21 Replies Latest reply: Mar 1, 2019 3:03 PM by hmmmm RSS

    I have a new theory ------

    georgygirl1955 Senior Contributor

      First, I want to be clear that my properties are still being booked, although I am aware that other owners are not seeing the same results as in years past.

      I am lucky, because my properties are situated in a location that is currently "in high demand" but our area and rental market blossomed late, so I have less competition and I was one of the early ones to rent.

      So I have a good solid history and track record of reviews.

      But ---

      I have listened to other owners and PM complain,  and I have heard about the drop offs in reservations, and I understand that it is possible that I too will see a drop  in bookings ( believe it or not I am still on a metallic subscription...I may be one of the last to come off and this has probably also kept me propped up over the last 2 years ).

      So ... in fear of the future, I have spent the last 2 years wondering....where have all guests gone?

      Here is what I have decided....what do you think?

      I believe that once the decision was made by the "powers that be" to turn HomeAway / VRBO into a "Booking Site" ..... everything shifted.

      The entire site concept now is to move a looker into a buyer as quickly as possible, and to place only the "best match" properties in front of the looker.

      In doing so, the site has eliminated the very reason that the public signed onto VRBO.

      In the past, I believe, they came on to VRBO to dream...to fantasize.....to browse .....maybe to reserve....but to enjoy the hunt and come back again.

      This is how I approach all my shopping.

      I BROWSE. I enjoy the process of buying. I compare. I love coming back until I score the perfect item.

      I want to feel welcomed as I  peek around, I want to take my time, and I even like to touch and consider purchases out of my price range, that I would never buy.

      I believe that HomeAway/ VRBO has methodically driven the browser, the shopper, the dreamer, and thus the future buyer,  away.

      The rental site is no longer friendly to a slow browse....it is more like a Foreign flea market....where the buyer is grabbed, hustled, stalked, and hounded.

      If you aren't ready to buy at a foreign market ( think Mexico, Isreal, Turkey, etc ) then it is NO Fun to be there....it is incredibly aggressive and the shopper has every reason and desire to run away....to get away as fast as possible. No fun unless you want to negotiate and buy.

      How much fun it is really to buy a new car?  Most of us approach a car purchase with total dread.

      I think that due to "Best Match" and Book Now, and the new methodology,..... a lot of our property browsers are Gone - gone elsewhere so they can happily dream without being hammered into a final decision or commitment. Gone because the fun is gone. And without the browsers, the future purchaser dwindles away....the lack of dreaming lookers becomes a spiral down.

      What are your thoughts?  Where have the bookings gone?

      Are we losing the future?

        • Re: I have a new theory ------
          kiawahbill Contributor

          Great post, you nailed it!

          • Re: I have a new theory ------
            bobbie32 Premier Contributor

            I am going to take a stab at this.  I am on the local tourism board for our area.  Tourism is down thus far this year.  WHY?…we have no idea and it is probably too soon to tell.  But since a national park is the draw for our area, that just might be the reason. I was speaking to a hotelier recently and he indicated that he does well when the economy is down.  So since the economy is up, people have more money to spend on accommodations and go to more exotic places.  National Parks are a draw when the economy is suffering, since it is relatively inexpensive to stay nearby at one of several motels.  Camping is also an option, and camping does not cost a lot of money.  So it is my opinion that your location / region has a lot of do with rentals getting booked right now. I think this is the reason that hotels are fighting the notion of rentals since the costs can be spit amongst several guests and they can cook their own food as well.  I also think that because of the current economy, the more expensive the place, the more likely it will book up IMHO.   

             

            I understand what you are saying about leisurely browsing to find your dream home or one that fits your needs.  That is certainly what my husband and I do and we never put in dates.  We make the time if we find a home that jumps out at us.  Home first, dates second.  This is not the way HA intended the site to be used when they went from an advertising site to a booking site.  I will scroll and scroll until I find the home I want to rent.  And if I don’t find one, I move onto the next site be it a local tourism site or AirBnB, etc.  I prefer local tourism sites since I can find direct contact info so I can freely ask questions and save some bucks as well.  And of course if I can save some money I will.

