The instant booking model is the one that everyone prefers, with the exception of a few. In a Skift article, Andrew McConnell from Rented.com called those few “the minority.”
He stated it’s an illusion that people are in revolt against online booking. Here are his exact words:
“You get a very vocal minority [objecting to instant booking], which gives the sense that everyone is in revolt,” says Andrew McConnell. “In reality, inertia is a powerful force — people are already tied into the major platforms — and that is where the rental demand is. Plus, consumers prefer it, and they are the real customers after all.” (Skift)
I thought that was a very interesting comment, and I wonder if it’s really true. I wonder because nearly all owners and managers I speak with each week express the same frustrations.
Are we the minority?
Is Andrew wrong or is he telling us the hard truth of our reality?
The reason instant booking for vacation rentals is building momentum in the marketplace is because it’s what travelers want. This is what we keep hearing.
Travelers don’t want to wait for a possible approval of their reservation.
Travelers want instant gratification–they want instant bookings.
In the day of same-day deliveries, instant downloads, and expected website load speeds of under two seconds, there is definitely truth to people not wanting to wait.
We wonder if travelers are willing to continue paying considerably more money for booking online with HomeAway and VRBO, and if they really care that much.
Which brings us to our next question: Is online booking worth the service fee of up to 10%? And is the fee sustainable if other alternative booking platforms become available?
I’ve heard owners and managers express their complaints that there is no additional value added to the transaction for such a substantial fee, but does it even matter?
With messages like the one we’re hearing from vacation rental executives like Andrew, it can make us feel like the battle for bookable properties is over. We question whether it’s best to stop resisting and submit to their new rules and fees.
Are most owners and managers “all talk” when it comes to listing site independence? Do they just complain about online booking fees or have they unified themselves and made steps to improve the industry?
Do owners and managers support change and new opportunities? Do they believe it isn’t probable to create change, and therefore do not support new alternative platforms like they should?
Have the majority of owners and property managers already given into the traveler booking fees Expedia imposed? Have you?
I’d love to start a truthful discussion of where we are halfway through 2017. Please share your comments and thoughts.
So many apples and so many oranges here.
1. Online booking does not necessarily = instant booking; one still can book online with X number of hours confirmation (if on the OTA platform).
2. also, for example, if someone submits inquiry via my website/Facebook online form, my ownerrez system instantly quotes them and also sends them email auto quote, they accept and pay a deposit by CC – that is by definition online booking ( meaning they did everything online – no “check in mail” stuff.
3. Owners resist “insta-book” not because they are being retrogrades (of course there are some), but because owners – not OTAs – have to make sure to comply with local ordinances, noise ordinances, occupancy limits, parking restrictions, and bear the responsibility (and cost) of things going wrong with a frat party that insta-booked. OTAs will not do that – their interests stop once the fee is collected. If an owner does not make sure that 8 people are not coming when insta-booking was made for 4 people, soon ST rentals will be banned by irate locals petitioning their city boards.
3. OTAs would want travelers to believe that insta-book is only possible thru their platform – not true again – many owners run their own websites backed by the likes of ownerrez, bookerville, IVOL etc that TRULY offers instant booking (including electronic e-signing of rental agreements).
I have a feeling that analysts espousing the inevitability and virtue of insta-booking
OTAs would WANT all of us to think (and themselves believe) that VRs are like hotels : ALL have 24X7 staff and front desks, and are all lookalike (like hotel, rooms, again) – think condotel. Sure some are – some big condo complex may have reception desk (that won’t allow group of 8 check into a 1 bd “unit”). But it may come as surprise to them that:
1. Not all VRs are in some “resort” with 24X7 front desk.
2. Some may be in a location that requires guest/owner communication (ex on an island where getting there requires specific ferry) – without talking to owner before booking potential guests will have trouble even getting there
3. Some owners prevent insta-booking not because they are retrogrades – but because they don’t want renter to get into something that is not right/suitable for them
4. Insta bookings breed attitude of insta-cancerllations. Which is no loss for OTAs but may translate into big losses for owners.
5. The big cringe-point for me is when the OTA’s and OTA-centric “analysts” say ” this is what travelers want”. This is like polls or surveys – the answer depends on how you ask a question. I am sure if you ask travelers “do you want a free vacation” – 100% will say “yes”. does it mean we have to grant it? There should be a balance between someone’s “want” and someone else “can deliver” but OTAs are trying way too hard to shift the balance in former’s favor at the expense of the latter. At this point they should pay a little more attention to what owners want (or rather <>> to stay viable and comply with local laws) and not just try to deliver on every which one of traveler’s “wants” which they (OTAs) themselves determined by their suggestions
Andrews view is slanted his business is focused on property management companies and leans on the side of larger companies with more inventory obviosly. Property managers dont feel the same way about instant bookings as owners do. They want us, owners of the inventory to just shut up and let property managers and listing companies to have their way with our property.
