Year after year, the vacation rental sector becomes increasingly saturated due to the innumerable listings produced daily. Airbnb has over six million listings in over 190 countries on its own! Then there’s Booking.com, which has about 30 million listings, nearly half of which are holiday rental homes.
When these numbers are considered, it’s unsurprising that most vacation rental firms have seen a decline in occupancy rates. As a result, they’re having a more challenging time keeping up with the intense competition.
We’ve discovered that most vacation rental operators are feeling overwhelmed by the size and growing competitiveness of the short-term rental industry. As a result, our co-founder and chief technology officer, Igor Kostin, agreed to speak at the 2019 V.R.M.A. International Conference on tactics for surviving the STR market. If you missed his address, here are the five methods he discussed that everyone may begin using now.
1. Incorporate a “wow” factor
Creating a “wow” impact in the short-term rental market may be a highly successful hidden weapon. After all, who doesn’t like receiving a pleasant surprise, even if it’s a tiny one?
Everyone wants to be astonished. Therefore, go the additional mile and wow your visitors by including thoughtful features that are great for vacation rental houses. It will undoubtedly succeed, given that millennials were virtually born with cellphones in their hands and are completely immersed in modern technology.
The good news is that providing thoughtful amenities in your holiday rental does not have to be prohibitively costly. Additionally, a $60 investment might raise your sales by up to 20%! You can wow your visitors for less than $20 with color-changing L.E.D. Lamps or a door and window sensor. If you’re willing to pay a little more, consider an economical home assistant such as an Echo Dot (a voice-activated smart speaker with Alexa).
The possibilities are infinite!
2. Appeal to the younger generation
Have you considered your actual target audience? What are their whims and preferences? What are their ages? Millennials are now the primary driver of the short-term rental sector. According to several hosts and managers, the bulk of their visitors is between 24 and 35.
What’s remarkable about millennials is their willingness to spend $5,000 or more on vacation. Indeed, they would prefer to spend their money on a new adventure (they travel up to 35 days each year, much more than other age groups) than on a new automobile.
At the same time, they want affordability and anticipate receiving various services at a fair price. Their customer service expectations are high, and they expect to receive assistance immediately. Therefore, if you cannot respond to their question within a minute, they will attempt to find another, much quicker host. And they will undoubtedly find one in the oversaturated short-term rental market.
Remember that millennials seek distinctive, exciting experiences and come to your establishment to explore the neighborhood. Therefore, please do not give them the identical brochure you utilized a few years ago. Rather than that, attempt to amaze them with an out-of-the-ordinary gourmet event or craft beer sampling. Alternatively, how about providing them with a coupon provided by a local sharing firm that allows them to hire a bicycle or a car?
3. Make an impression on the leading short-term rental platforms
The short-term rental market is not the only one that is getting overcrowded. Competition is becoming more severe across all company areas! Smaller e-commerce websites, for example, are shutting down. They cannot compete with Amazon, which controls about 40% of all U.S. e-commerce sales.
Consequently, vacation rental owners say that attracting direct reservations is becoming more complex, with the sharing economy playing a significant role. Today, more than 90% of bookings are made via vacation rental sites such as Airbnb, HomeAway, and Booking.com.
The truth is consumers place a higher premium on large platforms than on individual websites. Additionally, with Google’s algorithms continuously changing and advertising prices rising, your vacation rental website will likely be buried in a sea of comparable vacation rental listings. Individual vacation rental websites have little hope of competing with industry giants such as Airbnb and Booking.com, the latter of which spent $2 billion on advertising in 2018.
On the other side, Airbnb has established itself as the market leader in the short-term renting business, with a market share of up to 85 percent in certain North American cities. Additionally, by the end of 2018, Airbnb listings had produced over 400 million visitor arrivals.
Thus, concentrating your efforts on improving your search score on Airbnb and other holiday rental services is much more successful. By using some of the following tactics, you may boost the likelihood that your Airbnb listing(s) will appear on the first page of Airbnb:
Once you’ve accumulated a sufficient number of good ratings, Airbnb will prioritize your listings at the top of the search results.
Maintain a rapid reaction rate. Ideally, it would be best to answer within a minute after receiving a message using a native messaging system (and not email).
Change the headline of your listing periodically. Noticeably, consider changing the headline every week. Although it may seem self-evident, consumers continue to click on titles that include the phrases “Promo,” “Free,” and “Special Offer.”
Utilize a tool tailored to the short-term rental industry to adjust your price significantly every 15 minutes.
Aspire to become a Superhost. Additionally, you may consider listing your home on Airbnb Plus or Airbnb Select to boost the visibility of your listing.
4. Utilize marketing to outperform your competition
As many as 94% of vacation rental property owners admit that they could do more to advertise their homes. While vacation rental platforms continue to be incredibly effective, it is critical to go beyond them to attract additional interest in your home listings.
However, how can you locate your prospective guests? Concentrate your efforts and financial resources on the platforms where your target audience is most engaged. Considering that 52% of travelers seek recommendations on social media when booking a trip and that 42% of Facebook postings are about travel tales, the answer is obvious. Therefore, begin by focusing on social media! While short-term rental properties can be an attractive way to generate income, investors frequently face a dilemma when it comes to handling insurance issues. there are insurance policies specifically designed to cover the risks of short-term rental properties.
Embrace innovation. Begin using new methods and technology now, as they are reshaping the future of the vacation rental business and the short-term rental market. Utilize cutting-edge vacation rental software like Lodgable to make managing and marketing your business easier.
Facebook continues to be the most extensively used social media network. It has 2.4 billion monthly active users, YouTube at 1.9 million, and Instagram at 1 billion. To assist you in achieving success on Facebook, here are three essential tips:
Manage your Facebook reviews tab carefully since people prefer to believe these testimonials. Additionally, this is your opportunity to demonstrate to prospective guests that you are a skilled host in the short-term rental market.
YouTube
If you want to utilize YouTube to promote your short-term rentals, you must establish your channel. The next stage is to develop a sufficient amount of high-quality content to connect with your target audience. You might, for instance:
Upload videos highlighting the best five locations to visit in your region or the top seven local things to try.
Create “how-to” videos that provide essential travel suggestions.
Exhibit your property (at the end of the day, the purpose of your channel is to tell the world about your unique property).
Additionally, Instagram might be your greatest friend when reaching millennials. Indeed, almost one-third of millennials in the United States use Instagram every day. Along with frequent publishing and story creation, seek out influencers knowledgeable about the short-term rental sector. Influencer marketing has an 11-fold return on investment compared to other kinds of digital marketing. The good news is that micro-influencers with 1,000–10,000 followers consistently give the highest outcomes at the lowest cost.
Conclusion
The fact is that mediocrity has no place in the short-term rental sector. At the end of the day, if you want to flourish in the short-term rental market, you’ll need to figure out how to grow your reservations while also building a first-rate organization.