             

            We are getting out of the rental business, so we booked what we needed this year and are happy about that. We will see what next year will bring, but we are hoping to sell the ranch if we can find a buyer.  Keeping fingers crossed...   

             

            Edited...

            • Re: I have a new theory ------
              sage Senior Contributor

              In the past, I believe, they came on to VRBO to dream...to fantasize.....to browse .....maybe to reserve....but to enjoy the hunt and come back again.

              This is how I approach all my shopping.

              I BROWSE. I enjoy the process of buying. I compare. I love coming back until I score the perfect item.

              I want to feel welcomed as I  peek around, I want to take my time, and I even like to touch and consider purchases out of my price range, that I would never buy.

              What excellent insights. If one digs through my posts of five or so years ago one might find my observations about the inquiries I was then receiving. I thought they could be broken into three groups of approximately equal numbers.

              • There were the Hawaii veterans who knew the lay of the land, had seen in my listing what they wanted, and were ready to book.
              • There were those who were in the early stages of gathering information for a possible trip, but were probably months away from serious planning.
              • And there were the dreamers who never were going to make it to Hawaii, but a little fantasy of tropical beaches would brighten their lives.

               

              I was always happy to respond to everyone's questions, even when it was obvious that I was not going to make money from them. A large part of the reason I got into the VR business was for the opportunity to communicate with a lot of nice people in distant locations. That interaction by itself was rewarding to me. With increasing barriers to human interaction the value of listing on VRBO diminished for me.

               

              You are right about adventure giving pleasure to shopping. Part of Costco's success has come from making each trip a new experience as inventory changes and warehouses are reorganized -- one may have to search to find a favorite item, and that item may not be found at all, but in the search one might find something entirely unexpected and delightful.

                • Re: I have a new theory ------
                  hill5185 CommunityAmbassador

                  Perhaps the situation is market specific? A recent booking indicatwd the traveler viewed 27 properties in barrying locations ocean, mountain and HI prior to selecting our property. Id say the traveler spent a fair amount of time making the decision.

                   

                  "Win /Loss”’cards present some interesting insights into traveler behavior.

                • Re: I have a new theory ------
                  hawaiiparadise Contributor

                  georgygirl1955, very interesting observation.

                   

                  In our case we note inquiries have gone way, way down.   We used to get lots, maybe an average of 5:1 inquiries-to-bookings.   People generally were asking for help and information to plan their ideal holiday.   Have those kind of questions gone away?   Seems highly unlikely.   I would guess travelers are instead getting their info elsewhere.  Then, when they are ready to decide/buy, that relationship is established, they are engaged with the source and whatever platform, and THAT'S where the booking occurs.

                   

                  As a side note, our business isn't off.   Our business with HA/VRBO is.

                    • Re: I have a new theory ------
                      georgygirl1955 Senior Contributor

                      But where have the HA/VRBO customers gone?  How and why did so many owners and PM all start saying it was falling off a cliff?

                      I know one reason is the massive growth of the main competitor......but I just don't think that is the full answer.

                      I have been pondering this for years.

                      How did it fall off the cliff so swiftly?

                        • Re: I have a new theory ------
                          feibus CommunityAmbassador

                          We are not all one market.  For people to generalize that bookings are up or down based on their location is never going to hold up.  Some markets will do well on the HA platform, others will do better on ABB or other booking platforms.  When we had a down year a few years back, it was tied to South Americans not coming to our specific market that year for some reason.  The next year, they came back.  But that was my market and not, say, Hawaii or Spain.

                            • Re: I have a new theory ------
                              ohst8er Senior Contributor

                              I do feel bad for any market that is suffering.  Ours is not.  We’ve increased our bookings AND ADR each year, despite the changes on the platform.  I did list our condo on Air Bnb for a few months in the winter, based on some advice from another owner but all I’ve gotten is ONE tire kicker in 3 months.  So far it was a colossal waste of effort. 