I agree Josh.
I too concur! Thanks for calling this out and giving us the opportunity to speak in contrast of what is being said. If lies are consistantly repeated they become true at least to some and we need to let others know not to be swayed by this. DO NOT give up the fight for your business.
I agree too
I second BlueMountain Lodges comments below. I am online bookable also, just not through VRBO, et al… so I’m sure they don’t consider me online bookable as I do it outside their “system”, I email, answer questions, and visit on the phone with my potential guests. I then send them a link to book online and they don’t consider my “system” difficult at all.
The executives pushing their own agenda will continue to parrot the party line and ask their questions and interpret the answers as they see fit and as it suits their bottom line. The problem is that what suits their bottom line and mine are at times two separate things. It really doesn’t need to be as I do think we don’t have to have a system that is adversarial but it seems as though those of us that don’t want someone getting into the middle of our businesses are being forced into an adversarial position or a position of surrender. I choose to not surrender and hopefully continue to maintain my business and serve my guests the best I can.
I try to support sites that are trying to be independent, I also renewed my VRBO ads for a couple of extra years before the “have to” deadline of using their booking system, hopefully by the time it expires I will truly be ad site independent or able to just use the ones that support the way I want to do business.
For what it’s worth, I own one VR and manage for 3 other owners and definitely do care about who books their VR’s. I use the same system to manage theirs as I do mine.
Hi Wendy! They have been making small changes over time that now looking back- we know have a led us to this point. How long will it be until we only have the option for instant bookings? We are following a model not of VRBO but of Expedia where all other properties right now are instantly booked. I think that one day there will be no difference between online booking and instant booking. It’s how they get us in to instant bookings. Slowly…
NO, I have not accepted and never will accept the 10% fee of Expedia. That money needs to go to the people cleaning the house, to upgrading the website, to newer linens or furniture, to fresh flowers or orchids or wine for the Guests, to an organization that is going to fight scamming, spamming, a million more, but NO to Expedia. I give HomeOwners, Property Managers, and Travelers too much credit to go along with this “hidden” fee any longer.
Consider the source of the quote of what most people want. Someone who works for a company with 0 inventory/product. What is more telling is what most owners want. Most owners don’t want to let anyone that can pay have free reign over what is at minimum a 100K investment and up, way up.
Nope, haven’t given up. As small as we are, on a distant Caribbean island. 14-20 wks per year is our goal. The corporate giants do forget we don’t have the same goals as they do and some of their inventory hosts might have.
For us to book every night, the wear and tear on the home is too much. We don’t have the luxury to call “rooms to go ” to replace damaged furniture and furnishings. We don’t have the luxury of cheap labor and repairs. We don’t want those guests that don’t respect our home. we still wish to engage with the guest to make sure it is a good fit for their expectations. I have no problem referring some to properties more suited to their needs.There are plenty of wonderful guests and we will continue to market to that group directly.
We are travelers ourselves and will never spend a dime with an Expedia company, of any kind,ever again. We can be part of the “acceptable losses” Expedia MBA’s have figured they will lose, so why keep fighting them, we will continue to market elsewhere and we are pretty happy so far. While we have almost zero inquiries now from VRBO, (we are penalized for not conforming and staying subscription) They will never care about the homeowner customer. Andrews comment about the “real customer” says it all. Well, the word “no” is a complete sentence. Use it often. No.
They should ask the question right. What they ask tavelers ‘ do you prefer instant book?” of course most will say “yes”.
Now, if they asked “do you still prefer to instant book if it costs you 10-15% more above the listed price”, I bet you in over 50% of cases the answer would be “no, I can spend 10 min more to save 10-15% off my vacation”.
But they just don’t ask that question, do they?
I find very FEW of my guests want instant on line bookings! Most new guests want to establish a relationship with the owner to get a “feel” if the property they are interested in reserving matches what they want! That can only happen with a conversation via email or phone with the owner. I tell all my guests that the additional fees that Expedia and others are charging are unfair not only to them but to me as well! I have been using the Home Away site for more than 12 years and it wasn’t until they were bought out did I become a disgruntled VRBO owner. I also continue to find ways to circumvent “the system” for the benefit of my guests.
