My thoughts are that we could soon see listing subscriptions reach $2500 with HomeAway. Does this sound off target?

 

Do you see any other changes happening with HomeAway or Expedia? How is this personally affecting you?

 

I would thoroughly like to hear how you feel about this. Please share your thoughts by leaving your comments below.

 

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  • Jeffrey Rollin

    My listing with HomeAway has dropped in placement and I’ve seen a noticeable decline in rentals. I’ve been considering dropping the listing all together. Their prices are increasing but the inquiries aren’t! Frustrating

    • Did you turn on the booking module?

      • Jeffrey Rollin

        No Jay.

        we use our own reservation system. I’ve spent time setting up my system and I don’t want to use theirs.

        • I completely understand… I have been wondering if HomeAway is working toward dominating the booking software market as they’re doing with the listings. Especially since they’ve acquired the Glad To Have You App and now forcing owners to use their booking system? What will this mean for the booking software companies? If anything?

          • Neil Stead

            Just found this thread…
            I think that’s almost certainly true. HomeAway have recently brought in Two-factor authentication. Apart from the fact that half the time it doesn’t work, and assumes that everyone takes their phone with them when they travel overseas, it also means that 3rd-party Property Management applications can no longer log in to the HA website to synchronise calendars etc.

  • Larry Meyer

    I do not like HomeAway’s attempt to force us to automatically except on-line bookings. This is not Hotels.com. I have no security service. I have a multimillion dollar oceanfront vacation rental, not a hotel room. I am not about to turn over the keys without a conversation and screening.

    On the other hand, what choice do I have except HomeAway/VRBO? I get little from my FlipKey listing. I paid $400 to a vacation rental marketer to set up a pay-by-click Google Adwords campaign and many click and hundreds of dollars later, I got nothing for my efforts. I paid one of the vacation rental websites to design and host my website VirginIslandsVillaRental.com and have not had one inquiry. When we started out in the early 1990’s we could use SEO to get positioned on page 1 or 2 of the biggest Search engines (there were several big one back then, not just Google) . NOT ANY MORE…. the front two pages are dominated by the big companies. In my mind, I do not see how SEO can get you anything if you are a single vacation rental guy.

    So we are stuck with HomeAway/VRBO and whatever they want to do.

    • Hi Larry, welcome..What an amazing property you’ve got, I wish I was there now! You bring up a good point about security, wonder if others feel the same. Google Adwords is not a “marketing plan” its just a component, which many of our owners don’t even use, we focus on free organic traffic from Google, thats where the BIG ROI is.

      In my last post I created a video about how to harness the power of search engines using very niche terms to steal customers right under the nose of the big guys… http://www.villamarketers.com/longtail-keywords-seo/ Larry the Internet is a huge place, there are tons of ways to make bookings and some are free! The problem seems you’ve given up after a few failed attempts, failure sometimes is part of success, I see failure as just, success deferred. I will try to help you revive your hope by posting exactly how this is done in some of my upcoming posts and just maybe you can see where you missed the mark. I find that the ones who are truly succesful are those who have a well thought out marketing plan, do their research, use people who really know their stuff and don’t give up! I took a quick look at your site and there are no targeted keywords in the site, so travelers won’t find this site in Google. Also the lack of keywords within your website greatly increases the cost of your Google Adword campaign, the “marketers” should’ve suggested optimizing your site first, before launching a Google Adword campaign, that would’ve certainly reduced your costs. The one thing we can’t do is lay down and let big business run us over! Our families and livelihoods depend on our success! There is a way!

      • Larry Meyer

        Thanks so much, and yes I did look at some of your suggestions (ie. using longer search words) But the point is, using the normal search words, (people do not use a long trail of search words nomally) I do not see anything except big companies on page 1 and 2 of Google. If you can show me an exception (maybe your own vacation rental?) I am willing to try again. I am not sure I even like my website…it is just put together as their standard format for TravelKeys.com

        Blessings and sunny days !