                                • Re: I have a new theory ------
                                  feibus CommunityAmbassador

                                  Absolutely!  Some markets are struggling, others are not.  Location has a lot to do with it, as does inventory vs traveler counts, as does whether the platform's google search terms are optimized for that market.  It could be one thing that's wrong or a combination of things.  There's no telling without a deep dive into the details of a particular market.

                                   

                                  But to point fingers at one platform for why a market is struggling... life is rarely going to give a simple answer to a complex problem.

                          • Re: I have a new theory ------
                            mike-dfv Senior Contributor

                            georgygirl1955 wrote:

                             

                            I believe that once the decision was made by the "powers that be" to turn HomeAway / VRBO into a "Booking Site" ..... everything shifted.

                             

                            Except for their claim that they are not a party to the transaction, which, of course, they are.

                            • Re: I have a new theory ------
                              floridarob Active Contributor

                              I think the answer lies somewhere else...

                               

                              In my opinion, vacation rentals have become more 'main stream' and have become simply much more common, and the sheer number of them has increased dramatically. Bookings fell off the cliff because travellers suddenly had so many more to choose from, and older VR's which weren't renewing themselves couldn't compete with all of the new competition joining the ranks. There are also other factors.

                               

                              In Central Florida, years ago before the great 2008 real estate crash, there were approximately 25,000 vacation rentals. Then the crash happened and when people got into trouble the vacation rental that was costing folks money every month to own (rates were below costs) was the first thing that had to go. Some have estimated the total number to have dropped by 20%, to roughly 20,000.

                               

                              How have things changed in the ten years since? As of this morning, HomeAway says that they have 39,182 listings in the Central Florida area. Owners have watched the total number on their Metrics page continue to jump over the last year, from roughly 30,000 only a year ago. Is that number of nearly 40,000 vacation rentals accurate? I doubt it, but it certainly does indicate that there are a number of things going on.

                               

                              Within a half mile of my VR, there is one particular property that is listed on the site 11 times. ELEVEN times. This is NOT against HomeAway policy. If an owner or PM wants to pay for the listings, they can list the same property as many times as they want. What kind of a browsing or shopping experience does it create for guests to see the same property over and over again in search results, along with others that are listed two or three times? In my opinion it turns them off, and it takes away from the 'shopping' experience, which could certainly lead to a drop in people simply browsing on the site.

                               

                              Of course, this leaves one wondering just exactly how accurate the number of individual PROPERTIES is on the site vs the number of LISTINGS. I thought I saw a claim that HA now has 2 million properties collectively on their sites. That number sure jumped from 1 million just a short time ago. How many are duplicates, triplicates, and so on? I really have no idea, but I bet it is substantial, just based on what I've seen happening in my own neck of the woods.

                               

                              There is a vacation rental property that is located three houses over from one of mine, and it is listed as having Basketball Courts and a Gym, and being within a Gated Community.  Well, guess what... our community is NOT gated, and their are no community facilities, such as Basketball Courts or a Gym. These features are listed in the property HEADLINE, not just the description, and they stick out like a sore thumb. It is a bold-faced lie.  And to top it off, there are three copies of this lying listing on HA sites. A year ago, I contacted HomeAway and explained to them that this particular listing was in error (which is against the site Terms and Conditions; no misleading listings) and ask that it be corrected because if guests search my neighbourhood and see this is the search results it would make sense for them to assume that this is a feature that ALL properties in the neighbourhood share, meaning that my properties must have these features too. And the response? Nothing.  The listingS stayed the same. So I contacted HomeAway again six months ago, and explained that these listings were misleading ALL guests searching in the area and needed to be corrected, and I again waited patiently to see if the problem would be corrected. And again, nothing happened. So, I took the bold step (I have no problem doing such things) and contacted the property management company that had listed the properties directly by telephone to inform them that the listings were in error and ask that they be corrected? I told them that I had guests looking for a second property in the area and that they were confused by the false information, so could they please correct it, as I was sure they didn't want to be disappointing guests. The person in charge whom I spoke with at the MC didn't seem very impressed by my calling, but assured me she would have the person responsible take a look into the matter and correct it if necessary. That was four months ago, and nothing has changed. My point for sharing the story is that HA clearly is only paying lip service to the need for integrity in listings on the site, and they would sooner knowingly have false listings on the site than take action against a large Property Management company to get them to clean up their act. So... I ask you: What kind of a browsing experience does it create for 'shoppers' when they listings can't be trusted to be accurate? I think that inaccurate information would certainly drive browsers away, wouldn't you?

