Change and VRBO.com

By Tom Ogg

An agent posted a message in the Travel Professional Community regarding a newsletter that she received from Farmer’s Insurance advising their clients to use sites like VRBO.com and AirBNB.com as an alternative to more orthodox ways of planning and extended family vacation. It went on to point out that both sites have over 100-million visits annually, owners take bookings directly, pay no commissions and satisfaction is guaranteed. The agent was concerned that sites like these will change the very nature of the travel agent industry.

As it has turned out, every new technology that was projected to eliminate travel agents has actually ended up enabling them to compete even more aggressively. The web has created huge opportunities for travel professionals and I am sure that the growth of owner to consumer sites such as VRBO.com are just another opportunity waiting to be born for travel agents.

Joanie and I own a number of condominiums in Punta Mita, Mexico that we rent to surfers and fishermen. We advertise on sites like VRBO.com, HomeAway.com and Wavecation.com successfully, but we also pay travel agent commissions. Even if an agent suggested a client look at our condos and then the client books with us directly, we pay a commission to the agent. We know how important agents are to our future and see the commissions we pay as an investment in future growth.

However, this brings up an excellent chance to share how travel professionals can cash in on the owner to consumer direct condo, house and villas rental phenomenon. Here are some tips on how to exploit the opportunity.

The Need for an Unbiased Agent in the Marketplace: Each property in VRBO and other consumer direct sites is unique to their owners. As an example, our complex in Punta Mita is now 12-years old and the condos are being redone to today’s standards. We have invested tens of thousands of dollars in improvements, new appliances, air conditioning and so on to make our renters stay truly wonderful. There are some condos in VRBO in our same complex that are the original furniture package and that are completely run down.

Having knowledge of the complex and of the individual units would be worth its weight in gold to a consumer trying to book a vacation property. As an example, some of the condos for rent to the surf niche in our complex are being rented by owners that don’t even surf. One guy has an ariel shot of Jeffries Bay in South Africa claiming it is our local point break. Niche expertise is needed to protect consumers in this volatile marketplace.

Business is Business: Don’t forget that the owner of a condo, house, villa or other rental property in the vacation market wants to rent their property as a business. Sure, the consumer direct sites offer a quick way to reach potential new clients, but they leave the marketing to the owner who may not be the most sophisticated or experienced marketer in the vacation market. Their motivation is because these distribution channels have presented themselves as viable ways to rent their properties. Property owners haven’t made the decision to not work with travel professionals they just don’t have an evolved channel at their disposal to do so.

Create Your Niche: Given the above realities, it should be easy to see that there is plenty of room for an agent that specializes in a given market to offer quality and unbiased advice to consumers looking for owner direct vacation stays. Booking with the owners directly is very risky, as they will pretty much tell the client what they want to hear to get the booking. In our case, an agent would be smart to specialize in condo, home and villa rentals in the Puerto Vallarta area. An agent could then offer consumers the opportunity to discuss their plans with someone that has a balanced presentation of various properties’ value proposition. Instead of dealing with an owner who is going to say pretty much anything to get the rental, a consumer can discuss the pros and cons of properties they are considering. Of course, the agent will have solidified a working relationship with the best properties offering the most compelling value proposition.

Brand Your Niche: Let’s say you decide that you would like to offer Puerto Vallarta’s most fancy villa rentals to affluent families. There are literally hundreds of villa rentals in the Punta Mita area that you could represent. Simply Google “Punta Mita Villa Rentals” to see what comes up. “www.PuntaMitaVillaRental.com” is in the #1 slot and if you check this site out you will see that there are rentals from over $10,000.00 per night to about $400.00 per night on the low side. Each one of these is owned separately by private folks that are looking to rent them out on a nightly basis. Think about how you could brand your niche in a way that left nothing to the imagination about what you offer and would also gain SERP. Get an appropriate domain name, a focused logo and website design and start talking with owners to negotiate your commission. Understand that most management companies may charge over a 40% “management” fee for doing the same thing that you will be doing.

Market Your Niche: Building niche keyword websites for SERP is just plain easy at this point. Use content from your owners to build visually compelling pages for each property that you intend to offer clients and why they were chosen. Make a huge point that your service does not cost clients a penny, but will allow them to find just the right property for their needs. Owners are happy to commission marketers that are creating demand for their property and a revenue share model is much more acceptable to them than the advertising model that VRBO, HomeAway, Wavecation, AirBNB and all of the others that offer owner to consumer connectivity. None of these sites actively market an owner’s property and at the same time, enable other owners within a complex to compete with theirs. All an agent has to do is offer a more convincing opportunity for owners to rent their property and they will clearly become a successful distribution conduit within their niche.

Enjoy the Opportunity: Consumers find a way to get what they want and by offering them a safe and effective way to book condos, homes and villas directly with the owners, you will have helped both parties immensely. And, I might add, that by renting villas for over $10,000 a night, you should be able to make a nice income to boot. Instead of thinking sites like VRBO will hurt your business, take the time to understand why they are successful and see if there is a way for you to cash in on the evolution.