Here’s how credit lines, wire transfers & niches can help your direct bookings

It’s a tall order in a world of big business. No wonder, with so much interest by large corporations hauling a growing world of mixed inventory into their silos.

No doubt about it, they fit a part of a mixed marketing strategy, so don’t ignore them! However, concerns on control, pricing, margins and terms mean there is little actual love in these relationships. Hotels have been facing these problems and now have a world of new businesses starting up to help them be in greater control. They even have their own Direct Booking Summit.

What else can be done apart from the usual advice on websites, smart payment methods, correct on-site messaging, great media? Get all these right but think out of the box and focus on the things large companies struggle with. Here are a few thoughts and businesses that can help to ensure the guests come directly to you.

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Niche markets & potential growth opportunities. What’s your niche?

This weeks post is about exploring the growth opportunities for owners & managers by focusing on niche markets.

It’s becoming impossible to compete with OTAs at a global level and this article explores why niche markets are the potential answer.

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What does the term “luxury” even mean anymore?

A 10min read exploring the term “luxury” in the vacation rental industry and how its overuse has led to different meanings. What does it even mean anymore?

This is a tough one as its all relative to who you are,  your standing, experiences, wealth, perception, philosophy and beliefs.

The world’s 62 richest people now own as much wealth as the 3.6 billion people who make up the poorest half of the global population, according to a new study by Oxfam.

Undertaking another survey of this group, based on the perception of luxury, would probably see some surprising results, but overall, luxury would be a term that has a linear correlation to income. The lowest paid people make barely a $ a day, which would take them over 40 years to stay in the most expensive Savoy Hotel suite for one night or a “Luxury” villa for a week.

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Would you like to speak to a human or machine sir?

A 10 min read about the rise of voice search, chatbots and the future role of artificial intelligence (AI) in the travel & the vacation rental industry. 

Good Day Sir, Thank you for calling “Advanced Vacation Rentals”, would you like to speak to a human or a machine?

It’s an interesting thought. If by any chance you can find an actual phone number in the future, then perhaps the chat bot or artificial human at the end of the line will ask this exact question and qualify it with an option or two.

“Please note booking with an actual human interface will add 10% to your booking, you will find this at checkout under HSF (Human Service Fee). Our specialist, Silvia Turing, however is free and would be happy to speak to you, she is lovely and costs no extra!”

We hear and read a lot about “robots”, “voice search”, “artificial intelligence”, “big data” and the “internet of things”. So whilst the owners and managers of rental properties lie around pools, play golf or are fully V.R. immersed (that’s Virtual Reality this time) on the beaches of the world, guests will settle for a machine. They will be safe in the knowledge that Silvia will have all the answers and instill confidence.

The “machine” will tell them the type of linen they can expect, the local council’s parking charges, what the beach camber is like for safety of the kids, the best place to celebrate a birthday for vegans and recount the joy of paddling down the local river at sunset (but make sure the tide is in however).

Apparently, technology and in particular voice management combined with AI will change all this. It will help remove more of those expensive staff in the hunt for progress and in so doing establish levels of trust and connectivity via automated systems, which so far have been out of reach.

Is voice search the future?

Voice search is the buzzword and will be far more specific because it’s still easier to speak than type. Bolt on significant advances in translation software and we are moving to a verbal digital environment that covers the globe connecting all of humanity. The varying cultural demographic makes this substantially more difficult of course, but the intent is there and with a lot of funding and innovation supporting this movement.

Imagine the non-English speaking part of the world coming alive through native, real-time translation connected via the net and the opportunities are boundless for travel, commerce, cultural advances and other less desirable impacts of course.

Better conversational interfaces

Most people do not engage at a deep and meaningful level with their current technology for search and still require answers to simple well-defined questions. Instead of typing “villas in Koh Samui” and scrolling through thousands of search results, it’s easier to ask “Find me a great villa, in a quiet location with… erm… a heated pool, hmm yes and make sure it’s close to the beach in Koh Samui… but… it must have 4 bedrooms for under $5,000 per week in November, actually… December”.