The comments of McConnell are self serving and untrue. My 15 years of experience has shown guests want a personal connection not instant booking to feel more confident in their vacation rental choices.
Andrew forgets that each complaint represents hundreds of others who feel exactly the same but don’t voice their opinions. Expedia is holding us hostage and I don’t like if one bit. The day will come when they’ll collect and keep our money until after our guests leave If we sit down and take it now. One of our guests said Expedia called them soon after they reserved a flight to ask if they wanted to book tours. Tours are our concierge’s bread and butter. Expedia has to recoup the 3.9 billion they paid for Homeaway somehow. This is only the beginning…
Online booking is one thing, and instant booking is just ramping up online booking. Statistically, at least for my property, online bookings happen about 1 in 7 inquiries, and instant booking happens 1 in 20. Most people still inquire, ask questions thru 2-5 email exchanges, and then book, Since online booking came into play, all of my bookings have been booked online by credit card. Gone are the days of wire transfers.
Since the homeaway service fee came into being in February of 2016, inquiries dropped like a stone. I began to look for alternatives.
I cannot justify Jay William’s, or any other subscription price VR site without some evidence that it works. One could go broke ponying up a fee for the many players out there who say they have the solution. i have emailed his site several times, and never got an answer to any of my questions, except that someone would call me. That return call never materialized. Calling a toll free number in the USA cannot be done from where I am, but I can call a regular phone number if it was published.
Testimonials for the newbie VR sites are everywhere. Free trials are not. Any owner would be a fool if they didn’t subscribe to a new venue that proved they could generate just TWO rentals, or one that offered a pay per booking platform.
Bookings are down, for my property, and 26 other properties in my owners association.
So, it’s a crap shoot in the VR arena, as far as i can see. Homeaway, keeps saying it’s going to get better. Newbie VRs say they are the future. There are so many VRs with more coming online all the time, so “how do you choose”?
https://uploads.disquscdn.com/images/7ca10a4819be7c701fcb37a365ad826be45c28e2973eed2e8ff2f21eef7b1242.jpg
If things weren’t bad enough Homeaway is not refunding service fees to guests due to a cancellation if the owner holds onto a cancellation fee. They tell the guest to collect the service fee from the owner who never received it in the first place.
Why on earth would Homeaway ever think I would need to use their payment system when they only continue to implement such customer unfriendly policy. I would NEVER let them get between me and my money. I also refuse to implement credit cards. Just another third party between me and my money. I only deal with personal checks and the rentals must be paid thirty days in advance so I am assured it will clear. Who wants any third party between you and the potential for unwarranted customer chargebacks? If I only have a seasonal rental for the year that is my entire year’s income. No way would I not want to be in control of that payment.
There’s no reason, with the digital tools available today, that an engaged owner can’t offer that ‘instant booking’ option from other direct marketing with the added bonus of a personal touch. I think for every guest that wants instant booking there’s another that prefers to find out more about a property or destination before confirming. After all, isn’t that why the market for independent rentals grew in the first place? The two options don’t have to be mutually exclusive and owners should still be able to choose how they allocate their marketing budget and efforts without being made to feel as if they are a minority. Andrew’s loyalties (and dare I say bias?) are clear but I would say it is still opinion not fact. For owners who don’t want to be dictated to, there are still options open to them.
Andrew’s comment was a strong statement to make without data to back up that claim. I tagged Andrew, in hopes that he would clarify his thoughts for us. . If he cant provide data it might just be #FakeNews With this coming from a VR executive in the industry and from a reputable source like Skift – the community should address this if they feel it isn’t true. But in his defense there have been many owners who have agreed with him and said things like this
“Unfortunately, I agree. Change is inevitable. I hate it, but there are many bigger fights for me to fight anymore”
Here’s another comment from an owner – “It’s the new business model. Sorry people but the old way of doing short term rental is going away. The younger crowd prefer the easy and quick click to book without the interaction.”
Jay what you have shown me is that we as owners aren’t on the same page. How are we supposed to win a “fight” when we arent really all willing to fight?
Exactly!