        Larry Meyer
        P.O. Box 24439
        United States Virgin Islands
        Christiansted, VI 00824

        (340) 773-7493 (Bella Sera, our island home)
        (239) 867-4932 (Ave Maria, FL condo)
        (340) 719-3082 (island fax)
        (320) 248-1911 (stateside cell phone – works only sporadically if I am on island)

    • Try airbnb.com.They kept me in guests through last winter, my first time renting. Not continuously, but enough that I could pay the utilities. I DO get bookings from Flipkey though. They are usually larger parties, primarily Summer season guests, and stay longer, while airbnb does shorter stays for less people. The only thing you need to watch out for is their pricing system. your rates are listed BY THE NIGHT on your calender, and they quote to the Guest by the night unless you fill out the weekly rate form. They also have Instant Book, so be careful if you want first contact with potential guests. There is a 3% fee right now, but of course this could change.

  • Pre

    Great piece. I recommend trying to promote on different portals like Tripping.com. They have an option to promote your listing if you are already on HomeAway, Flipkey or others. See it here: http://www.tripping.com/how-it-works/rentals/premium-placement

  • Blamona

    Another problem is also with “Instant Quote” it’s always wrong! I have a 3 bedroom villa in Caribbean willing to rent to 2 persons, then different price for each extra bedroom DOUBLE OCCUPANCY like hotels do. VRBO doesn’t allow double occupancy, nor different prices for same dates. This in turn makes Book It Now completely wrong! IT also allows for extra persons which we do not, etc. They keep acting like our guests are their clients, but we are their clients! Additionally, sending out info with a “my name” @vrbo when I didn’t write it should be illegal! (The new mandatory Hospitality App) If they want to spam my guests to death it should at least say it comes from vrbo and not pretend we sent it!

    • Hi Blamona, thats interesting…HomeAway is sending guests emails as if it were you?

      I too have ran into the pricing problem, several of our clients operates the same way. They charge a certain nightly rate for 2 guests and then more per person, its not right to penalize your listings especially if their software doesn’t accomodate the different vacation rental pricing structures! Thank you for bringing that point to light.

      • Blamona

        Yes, our guests see emails coming as Blamona.hospitality@Homeaway.com for example, so the guests think they’re coming from us owners. It asks them to download the Hospitality app– then they get spammed to death. (welcome letters? Review requests before checking out, etc). These apps include insider guide (which I have my own thank you) check in, wifi, etc. They sent them out before owners even set up! Only way to avoid is avoid their booking and don’t put email under reservations. If using BIN, they have the email, and therefore the emails. At least they should come from vrbo without our names!

      • I have to say, Jay, that the best rate schedule I’ve seen out here is Flipkeys’! While I’m not overly fond of them, they DO have a very comprehensive rate schedule in place that takes in just about everything we Owners/Property Managers would want to have to be able to charge the correct rate for each property, including weekend packages, changeover days, and seasonal pricing, as well as weekly/nightly, and monthly. I wish airbnb would get on the ball and follow suit! And now there’s a “New Boy” in town, Dwellable, who is planning on getting their feet wet. hope their rate system is up to the task!

        • It sounds like Flipkey has listened to what their customers need. Susan do you mind sharing why you’re not so fond of them?

          I hope Dwellable is very succesful, we could use a mix up in the market.

          • Okay. Flipkey. Their support system leaves a lot to be desired. For instance, I needed support one evening with an inquiring Guest and, guess what? They were closed. That’s correct, closed. ??? Apparently their support team is only available during “Banker’s Hours”, no nights or weekends. Also, extensive waits when trying to call in can be difficult when I have a guest chomping at the bit, so to speak.
            Another big problem involves their connection with Trip Adviser. I never know whether I’m dealing with a guest who went to Flipkey, or one who has booked through Trip Adviser, so trying to solve problems for them is tricky. If I say I’ll call Flipkey and get it straightened out, they say “Oh I booked through Trip Adviser”, then I appear not to know what I’m doing. AND… they don’t ‘Vet’ their guests, so I have no idea who these Guests are, which makes me mor ethan a bit nervous. fortunately, I haven’t had a bad Guest one year into this.
            As far as Dwellable goes, it’s frustrating to post changes with their current setup. ANY change made in a listing has to be pre-approved by them before it’s visible to the Guest! This makes listing a property really exhausting! Right now, there isn’t a charge for listing with them, but I have already been notified this is going to change soon.