Voice search is predicted to be huge and is rising rapidly as shown in this Forbes report. Windows Cortana and Apple’s Siri are all entrenched in operating systems on desktops and mobiles but still suffer consistency and interpretation problems.

Once a search is completed for that ideal holiday destination and a few questions need answering, then it’s over to the phone or to chat online. Sylvia Turing (our future winner of the famous Turing Test), mentioned above, may be able to answer questions with aplomb eventually. This relies on deep data access and AI to provide a “human-like” experience.

In 2014 the pre-requisite 30% of people believed they were talking (via a type chat scenario) they were speaking to a 13-year-old. So it appears that it’s coming, albeit slowly!

There’s going to be more personalisation & more exposure of your personal data

Now add in hardware to the software challenges and we have a multiplicity of options. Amazon Echo, Google Home, are both novelties and great for playing music, asking personal questions and getting the weather forecast, but it’s the beginning. They will see screens added, perhaps VR equipment, translations and will hook into massive data systems. These will be commonplace in homes and can dive deeper into your personal life. On top of this, the other internet of things will have also curated you and your life, so predictive intelligence will come to the fore.

Your diet habits, bedtime routine, YouTube recommendations, salary, driving style, health requirements (let’s hope this doesn’t happen), family’s likes/dislikes and much more may be extremely well known. Confronted with this subliminal information, the optimal most personalised holiday destination, accommodation, restaurants, car hire and timing can all be offered up.

Whether this is presented as definitively as possible or is influenced by corporations sponsors or margin calls, will determine its real usefulness but can be considered “Connected Intelligence”.

The goal for machine is to understand intent & deliver results across multiple cultures, languages & technologies

Through conversation, we establish, build and strengthen relationships. A conversational interface is different and requires a seamless experience for the user. A simple chat bot or messaging system does not form a relationship or association. The goal is for the technology to disappear and for the user to forget about the interface. The system must be able to determine intent and develop through conversational association a trust acceptance level, let alone answer questions that may only be available offline. Doing this with language barriers, dialects, cultural nuances and technology barriers is not so simple.

Are we currently in the worst of both worlds?

We aren’t there yet by any stretch of the imagination and that’s where the traveler suffers. The industry is so hell bent on enforcing simple rules that can be interpreted without supercomputer machine learning and removing expensive humans from the travel process, it’s potentially the worst of both worlds right now.

It’s now possible to book a flight, take a remote controlled car to the airport, check in the bag automatically, collect a pre-booked car without speaking to a soul, check into a hotel or Airbnb without human interaction and return home the same way.

It’s unlikely the average person will be able to do this without issues on the way. Online promises are fine but on the ground, daily issues such as strikes, coups, traffic, weather, disease outbreaks, fires, road closures, terrorism, other travelers issues and more will affect the smooth running of any chain of travel activity.

That’s where problems occur as it often needs a human to sort the problems, but there aren’t enough souls to go around and they are generally overworked, socially removed and now quite angry!

Technology has exacerbated the problem, not solved it, sucking more from a decreasing labour force and applying tech to add more to the bottom line.

Humans are social by nature

Ask why Facebook is so popular and so many people now use it daily. Humans are social and have a million years of personal interaction. The Chameleon Effect, for example, is a powerful tool in the war on automation. It does mean seeing the prey first however and the drive to distance connections in favour of revenue reduces opportunity reduces this.

Social has moved online and is developing. How many people do you see communicating by text, chat, WhatsApp, email these days rather than talking even at a close distance? Facebook is the prime mover in the western world for social networking and is a phenomenon that cannot be ignored in this context. The reason for its high usage and success also highlight Airbnb’s social and site profiling.

This article explains well the need to belong and the ability to portray a well-considered personality which actually dilutes the chameleon affect.

Millions of years of social evolution are being changed via human neural network adaptations and no doubt being imprinted on the human genome too.