                               

                              Let's get back to my point about vacation rentals becoming mainstream. The success of AirBnB, and the resulting fawning of the media over it with puff pieces that really don't delve into the destruction they are bringing to the industry, has made the idea of 'alternative accommodation' a common thing. Along with this increased public consciousness comes the increased number of people buying vacation rental properties as 'investments'. In fact, there are 'get rich quick gurus' teaching people how to lease long-term rental properties ten at a time, and then turn around and sub-let them as short term rentals properties. "How I make a Million dollars a year on AirBnB" the headlines shout. And then we get fluff TV shows about buying and renovating homes turning their attention to Vacation Rentals as an 'investment' (they're nothing of the sort, they are an accommodations business) and more and more people are jumping on the vacation rental bandwagon with dreams of success. And what do the major listing sites do? Sponsor the programs and promote them as much as they can!

                               

                              Why do they do this? Look at it from the listing site's point of view. Their 'inventory' costs them nothing. The more 'suppliers' they have the better. It provides them with more variety, more selection, more competition on the site, and lots of alternatives in case one steps out of line. (You included your own website in your listing? NEXT!) There is really very little cost to the listing site to have additional properties on their sites, and if more and more people are getting into the vacation rental biz only to have their dreams and family finances ruined, why should the listing site care? It's not their problem!

                               

                              If there are ten guests booking on the site, and ten homes available, the owners are all happy. The site processes ten bookings, and makes their cut on all of them. If there are ten guests on the site and twenty homes available, only one or two owners are going to be happy and the rest are all going to be getting half as many, or NO bookings. What difference does it make to the site? Practically none... in either case, there were still ten bookings, so they made the same amount of money. And if their traffic happens to grow a little bit, the 11th guest has seven or eight properties to choose from and it just becomes more revenue for them.

                               

                              The site has NO responsibility to ensuring the success of the owners. In fact, the site can set the owners all against each other, competing with each other to out-do their competition in a bid to win the comparatively smaller number of guests available and call it 'Ranking Metrics' and 'MarketPlace Feed' and claim it is only trying to be helpful to owners by doing so. But there is absolutely ZERO focus on the profitability or long term success of the owners. Is this how a 'partner' acts? A partner focuses on your success as well as their own, because the partnership means that when you succeed, they succeed. But that isn't the case here. All of the recently added competitive nature of the site for owners could be taken away, and the experience for travellers would change very little.

                               

                              The listing site calls itself a marketplace, a vacation rental store if you will, and the more inventory and selection they have, the better. The long-term success and health of those suppliers is simply not their concern.

                               

                              So have bookings 'dropped off a cliff'? Of course they have!! The owners are all competing against each other, along with new owners believing all the hype and getting into the business at a rapid pace, spurned on by media churn that is grossly inaccurate but which the listing sites do nothing to refute and instead sponsor and promote.

                               

                              Have the numbers of vacation rental guests grown nearly as quickly percentage-wise as the numbers of properties? I can only point to statistics from my own area, which I am somewhat familiar with. There has been growth in the number of tourists, by about 3-5% in recent years. But according to HomeAway, the number of vacation rentals has doubled.

                               

                              Would that drive bookings on the site for each individual owner down? Of course it would! You can only steal so many people away from hotels.

                               

                              That, coupled with a significant drop in the quality of the listings, and the owners who present them, plus the sheer volume of listings leading to shopper overwhelm, can only lead to a less quality experience for guests. That's unfortunate. Because compared to the number of properties, there are simply much less guests to go around, even if their actual numbers are up. Owners face an uphill battle to succeed, and more experienced ones are dealing with competition in a way they never had to previously.