          • Thanks for sharing Susan!

  • Love to travel 2014

    Blamona, my husband and I were just talking about the problem with the quote. We are in the Caribbean too and have the exact problem. He has spoken to Homeaway about this for years and nothing. We paid all that money for the platinum package and have dropped down too. It is just so wrong.

    • Blamona

      I actually got a customer rep who understood what I meant about it, because he had 3 same examples with owners in Costa Rica for the same that day–he admitted he was as frustrated as I, and was sending to whomever sets this up and asked me to do the same. Of course I submitted, got a canned response, re-submitted as not a single answer of mine was answered, and of course haven’t heard back. (2 weeks ago) Conveniently, didn’t get the how was our customer service survey for this one either…….hmmmm

  • The Co Founder of HomeAway said this in one of my Linkedin Groups. Do you agree…. Please let your voices be heard…. they’re listening!

    “Jay, this is rampant speculation hiding as “objective'” blogging.

    You should really do direct research instead of publishing hearsay. There is no connection between the request that people begin to use “Book It Now” on their listings and our distribution of 110,000 listings where the managers have CHOSEN to make them online bookable on Expedia. No. Connection. At. All.

    If you did your own research, you’d discover that Book It Now is not synonomous with “online booking.” BIN enables an advertiser to choose how to take the booking–some may opt for immediate booking (although that is rare with vacation home owners and but increasingly common for property managers) but the majority of our subscribers use BIN as a “quote and hold” mechanism. This is good for the traveler because most travelers want to find the right place and stop shopping. This is good for the owner because under that program the traveler commits to the booking before the Owner approves it; the owner has 24 hours to accept or reject the booking. Most owners prefer to screen their travelers using their preferred method for doing so; owners use the 24 hour period to do their due diligence on the traveler. So the reason for us asking owners to add Book It Now to their listing is because it attracts more interest from Travelers. Its really that simple.

    HomeAway remains, and is committed to remaining, the lowest cost method for Owners and Property Managers to book their properties. On average, Owners on subscriptions pay about 3% of total booking revenue for their bookings garnered through HomeAway. No other else comes close to the cost per booking experienced by the average subscriber on HomeAway. (Airbnb, for example, charges 14% per booking–3% to the advertiser, and 11% on average to the traveler, and Booking.com starts at 15% per booking.)”

    So check your facts, Jay, before you write “objectively” about HomeAway. Because what you’re really doing is using our name to sell your services, and I think people can see that pretty clearly.

    Carl Shepherd

    .. do you agree with this? Please let your voices be heard!

    • This is my response to HomeAway Co-Founder Carl Shepherd

      Carl…. You’re avoiding the question, which further confirms at least in my mind that owners and managers should be prepared to pay more to advertise on HomeAway and that is what this post is all about, will you answer the question? I think it is a fair one.

      You said you’re “asking” owners to use the Book It Now option, but what if they don’t want to? Will their listings be affected in any way? Research…… I listen to owners and speak with managers every day who are expressing their frustration of increased pricing, more hassles, poor customer care and fewer inquiries, they complain HomeAway is monopolizing the market, reducing the options that were once available to them.

      I report the news and watch the trends closely Carl, I ask the questions other won’t, with a goal to give owners and managers a voice! At the end of the day I’m here to help owners and if my helping them earns their business, then I think we deserve their business. If your product was truly effective than owners and managers wouldn’t need to buy anything else from me or anyone else.

      My goal is to give owners a voice and help bring change by improving the market and their lives wherever I can, even if that makes people hate me and I become unpopular….. Your attitude further cements the notion of your disconnect with your customers who started you guys out… those hard working owners and property managers, trying to make the most and do the best they can.