The problem with all this, is that distancing human from human leaves doubt on identity & intent and means both sides of this social equation sees reduced trust and empathy. This is one of the reasons fraud has moved online. Humans can determine trust more accurately with actual real life interaction.

So human or machine Sir?

Right now, in an ideal world, it’s human for me. There is absolutely no doubt Silvia Turing will become more human and perhaps fool all of us, but for now, she’s a database of outdated information and no real world experience especially at a local and continually changing environment.

After trying An OTA’s suggested helpline number and asking for information on a small village property in Devon and speaking to an unintelligible accented person in the Caribbean we know that this is simply damaging a booking opportunity, if not the marketplace itself. This illustrates the need for true connectivity, not call-center incentivised screen read replies.

What can you do, as an owner or manager, to improve your situation going forward?

  • Voice search is very important going forward, humans like to speak questions. Create very long tail popular search pages, with the definitive answers.
  • Use the “belonging” social approach of Facebook and Airbnb and collect all your reviews into a “friends” collection and get to spend a few moments with each guest or at least call them to make sure all is OK and you do create a connection. You are as important as the property quality. How many times have you seen reviews that say “Tom and Julia were such great hosts……..”
  • Let people know, on your own site, they can book online, push them to some great FAQ’s BUT make sure they can see how to contact you by phone and email and even WhatsApp or Facebook. Use the phone as a priority, it will help you identify the potentially challenging guests and allow you to activate the chameleon effect: interests, places you have been to, birth dates, friends, experiences, places you have both visited and more. Its what humans do best!

Metasearch Engines & Vacation Rentals in 2017 – Everything You Need To Know

The hotel industry has been in “meta-land” for many years and has accepted it as part of the booking landscape. Like many parts of the VR ecosystem, it is now becoming embedded in the rental space.

Should this concern you? The answer is (as usual) not so simple and is entirely dependent on your current business set up, location, management, technology and brand development.

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Rentivo welcomes Klik.Villas to the family in recent acquisition

LONDON, June, 14th 2017 /News Release/ — Rentivo (rentivo.com), a holiday rental booking management, payment provider and marketplace builder has acquired Klik.villas a complimentary booking management software provider with associated marketplaces and sales & marketing services specialised in the Asian markets.

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It’s all about luxury villas these days!

A 7min read diving into the “alternative accommodation” sector, looking at where & why the money is heading towards luxury villas & high-end properties.

Dreaming of a holiday? What is the first thing that comes to mind for most people? Perhaps its visions of warm sunny days by a pool or overlooking a calm deep blue ocean with white sands. In winter it may be snow clad ski chalet with wood burner and hot toddies after a day on the slopes.

The big corporations know this and are refocusing their attentions on higher value, luxury, family experiential accommodation. The arguably incorrectly named “alternative accommodation” description is gaining ground and bringing more traditional vacation rentals into the mainstream fold with all its corporate service support.

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Thoughts on “Scaling Hospitality”

An article in Skift caught our eye this week and highlights further the complexity and challenges facing managers and OTA’s alike.

Vacation Rental Managers don’t have the tools to scale hospitality

The rapid insertion of OTA’s (such as Airbnb, HomeAway, Booking.com, VRBO & TripAdvisor) into the booking chain has caused disruption, discontent and disaster for some managers and now the challenges are mounting and it’s not just bookings but ancillary sales and service as well.

The report from Hostfully covers a lot of areas and has several well-known contributors have added their thoughts, such as Eric Mason.  The report includes references to gaining platform independence, a word we have heard a lot lately and not just in vacation rentals.

Although the article has some focus on the ability for managers to technically support extra services, specifically with a management solution (PMS), this also brings into question the ability of OTA’s to refine these services at such a detailed booking level if supplied to them by managers.

We all know distancing guest from owner and managers further is necessary for any OTA to try and plug in more revenue opportunities and reduce the financial leakage through guests seeking direct contact. The addition of service at a local level with manager complicity is yet another and even harder task to manage. Currently, this can only be achieved through scaling and consistency across borders and central supply.