I do not think we need to “fight” OTAs per se, it is pointless. let them do their thing, as we disentangle and become less and less dependent on them. Use them when it suits you, don’t use when it does not. I am sure OTAs will work fine for “commodity” /hotelized type rentals – with reception desk/management on site and multitude same/similar units when renter does not really care whether it is unit 401A or 503B they are renting – they have same size, floorplan, amenities, location etc. In that case “hotelization” IB experience may work and may be even to owner advantage (onsite reception desk will weed out over-size party or renter trying to bring a pet or will curb down renter behavior should they get noisy). For the rest of us with standalone properties, properties in more residential and/or unique settings, or properties with specific restrictions IB is NOT the way to go no matter how much OTAs want it to be. After all, we have to remember its is our investments on the line – not OTAs. It is our VRs that can be banned by local municipalities, putting us out of business – not OTA’s. So each owner should examine and see if we can safely uses OTAs, or just use them to a point, or not at all. And make netx steps based on the findings. I do believe that , in the end, will be enough individual owners/listings not suitable for IB model that would spill over into local/alternative listing sites and settle there. It is just owners have hard time of letting go of the long-standing VRBO model that woke for them but is no more.
Good points Victoria! I agree we as individuals have to do what is right for our investment property. I think the fight is not so much against the OTA’s but rather a fight for survival. We have to make adjustments and evolve our businesses if we are going to exist and not become extinct.
HomeAway/VRBO (Expedia) rates owner’s higher on the search list if they are doing online booking. Many of my clients often pay by check to avoid the “joy of booking online” fee. Travelers are looking to save dollars and 10% relates to a very nice meal or purchase. Therefore, I am penalized when guests pay by check, by not ranking as high in the search engine compared to owners that accept only online booking. Between changing their algorithm, charging additional fees and taking my phone number off my listing I have noticed a sharp decline in booking inquiries. I am paying them for a listing, not to control my business.
Jay, I left a couple of phone messages within the last weeks. I look forward to hearing back from you soon. Thanks!
: )
Jay, but is the “younger crowd” are customers? Do I really care what a 18 year old ‘prefers” because by the time he/she is 40 and finally becomes my customer, his/her preferences may change? And by the way why was my post deleted?
Jay – Thank you for the mention. A lot of good comments here, but want to start with the data as that seems to be a concern. According to HomeAway surveys, presented at VRMA conferences and others, over 90% of guests when questioned state they prefer “Book Now” functionality. As I have not personally run this survey, I cannot verify it. However, as I think we can all agree, Guests are the primary customer for HomeAway. As such, they would have little reason not to be truthful here and provide those Guests with what they want.
Several comments also question my objectivity in this matter as my “business is focused on property management companies.” This seems to be a misunderstanding of what Rented.com is, and what we do. We are actually a marketplace that connects homeowners and managers, just as VRBO/Airbnb connect owners and managers with Guests. We have no reason to be biased towards Managers at the cost of Owners, as Owners far and away make up the larger, and more fragmented portion of our marketplace.
My observations are a result of working with tens of thousands of homeowners, as well as roughly 1,000 different Managers. Perhaps the ones who work with us are not representative of the majority, but it seems just as likely that the people who love managing the properties themselves, who spend a great deal of their “free” time engaging in online discussions and researching the industry, are the ones not representative of the majority as well. Hard to prove one versus the other, but think both sides need to at least recognize the possibility.
So yes, I agree there are those who hate instant booking, and there are those who love it. There are also a lot of people who don’t care too much one way or the other. I am not trying to sell one viewpoint versus another, I am just sharing with people what I have observed over the years working with homeowners, managers, and the big booking sites. I pass no judgment on if the changes are “good” or “bad.” I simply state what they are.
Hope that helps, and I wish everyone the best.
Sorry, but I have to disagree with your statement, “Guests are the primary customer for HomeAway”…could not be further from the truth. We, THE OWNERS, are the primary customer for Homeaway…we were there first! Without owners, Homeaway has no business…therefore WE should be HA’s primary customer they are going to bat for.
Their strategy has changed which is exactly why they are losing many of us to other strategies. Less than 15% of the owners in my market are using “Book Now”, but I am sure HA will force us to use it in the future. The “Bully on the Block” is the nicest way I can put it to describe HA at this point. They have taken what was originally a great concept of a personal relationship between Owner and Guest and turned it into a controlled, impersonal environment where we, the owners, have very little control of our own administrative procedures…and paying more than ever for it in addition to the guests now being charged. Ridiculous and very frustrating for all owners. I will do everything I can to prevent myself and my guests in the future from having to pay ever increasing fees which get them almost nothing in return. – Chris A
Chris, just to clarify, I was not saying Guests should be the primary customer. I was just making the observation that given their business model, the sheer numbers on the guest side, and the fragmentation involved, in reality, that is who the business sees as the primary customer, and for whom they will design their product. Not a judgment of should or should not. Just a statement as to the current state of the situation.