      I think if you changed your statement

      FROM

      “we’re committed to being the most cost effective way for owners and property managers to fill their weeks.”

      TO:

      “We’re committed to make our customers fall in love with us” I think that would change everything because the latter would happen naturally.

      People have a lot of resentment toward HomeAway because they feel that HomeAway doesn’t care about them.

      • This is the response I received from Carl Sheperd, Co Founder and Chief Strategy and Development Officer at HomeAway, Inc. :

        “Jay, Jay, Jay. When did you stop beating your wife? That’s a joke, but that’s the type of “questions” you’re asking her. You’re not asking, you’re accusing.

        The question was answered: HomeAway is the lowest cost online marketplace in the vacation rental industry. If it’s not low enough for you, that’s your choice. But since everyone–every single site–charges more than HomeAway, I’d say we’ve proven our point of keeping HomeAway the best value out there.

        And don’t fall for the old “some sites charge only 3%”. That’s to the owner. They charge the traveler 11-15%. We’re old fashioned: if the traveler will pay 11% more, we believe that should go to the owner, after all, she’s the one who has the mortgage, the insurance, and the operating expense of actually providing the wonderful service our owners work so hard to do.

        The use of Book It Now, will increasingly impact rankings within tiers on our products. This has been discussed publicly; it is not hidden, and it is not a mystery as to why. Travelers overwhelmingly want to secure the property online. They want to pay with credit cards to safeguard their payment. There is no difference in ranking, though, between a listing that chooses to use the Quote and Hold version of BIN and a listing that chooses instant bookings. And owners who convert to BIN tell us they close more business because the traveler has gone the extra step of at least starting the booking process.

        Better experiences for travelers beget better booking conversion for owners. It’s pretty simple.

        I also won’t take the bait: it’s very easy to spew platitudes about making “customers fall in love with us”. We prefer to make travelers fall in love with listings and book them. And because we do that better than pretty much anyone else in the category, yes, I think the vast majority of our customers appreciate what we do and why we do it. I’d love to be 100%, but you know what? We’re not there. So it gives us something to aspire to.

        And because we’re pretty good at it, it gives companies who want to compete against us a pretty high bar. We welcome competition, although we question the tactics of “asking the hard questions” and then answering those questions yourself. Especially when that person is not a journalist: he’s a competitor.

        Have a great evening!”

        • My reply to HomeAway Co-founder, Carl Sheperd:

          “WOW! I’m very suprised Carl that a professional like yourself would say such an inapropriate thing. Domestic violence is not a joke! Its not funny!

          The question was will owners soon be paying more for their listings? It was a valid question to share with my audience, I didn’t realize you were part of that audience but I’m glad you chimed in because the conversation has been oddly revealing.

          The question still wasn’t answered but by the way your dancing around the question and giving answers like a politician, I beleive we can read inbetween the lines.

          Its amusing that you see me as your competitor but I’m not in the business of selling listings, however I do send business to listing sites who treat customers well.

          I’m a vacation rental advocate and we talk and blog about things like this and anything that affects owners, managers and travelers. I do wish your approach would’ve been different, you coud’ve turn this around for a positive for your company but instead the tone wasn’t wise.

          The problem is you haven’t had good competition maybe that tide will change, its up to the owners to continue supporting you with their money and properties afterall you do need them”

    • This is for Carl Shepherd. I am advertising on VRBO and HA for several years an luxury apartment in Brussels. We were among the first tu get BIN. We received a booking for two men arriving 48 hours later. They answering their emails not phone calls. I rang HA office from Europe to US and payment and credit card were confirmed. We accept these people. Four days later I received a call from Ireland telling me that the card was not confirmed by the bank, that it was most probably stolen and I would not be paid. The guests were leaving next day. I called the police, but in Belgium they don’t get involved in that matter. These people were male prostitutes I guess part of a network that steals also credit cards. Home Away refused all responsibility. So it is almost impossible to check really who is coming on 24 h. I think that if you get in between you should bear the responsibility and guarantee payment. We withdrew from BIN.