                               

                              Experienced quality owners could compete in an even playing field, because they know what it takes to succeed against their competition. But now the rules of the game have been changed, because search results get dolled out like crack cocaine samples. Everyone gets just enough to keep them hooked, but no one is really getting an enjoyable high. (That's a horrible analogy to use, I know, but it makes the point very well.)

                               

                              What does the future hold? In all things human, there are ebbs and flows. Something that was once the darling of the media will soon have heaps of scorn dumped upon it. Already I am seeing articles from financial advisors telling people to run as fast and far as they can from vacation rental ownership. Once everyone had a pet rock, it no longer made anyone cool, and the rocks all became again just rocks. No one wanted one. Instead of vacation rental owners being admired, they'll be pitied, and regarded like dot.com millionaires that all went bust. Then the pendulum will swing back and the industry will settle into something more balanced.

                               

                              Hang on for the moment. The swing still has a ways to go before it starts to fall back the other way. That means it will get worse before it gets better. The winning owners will be the same ones who were winning before things started going crazy. The numbers of properties will come down, and some balance will be restored, but that is still years away.

                               

                              That's my take on what you're seeing!

                                • Re: I have a new theory ------
                                  psphoto Active Contributor

                                  Great post!

                                  Yes....AirBnB and VRBO/HA win in the aggregate, but at the expense of us individually.

                                  One only needs to look at the exponential growth in the STR market on sites such as Airdna.co or other big data sites to see current trends in the marketplace. We are becoming victims of this success. What does this mean for the future? Downward pricing pressure, less personalized service and continued regulation and restriction by local and state agencies. We will have to see when a state of equilibrium is reached, ultimately.

                                   

                                  As for actual listings, the thing to remember as I have said in the past is that any issues that really don't affect revenue generation ( such as multiple or intentionally inaccurate listings ) for the booking sites get ignored for the large part. I have complained in my area about listings that claim to be "oceanfront" that obviously aren't....and nothing was done. But they're sure quick to take down a property that tries to book offline!

                                  It's stupid of the sites to ignore these things, because it ultimately devalues the user experience long term....considering their entire business model is built on trust!

                                   

                                  I would differ though with those who claim it's hard to just browse VRBO/HA......sure, there's pressure to book, but I haven't noticed a problem with just "window shopping" the site if one so chooses. I guess it depends how "web savvy" a particular person is.....

                                • Re: I have a new theory ------
                                  jevans6149 New Member

                                  Yes, this time last year (2018) I was booked solid a month or 2 in advance with at least 1-4 inquiries a week.

                                  Now I'm going into March with only 1 booking for the rest of the year.

                                  I've only had 1 other booking since January.

                                  This is very bizarre to say the least.

                                  I've got a FB page, IG page and I promote my rental.

                                  It's really a shame cause I thought this was going to be fun, but now I'm considering going elsewhere.

                                   

                                  Any thoughts or ideas would be helpful?

                                  • Re: I have a new theory ------
                                    u0999 Premier Contributor

                                    as a consumer, I agree with foreign "flea market" analogy. reminds me walking through some market in Istanbul in the early 90s. everyone is grabbing you by the  arm and trying to lure you into their hole in the wall store

                                     

                                    I like the sites where I can come, see al the information, see options before I am prodded to' now, now, buy now.. or else". This is so much like used car salesmanship. all these sites talk about "vacation experience" but the start of that experience for future guests is less than pleasant if they are constantly nagged and prodded.

                                    • Re: I have a new theory ------
                                      hmmmm Senior Contributor

                                      100% agree and AirBnB Started the mess

                                      • Re: I have a new theory ------
                                        dinamight Contributor

                                        All very good points. I think there is room for a new website where you pay to list but customers will know that the listings are truthful and the houses are excellent. You could deal with the owners directly and avoid Yapstone-like situations.

                                         

                                        But if such a site did exist and it was successful, Expedia would probably buy it and change it.