Current industry focus

This comment below from the report/article summarizes what most of the industry have been focused on recently, seeking new avenues and reducing dependency on single channels. Note the comments on re-targeting, websites and multi-channel distribution.

This growing desire for more direct business, Jacoby noted, was reflected in the fact that the top complaint among respondents was about the recent changes HomeAway has made to its booking process, making it more akin to the online-only process found on platforms like Airbnb.

“What we’re seeing is a focus on more platform independence,” Jacoby added. “Property management software where you enter your property on one place and it lists it all over multiple sites, and that syncs reservations across all those platforms, is growing, as are marketing websites that help vacation rental managers build their own sites and focus on retargeting ads on other sites.”

Key takeaways from Hostfully’s “Scaling Hospitality” report

There are also few key comments that the survey produced, a graphic of one is shown below:

Vacation Rental Groceries

The survey is clearly spread over a widespread geographical area, a percentage of high-value inventory and/or international destinations. Inclusion or a personal chef within the results seems to illustrate this, but the report highlights the importance of food-related services.

Are the right tools available?

There is no doubt that providing extra services is an option many guests will adopt and on occasions need. That said, the ability to provide these services comes with headaches. Those that can be provided by OTA’s under OTA only control will be limited and food-related services are the hardest unless mainstream brands or restaurant API’s (such as OpenTable) are integrated, but these are not on-site.

Any property management system worth its salt should be addressing the opportunities to align incremental services either through direct input of information into the PMS with aligned reporting and scheduling or via API’s who integrate seamlessly and remove the pain of actually providing these services (such as Vreasy).

Direct input of this service data into a management system (for example details on groceries, prices, delivery times etc) can be complex and almost impossible to synchronize with an OTA who are not set up to accept data from literally a world of differences! They prefer the navy KISS system!

Technology isn’t the only problem

The market is segmented into urban (seems to be latest buzzword for everything) and non-urban, which could be anything from a resort complex of apartments, to a lodge in the mountains a yurt in the countryside, a campsite in the jungle, a castle in remotest areas, a villa on an exclusive island or a cottage by the sea.

The market is also controlled at source by owners and not all owners have the same needs, desires, opinions and cost acceptances, despite managers pushing for consistency. Possibly 50% of the observable mainstream market is now controlled by “managers” and increasing.  But even this nomenclature needs qualifying. A “manager” may just market the properties and handle bookings but pass off the actual management (linen, cleaning, call outs etc) to several third party companies or the owners themselves. They may all use different management systems and have different working practices adding further to the complexity of service provision.

Analyzing the opportunity in the scope of supply services is therefore quite difficult and not necessarily due to the incapacity of technology or lack of desire, but due to the “on the ground” logistics.

“The empty fridge dilemma” (quoted from the report)

The report shows that of those asked only 4% offer groceries pre-arrival within their PMS, 27% outside their PMS and 50% do not currently offer it.

At the base level, individual owners who self-manage locally can structure these arrangements on and offline, but this is often more a service than a significant profit line and often loved by guests especially if it has a personal touch.

However, imagine a manager with 300 properties spread over a 30 miles radius and there are major challenges: Working with local suppliers needs sophisticated data exchange systems and well managed logistics for delivery within very short time scales. Imagine 200 of the 300 properties requiring grocery packs that have different components and all delivered over a 5-6 hour period on a Saturday.

The only way to achieve this is to preplan for delivery with the cleaning teams and requires prepackaging, budgeting and forecasting. This precludes finely tailored packages. If the cleaning is subcontracted to multiple businesses then the logistics are even more complex.

Many of the problems with supplying these key services (e.g groceries) lie in the ability to provide them in less urban areas. Local shops are not set up for creation of tailored packages, they need supply forecasts and have their own business demons. Supermarkets could support this with their delivery schemes, but this needs well defined delivery times and with so much remote entry and wildly differing guest arrival times, would be rather difficult to implement.

