Salty News cont....
Marketing channels for vacation rentals have evolved to utilize tried and true OTA channels (Expedia, Booking.com and similar) hotels and resorts have utilized for years. OTA channels can be quite effective in providing lifts in occupancy but it does come at a price with commissions for such bookings as high as 20%. While many vacation rental companies are passing along hefty commission fees for bookings achieved via OTA channels; Panhandle Getaways deploys a strategy that does not have our owners footing the bill to achive visibility and conversion on the OTA channel sites. We at Panhandle Getaways are able to avoid passing the fees along to our owners due to our intricate knowledge of how these channels work and negotated commission structures yielding strong results to which everyone wins.
Because our marketing strategies are multifaceted and carefully monitored for KPI (key performance indicators), we are able to utilize all of the analytical data to hedge best positioning for any property within our portfolio with great success.
What's going on with VRBO & Homeaway?
As you are likely aware the platform has undergone a complete over haul over the last 6 months. Subscription listings are still the driver on this site but subscription listings are all now equal in cost with the elimination of "pay to play" subscriptions utilizing a tiered option for visibility (bye, bye platinum listings). The concentration for listings is now placed on availability & conversion and the ability of a listing to achieve conversion dictates search visibility within the VRBO/Homeaway site.
The good news in all of this is that we are no longer held hostage to high subscription rates and because Panhandle Getaways deploys a diverse marketing strategy utilizing a variety of marketing channels, VRBO/Homeaway is just not a huge factor in successfully achieving bookings for any vacation rental within our program. Additionally, we want owners to understand that while we do utilize the VRBO/Homeway channel it is NOT the primary means in which bookings are achieved for properties within our portfolio.
The bad news or should we say challenging item regarding VRBO/Homeaway is that because all subscriptions are on a level playing field, units that are more athstetically pleasing will convert at a much higher rate than those units with yellow painted walls, dark printed bedding and so on. While a rental may have a direct beachfront view within a highly sought after resort; if the decor is lacking or is too dark it will not convert as readily as those that do. It does not matter if we provide content about large tv's or granite counter tops.....guests want a bright and fresh space in which to enjoy their beach getaway.
Additionally, any time an owner reserves their unit for several months in a season; it affects the visibility within search on OTA channels because the availabile nights are reduced. This is particularlly relavent during high booking months for peak season which are January, February and March. If an owner implements an owner stay during January, February and into March; getting good visibility and traction can be difficult until the unit has a full 30 days of available dates in which to book meaning we will see these units convert at a much slower pace for peak season dates. The reason for this is that most bookings now occur within 30 days of arrival. For instance, if there is an owner stay through March 10th, the unit will not see conversion pick up until March 15th or so. We can mitigate this circumstance with pricing strategies until we can get conversions but again, it is challenging.
Overall, conversion is the key to everything..... higher conversion rates equals better search visibility within any OTA channel.
NEW OFFICE OPENING FOR PANHANDLE GETAWAYS ON 30A
We invite you to join us for the Grand Opening of our new office on 30A within "The Hub" in the new town of Prominence on 30A. This is Panhandle Getaways 2nd office location and we are excited to share this space with you. If you are in town on February 24th stop by to check it out and visit with us. If you have any questions regarding the details of the Grand Opening Celebation, contact our Panama City Beach office at 850.588.8125.
The Salty News cont....
The Salty News cont....
We might as well cover the more salty topic of the day, VRBO/Homeaway platform changes, updates and what this means for owners. Changes continue for the once go to choice for anyone looking to book a vacation rental. Let’s review a few of the changes and go over a few highlights.
Consumer Service Fee
HomeAway recently implemented a consumer service fee. The service fee is equal to 6-10% of the rental rate. It is not clear at this time how the percentage is dictated or assessed but we do know that all Panhandle Getaways properties seem to be falling in the 7-9% range. The addition of the service fee charged to our guests and retained by HomeAway/VRBO has certainly driven up the price for consumers looking to book a vacation rental on these particular websites. What does this mean for you as a homeowner? Ultimately, the service fee now imposed on consumers booking on the HomeAway & subsidiary sites inflate the rate beyond what the market typically yields. The higher price drives a lag in bookings compared to years past. This being said, consumers still want to get to the beach so, while the price has risen to the consumer searching on VRBO than in years past the overall the demand still drives the bookings especially in peak season.
An additional issue associated with the service fee recently implemented is the consumer’s confusion of two separate charges at the time of booking. Consumers have called inquiring why their credit card was charged on two occasions in association with a booking via one of the HomeAway sites which lessons consumer confidence. There is confusion among consumers as to when and how the service fee is paid. Panhandle Getaways is well versed in understanding what is going on and is able to educate the consumer but there are a few that simply get spooked.
Paid Subscription Listings
Gone are the days of paying for platinum listing and ruling the roost on vrbo.com. While a platinum listing does currently provide better visibility than a classic listing, it is only one piece of the puzzle at this point. HomeAways’ recently deployed "best match” algorithm is the determining factor in search placement along with a multitude of other factors. With Expedia’s recent acquisition of Homeaway, we have and will continue to see a move toward traditional OTA onsite search practices where availability and consumer filters drive search results for anyone looking to book a vacation rental.
Please be assured that Panhandle Getaways is abreast of the situation and well versed in OTA practices which means we are better prepared than most to manage the overall shift to OTA formats. Our experience and depth of knowledge with regard to OTA’s from a marketing perspective allows us to be more nimble as we navigate through a shift of the vacation rental industry move towards the traditional OTA channels hotels and resorts have utilized for years.
We will continue to see changes on the VRBO site, some good, some bad but one thing is for sure…gone are the days of a VRBO listing being the ONLY means to effectively obtain bookings for a vacation rental.