Are Vacation Rentals the Hottest Growth Area in Online Travel?

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Are Vacation Rentals the Hottest Growth Area in Online Travel?

Renting a vacation home from a private party has been an option for many decades. But, today with the rapid expansion of the Internet and online marketing, the vacation rental market is one of the hottest growing sectors in travel and tourism.

Previously hampered by the highly fragmented industry, a lack of brand awareness and misconceptions ranging from pricing to security, vacation rentals are now becoming a considerable force in the online travel arena. Some experts say that the total spent on vacation rentals is equal to that of the cruise industry, but nobody really knows for sure because at least half the properties are owned and marketed by individuals and families, leaving no central source of data. What is certain, however, is that many of these owners are potentially prime customers for companies offering marketing and sales assistance.

"It's essentially a mom and pop industry," says Carl Shepherd, Co-Founder and Chief Strategy and Development Officer for HomeAway. But with the help of companies who’re investing in online marketing to attract potential renters, Shepherd predicts that "the vacation rental market is set to grow because it offers an unparalleled value for the average family worldwide."

HomeAway was founded just four years ago, but has already grown to become the leading vacation rental marketplace with more than 425,000 property listings worldwide. Recently ranked seventh largest travel website in terms of traffic by ComScore, the company reports 25 million visits each month across its global network of vacation rental Web sites.

Shepherd explained that Europeans are much more familiar with the concept of renting a holiday home than Americans. “For generations families had have used vacation rental homes as the backbone of their vacation planning,” he said. But, in the US, it's a different story. "The biggest misconception is that it will be more expensive than a hotel."

Unlike Europe where traditional offline companies such as James Villas, Interhome and others have been involved in the market for decades, North America was slow to notice the growth in this travel sector. So when it did start, it went straight to the World Wide Web.

"A significant factor in the growth of the industry has been the contribution of investment capital. Since our inception in February, 2005, HomeAway has received more than $405 million in private financing," Shepherd said.

"Before the growth of the Internet vacation home owners had to advertise through their real estate agents or in the classified sections of their local paper, and travelers had to start planning their vacation months in advance in order to find a suitable property," he said. "The web has changed that by offering a more efficient marketing channel for homeowners and property managers and by making vacation rentals accessible to a broader audience of travelers."

Jessica Kornacki, VP Marketing for Endless Vacation Rentals®, part of Group RCI and the Wyndham Worldwide family of companies, said her company has represented properties in Europe for more than 40 years. Since launching in North America in 2007, Endless Vacation Rentals® offers more than 200,000 vacation rental accommodations including homes, villas and resort condos in 100+ countries. Until recently, "The USA has been more regionalized and the vacation rental category has always been marketed in a more fragmented way," she said.

Kornacki explained that the benefits of Endless Vacation Rentals® include fully-managed properties, best price guarantee, technologically advanced online search and booking capabilities, more space and efficiencies than an average hotel room, complimentary concierge service and a cost-effective mix of self-catered meals and dining out. As a bonus, vacation rentals are increasingly introducing resort-like amenities, such as multiple pools and golf options.

"The vacation rental market is growing despite the economy as people are focusing more on value for the money," Kornacki said. The goal is to make it easier for the customer, she said. "Vacation rentals have not traditionally been an easily accessible category for American travelers -- it almost has an air of mystery."

The vacation rental market has high customer satisfaction levels and lots of repeat business, says Kornacki. "We are applying best practices laid out by the hospitality industry including allowing guests to use their Wyndham Rewards® points and offering a concierge service with great customer service," she said. “We also began offering short stays as an option, recognizing that consumers want the flexibility of a weekend getaway in addition to the more traditional seven-night holiday.”

Both Carl Shepherd and Jessica Kornacki will be speaking at the Travel Distribution Summit North America, being held at the Westin on Michigan Avenue in Chicago on September 16-17. They will be joined by other expert speakers including Bob Barnes, Chief Executive Officer of Zonder in a session titled: "Vacation Rentals: Can you cash in on a booming sector?"

The Summit is comprised of three senior-level conferences on Distribution, Revenue Management and Mobile Technology in Travel. These sections have been specifically co-located to provide delegates with the opportunity to meet with 700+ travel professionals. Purchasing one conference ticket gives delegates an all-access pass to the three events, providing delegates with over 30 sessions to choose from and opportunities to network with a unique cross-sector of the travel industry.

For more information, click here: http://events.eyefortravel.com/tdsusa/travel-distribution

Or contact:

Helen Raff
VP North America
+44 (0) 207 375 7582 (UK)
helen@eyefortravel.com