      • That is one bizarre story Maurice. Sorry that happened to you.
        I agree with you, that if you are going to get in between the deal you should be there when there is an issue, especially in cases when the “middle man” makes money on the deal.

        • Indeed. Well they didn’t make money on that (beside my subscription) since nobody has been paid. I lost money on that, since one of them didn’t return a key and so I had to change the lock. This is an issue that is getting more and more disturbing since hotels are more difficult for them with security staff etc. It is quite easy to rent an apartment. We had one a similar case through another agency. They paid but my property manager saw that the two girls (in this case female hoars) were prostitues and since they were smoking and also didn’t have the securyty deposit we refused them. Obviously, money is not a problem. It is almost impossible to check who comes on 24 h especially if time zones are different. The financial arm of Home Away is in Ireland but the staff taking reservations are in America. It can take days before Ireland cashes the money. Do you know how to get in touch with Carl Sheperd?

  • I have said it on other forums and blogs – Homeaway wants too many of my bucks to gain exposure in a very competitive market (my home is in Florida) – there is no way I am going to be paying anything like that sort of money to get bookings from them. $2500 – they have to be kidding. Luckily I have other methods of getting interest in my one home and I have a relatively full calendar but good luck to anyone starting out and thinking that big is beautiful. I already have a booking system in place that does not charge the amount they do – and gives guests the option of paying a refundable security deposit or insurance. They also do automated quotes, with options, replies and reminders. The content is mine not theirs.
    The guests are mine not Homeaway’s and I am their client. What are they doing for me that would make me want to advertise with them – absolutely nothing!
    How do potential renters find my home unless I am prepared to spend a lot of money with them – sites with limited numbers are much more interesting to me – if they rotate listings too – not based on how much I pay but just that I am listed. I do not have a multi million $ home – I am not made of money – I try to run my business so that I am not subsidising someone’s vacation. Homeaway has ruined many smaller sites that used to generate interest for me and lumped everyone together in huge sites – as soon as they take over my enquiry rate has gone down – same house, same everything else- so something must be wrong.

    • Thank you for sharing your expereince here. I want this to be a place where owners like yourself can speak freely without censorhip or worry of someone shaming you for having an opion they may not agree with. So thank you for being courageous to speak about something you feel strongly about and posting your comment on our blog.

  • Larry Meyer

    I am not understanding MoorgateVilla’s claim of a $2,500 HomeAway listing fee. they start at $349. And while I disagree with Carl Shepherd’s claim that they (Homeaway) are the cheapest listing service ( they are not), they DO come out the cheapest when I divide my annual listing fee against the bookings they send my way. I do not see how any listing services can really compete with them….no matter how you word your search word to find a vacation rental , it is HA/VRBO/VR.com that dominates page one of Google and that is how the battle is won and lost. Pretty scary, yet admirable, what they have achieved for just one company to so dominate the business.

    To Jay, I want to thank you for opening this very important discussion. But in Carl’s defense, I would say that he was only using a very OVERUSED example of how one can word a question so that no matter how you answer it they are in trouble. Don’t think he remotely meant anything related to your wife or domestic violence.

    I might consider Book It Now if there was some way to have more than 24 hours before contracting to turn over the key to my multimillion dollar investment. But the other problem is that they quote people a price which is almost always wrong. So I have to background a potential renter AND try to explain why the price they were given was wrong. ( We do not charge using HomeAway’s strange “____$ for each guest numbering over _____persons.” ) So I get penalized a bit by not using BIN, but it is not the end of the world. I just hope they do not start penalizing us in rankings by not using their Hospitality tool – I do not like that because it only results in a blizzard of spam for my poor customer. I actually think HomeAway is putting a bad taste in the mouths of travelers by overdoing that. Beyond that, I like Homeaway….they are a good value for the money

  • Adam White

    Jay, I’m not sure you can answer this…or no one knows right now…Will this effect the software that homeaway provides for VRMs – like Escapia?

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