In an effort to alleviate uncertainty within the short-term rental industry, we surveyed over 500 industry professionals, property management companies, investors, and tech players across the global hospitality and travel sector to hear their predictions on the future of the space. We then hosted a virtual event with industry thought leaders to share their reactions to the travel forecast we’ve shared and contribute their own perspectives on the road to recovery.
Throughout the meetup, Guesty’s very own CEO & Co-Founder, Amiad Soto, shared the stage with Pierre Becerril, CEO & Co-Founder of Transparent; Robin Clifford, Head of Expansion at Nestor; and Travis Riner, Head of Business Development (U.S. & Canada) for Homes & Villas by Marriott International to discuss traveler habits and trends in booking patterns in 2021, and their unique experiences in pursuing success during an unprecedented period of uncertainty.
Amiad began the discussion by sharing data from Guesty’s latest report on The State of Confidence in the Short-Term Rental Ecosystem based on responses from our survey, highlighting some key insights including the predicted timing of full travel recovery, how much vaccines will play a role in that recovery, and what to expect for 2021. He also mentioned how 83.2% of our survey respondents believe short-term rental converts will keep booking alternative accommodations over traditional hotel stays once the global health crisis is behind us.
Pierre then presented data showing the impact COVID-19 has had on the industry, gathered from his company, Transparent, the leading data intelligence provider for the short-term rental sector. Although throughout the pandemic there has been an emergence in longer stays and last-minute bookings, Pierre revealed that as confidence for travel grows, these trends are starting to normalize back to pre-COVID levels. He also gave intel into how various markets are faring throughout the pandemic, and provided data on UK bookings after the recent roadmap announcement easing lockdown restrictions.
Through his experience as Head of Expansion at Nestor, the UK-based modern hotel and serviced apartment operator, Robin then provided strategies on how to successfully navigate the pandemic through implementing smart rate plans as well as initiating a direct booking model. He concluded with several ways property managers can cater their properties to new travel personas, such as digital nomads and families, through in-house entertainment, WIFI boosters, pet-friendly amenities and more.
Wrapping up, Travis discussed Marriott’s entrance into the short-term rental space with their Homes & Villas initiative, and how their Marriott Bonvoy loyalty program played a huge role in gaining bookings at this time, accounting for more than 90% of their reservations! Travis then gave an insightful presentation on the dominant trends they’ve seen over the course of the pandemic, such as the demand for drive-to destinations and premium homes, and shared what Homes & Villas has in store next when it comes to delivering guest expectations in the new normal.
As always, we rounded off the event with an interactive Q&A session featuring questions submitted by our audience. Here are some highlights (edited for clarity):
Q: How do you think hotels will further incorporate alternative accommodations into their business models?
Robin (Nestor): I see alternative accommodation as a disruptor in the travel space. It is growing very quickly and hotels realize they have to get involved as you already see big hotel brands expanding their offering to incorporate these. What they will do is elevate the level of consistency in the alternative accommodation space and use that to enter the market.
Travis (Homes & Villas by Marriott International): We entered the short-term rental business prior to COVID-19 by several months as we noticed that 30% of our Marriott Bonvoy program customers were leaving us once a year to have a vacation rental experience. So we saw that as an opportunity to capture that demand that was leaving us for other platforms.
Q: What do you think is an ideal pricing strategy to implement as travel normalizes?
Pierre (Transparent): One key strategy to implement is to adjust pricing on demand and pacing. Instead of having a very rigid strategy based on seasonality, make it very reactive to the actual demand you see which would help optimize it. If you’re seeing high occupancy and a lot of reservations come in for your rentals, this should give you confidence that you should maintain your rates as is.
Q: What is your stance on whether or not property management companies will continue to provide flexible cancellation policies once COVID-19 is behind us?
Robin (Nestor): For us at Nestor, having a non-refundable rate has driven conversion and worked for us. Although there has been an uptick in cancellations, because the rebooking window has shortened so much, we’ve managed to refill those bookings anyway. In the future, I believe flexible cancellation policies will remain so it’s important to have your rates priced accordingly. You should have both refundable and non-refundable rates when it comes to your properties.
Pierre (Transparent): It has to be a data-driven decision. I would say look at the benchmark and what is happening in your local market to base your rates. If everyone is flexible, and you’re not, you’re probably missing out.
Travis (Homes & Villas by Marriott International): I think flexible cancellation policies are here to stay and giving your guests the range of choice is gonna be crucial moving forward. We had a 10 day flexible cancellation policy for 10 months now and we will still have it going into the summer.