Find out how to save money and increase your bookings by going Direct

Vacation rentals used to function almost exclusively through Direct Bookings. Guests would make their reservation directly with the property owner or manager, having discovered them through local advertising or word of mouth. When the industry moved online around the start of the millenium, Direct Bookings by owners grew a lot because it was easier to reach more people. In the early days it functioned on a listing model – owners would pay a price per year to have their property listed on websites like HomeAway. All bookings were managed between the owner and guest, with no commission to the channel. Then Airbnb came along and changed the game by introducing a commission based model. This has been adopted by all major players in recent years, bringing with it a significant reduction in the prevalence of Direct Booking vacation rentals.

Nowadays more than half of all vacation rental bookings are made through an OTA or sales channel like Airbnb, Booking.com, HomeAway and others. Opinion is divided on whether or not that’s a good thing. Guests like the convenience and security that these platforms provide, meaning more bookings are made and the vacation rentals industry grows larger and more lucrative every year. Additionally, many property managers now find it easier to secure bookings because they can make their property easily visible to a huge marketplace of guests. This is especially true for managers using channel managers and services such as Your.Rentals who publish their property listings on dozens of different websites to maximise exposure.

But with sales channel commissions increasing all the time, and a larger percentage of bookings being charged OTA commissions, many vacation rental managers are finding that their profit margins are becoming squeezed. And with companies like Airbnb making inroads into direct property management, owners and managers are understandably hesitant to put all of their property management eggs into the proverbial sales channel basket, lest their listings suddenly fall out of favour and start slipping down the search results. Additionally, Google’s increasing interest in the vacation rentals market has certainly caught the attention of many in the business, all of whom are asking:

“What exactly does this mean for property managers today?”

The return of Direct Bookings

Whilst OTAs aren’t going anywhere anytime soon, those with one eye on the future are reconsidering the importance of Direct Bookings in their vacation rental property management strategy. Direct Bookings as the name suggests are those made directly between a guest and the owner or manager of the property. In the truest definition, there are no middlemen or services between the two parties, but essentially Direct Bookings refers to those made without the help of OTAs or sales channels.

So why are Direct Bookings worth spending your time on? Well for starters, you can immediately cut out the costs and commissions associated with sales channel bookings. This leaves a greater share of revenue for the host. In many cases this can also justify a lower price being charged to the guest, who will undoubtedly be happy to cut out the booking fees charged by sales channels (a happy guest is your most valuable sales tool! More on that in a moment).

Another factor influencing the return to prominence of Direct Bookings is that it no longer requires a great deal of tech expertise or fiddly paperwork to set up. Adding Direct Booking capabilities to your website can now be as simple as adding a couple of lines of code, and offering guests instant online payment for Direct Bookings is easily done in a matter of minutes. Services like Your.Rentals give property managers the ability to offer Direct Bookings easily so that guests can book and pay securely in a couple of clicks. These Direct Bookings can then be synced to the property calendar on sales channels so that there’s no risk of double bookings.

What do guests think about Direct Bookings?

There will always be guests who want the ease of booking their accommodation through a website they’ve used a hundred times before, so OTAs and sales channels should of course still be a valuable part of your booking strategy. But an increasing number of guests are savvier and more well-versed in the art of online bookings than ever before. They’ll shop around for a bargain, and if they can find a property cheaper elsewhere, they’ll happily forgo the familiarity of a sales channel to save a little cash.

Without sales channel commissions to consider, you can afford to bring your price down for Direct Bookings. This means that guests are more likely to book directly with you, which not only saves you money, but gives you valuable information that you can use to reach out to those guests in the future to offer repeat bookings. You can create and customise Direct Booking offers using Your.Rentals (adding personalised discounts if you choose), so if you’ve got a couple of empty nights in your calendar why not send a friendly message to your previous happy customers? You can also capitalise on word-of-mouth – instead of referring their friends to a sales channel where they made the booking they’ll be sending potential customers directly to you.

Of course, Direct Bookings are only as good as the host offering them. Guests are incredibly security conscious nowadays, especially when it comes to something as important and potentially expensive as a holiday. This means that they need to feel that they can trust that their booking will be handled securely and that there will be no issues with their payment. Your.Rentals uses extra secure measures for all bookings, and allows guests to pay by a variety of credit cards and even PayPal for extra convenience and security.

How do I get Direct Bookings?

Incorporating Direct Bookings into your property distribution strategy (alongside multiple OTAs and Sales Channels) can be a sensible move if you’re looking to increase your share of booking revenue and diversify your sources of bookings. Adding another string to your property management bow can help you maximise your booking revenue in today’s increasingly competitive vacation rentals market.

Sourcing Direct Bookings through your website, Facebook, email or even traditional offline marketing can help reduce your reliance on sales channels and lead to an increase in those all-important high-margin bookings. By using Your.Rentals to process your Direct Bookings, you’ll be able to manage your payments, calendars, listings and channels all from one central platform, so you don’t need to make a choice between a Direct Booking model and channel distribution.

If you’d like to see how easy it is to add Direct Bookings to your management strategy, sign up today for free and start offering Direct Bookings in just a few minutes!

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