Hey there Andrew, thank you for taking the time to participate in the conversation!
Andrew, do you know HOW the questions was asked? Is it a secret that one can get any “survey” results they want based on how the question is posed? I have example before. Were they asked ” do you prefer to book now” (whatever definition of “now” s ) or ” do you prefer “book now” even if it will cost you 10-15% more; or if there will be no-cancellation policy (or number of other things)”. I am sorry, this statistic as it is presented here to us has no more value than saying “100% of dentists prefer teeth”. And no matter how much denial HA is in, without OUR homes (aka “inventory”) that has to be in compliance with laws and rules, to which book-now is not conducive, HA will not have THEIR customer. I wish HA remembered that every now and then… And it is, to me not so much about “hating” or “loving”. It is about what is feasible and prudent, and what is not. It is not about emotions – to me at least.
Well Jay you finally picked a topic of interest to everyone. 32 comments. Pretty good when many blogs are never responded to.
Have to add a few thoughts here and there is no simple answer, its far more complex than a yes/no.
We have lots of data and surveys and information and spoken to many guests and managers. Each rental needs separating into categories to understand the
issues and relative opinions:-
– Cities
1. Budget price city short stays. Much more likely to see guest instant book expectations, regardless of platform.
2. Higher value city short stays and long stay budget more likely to see need for more information and communication.
Big brands are more likely to witness instant bookings due to loyalty, trust, city knowledge and look to book process plus brand big budget spend.
City businesses are more likely to see Airbnb and Booking.com as preferred channels. Managers and owners need dynamic technical integration.
We see lots of businesses pushing to this, but are still strapped by on the ground issues and higher base costs than hotels, but greater workforce opportunity.
Higher yearly footfall and opportunity (plays to easier cancellations) but tempered by volume and now local govt regulations. Often bought for investments not as second family homes.
– Traditional VR (self catering & holiday rentals/homes)
More seasonal and restrictive on stay times (7 day, 14 days etc).
More disparate locations (from a few to 40 miles apart). This often demands seasonal workers, higher base costs (transport, training, less time per unit). Owners may have bought as second homes and due to the locations as as a getaway, so more personal use.
The lower footfall, the restrictive seasons, the personal use and the higher cost bases mean less margins. The cleaning and management is more complex and has always settled on “change around” days to consolidate work schedules easily.
Prices are higher, the trips are often more family orientated, locations not well known. This lends more to communication, detailed requests and local knowledge, also
leading to price questions in the process. Families come with children and often pets and larger homes attract groups. The bigger the group the more likely the questions.
Owners may insist and managers may need to vet these guests to ensure compliance to both their rules and local govt laws.
Calendar integration is important and so is accurate pricing, but less demand for instant book due to both guest and manager needing to communicate.
– Geographical
Some parts of the world are more reliant on and want instant bookings due to the property types, taxes, management approach etc. This is big topic and cannot cover it here but China is different to Cornwall.
– Age
Certainly the young generation want instant gratification and slick transactions and many manager sites don’t offer this and big brands invest in online trust. Few guests
realize they pay too much via OTA’s, but education is always very expensive and requires very big budgets to change this or technology to facilitate it. The young will become the older of tomorrow with families however.
– Business Sizes
Small companies and owners know that conversions are so much better with personal contact especially when they are followed up, have carefully curated messages and use
tracking etc. Larger companies (and there is lots of acquisitions going on) cannot be a cottage industry at scale and are more likely to try push to instant book. Fine in cities
but still have regional management and guest question and vetting issues. Many have a 24hour/owner approval clause, which cannot be traded across to the OTA’s.
– Online Booking.
For sure most people want an easy life and credit cards offer security of charge backs and fraudulent use, a credit line and loyalty points. The point at which and when
the guest pays is the disputed or a non-highlighted point in the surveys from HomeAway etc.
There is no simple answer, but provided there is an oversupply of accommodation on an OTA, then the marketing muscle and spend will see them grow. Those managers who can do one night, have free cancellation, no security deposits and good reviews will rise to the top, its an easy guest target and sales message, but currently limits choice.
Their focus is often at odds with a guest as well, so it makes sense for these sites to be hybrids despite their current drive.
One thing is sure for everybody, make payment and booking easy as possible, wherever it happens. Get the booking, do the paperwork if necessary afterwards. This is the OTA strength and forcing this on their marketing platforms for the more traditional and real VR’s has been a challenge, not yet met.