Then there is the guest. There is a wide range of likes and dislikes: vegan, vegetarian, gluten free, packaging, brand love, quantities, pricing and more. Give somebody a choice and often they want choice plus! It could be better to buy this all before a guest’s departure and for guests to take it with them. Flights, car space etc would be problems and the perception of great service flies out the door.

Already the logistical permutations are significant and like most industries, it needs an economy of scale. 20 properties booking out at many thousands of dollars per week allows extra margins and more personal service, those managers on finer margins are challenged to reproduce such levels of service and incremental business margin.

Some companies do use supply of hampers for every guest as part of their luxury brand promotion, but their booking margins allow this luxury but its receives a warm welcome!

Hamper for holiday rentals

Many booking systems allow extras/services, so on a small scale it’s easy to automate. Provision of all these little extras goes a long way to enhancing a managers brand of course, but this is best served in the brands own name not an OTA’s even if it were possible.

Mums in particular love this sort of thing and it’s often talked about on sites such as MumsNet.

Losing the local experience!

With over the 1m+ properties spread across the globe how easy would it be for HomeAway for example to implement tailored owner and manager services into their checkout?

On the face of it, technically easy to create lists and billable extras that can have a margin extracted on addition at checkout. As shown above however the permutations are too great, the synchronizations with hundreds of systems complex and the danger of local personal service failure could seriously damage the reputation of their business (further). This will keep the KISS process in place.

Large scale global supply structures can work of course, but not everybody wants a Domino’s pizza on arrival. The OTA’s use partnership API’s to sell insurance, car hire, flights and mainstream global services and this requires large brand businesses relationships.  This provides seamless and well proven systems, but is hardly personal and the much vaunted “live like a local” experience becomes Starbucks delivered by Amazon. Big brands, “blandness and sameness” and hardly what the industry has been shouting about for the last 5 years!

Airbnb moved to selling personally organised tours which is dependent on third parties in each destination, but is scheduled after arrival and not an immediate concern upon entering the holiday home. The same could work for chains of spas or gyms of course but moving to mainstream VR groceries and personal detail, unless managed by a solid company that takes responsibility for the delivery and support is a non-starter, globally, right now.

The problem is not necessarily technology, its logistics and choice. The ideal solution is to deliver goods when a guest has arrived and is available to receive them and also bill them as they make these choices. Supermarkets already do this, but not as part of a cohesive international or even national structure with third parties and have wide ranging delivery slots.

Companies like Ocado in the UK could be a solution but they do not deliver everywhere and would need to schedule accurately close to guest arrival or with access to properties prior to arrival.

It seems some things are easy and could see global implementation providing they are supported by large commercial organisations but those with too many parameters, too much personalisation and truly local supply are a stretch too far right now.

The question on PMS systems is akin to complex pricing. It is needed within systems for those that go the extra mile, but for distribution to channels the permutations and supporting organisation is too complex and risky.

An opportunity?

A wise sage once said, “Out of chaos comes order.” Perhaps the ability to personalise can elevate the direct booking opportunity over those seen on OTA’s and create new niches! Imagine…….

http://hamperwitheverystay.com/

I know just the company to run the platform!

Have  a great rental week!

Working Together

Does your business feel disrupted?

The continual disruption (Definition: “disturbance or problems which interrupt an event, activity, or process”) in the vacation rental industry has had many companies and owners alike,  seeking a new generation of marketing opportunities which fits their own business models not those enforced by marketplaces (Airbnb, HomeAway, VRBO etc) at the supposed behest of guests.

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Round the clock rentals… Are you feeling stressed? We have some ideas.

This short post questions the levels of stress encountered by hosts in recent years as vacation rentals become more mainstream and less understood by the guests.

Question: Are you getting more stressed about your rental business?

If you answered yes then you probably know the reason why. You are working harder and over a longer period of the day for the same result.

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