What Hotel Operators Can Learn From Vacation Rental Businesses

Vacation Rental

This is a guest post by Dennis Klett, Co-Founder of Lodgify.com

There has been a lot of talk around the vacation rental industry in the last couple of years. Rightly so, after it has managed to evolve into one of the fastest growing industries in the travel sector. The future of the industry looks bright – and investors seem to agree, considering the financing round that Airbnb has just closed, valuing it at more than some established hotel chains such as Hyatt. It comes to no surprise that Starwood and IHG Execs are getting worried about losing market share to these giant home-sharing companies, and a Booking.com has decided to enter the industry by launching Villas.com – a dedicated site for vacation rentals, villas and apartments. Airbnb’s success and the growth of the vacation rental industry suggests that travellers are increasingly preferring to stay at vacation rentals rather than hotels. Hoteliers need to therefore gain a deeper understanding on the success factors of the industry and learn how to differentiate from and position themselves towards vacation rentals. Here are some quick insights into some evident vacation rental success factors:


Vacation rentals aim to provide guests with nothing less than a home away from home. Most property owners invest a lot of their own time and effort in refurbishing, arranging and decorating the place, which makes their home feel more comfortable and authentic to guests. Travellers appreciate those comforts and the personalized experience that hotels sometimes lack. When choosing a vacation rental they attach great importance to the individuality of each home and base their final selection on the unique impression they receive from pictures and descriptions. Hilton will now become the first major hotel brand to allow guests to actually choose their room from a digital floor plan, giving guests more personalization options. Further, guests develop much more of a personal relationship to hosts of vacation rentals. Hosts are able to share more relevant local information on places and events in the surrounding area, and can provide credible recommendations. For guests this means less of a touristy experience and the sensation of feeling like a local.


Vacation rentals can offer guests more space and privacy. Typically, hotel rooms are 400 square feet on average, while the average vacation rental is 1,850 square feet. That makes it ideal for groups or an entire family. With the same number of guests, you would probably have to reserve multiple hotel rooms. Further, many vacation rentals provide a private garden or even a private swimming pool. Guests also enjoy many other amenities. They have their own kitchen or washing machine, some vacation rentals are pet-friendly, and free wi-fi has become a standard feature. Finally, as most vacation rentals are self-catered, there are no constant interruptions by housekeeping. Guests maintain their own space, which allows to keep their space to themselves. Yet, guests are always in touch with the host, on an as-needed basis. Hoteliers may now argue that vacation rentals do not yet compete for their core market of high-end and business travellers, however it may just be a matter of time. Airbnb has already made a move into that market through its recent deal with Concur, a provider of business travel and expense management services.

So what the above points ultimately lead to is a high number of repeat guests. Vacation rental operators have become experts in understanding how to provide an excellent guest experience. And that makes many of their guests return.

The vacation rental industry is moving swiftly. Vacation rental operators have adopted best-practices from hotel businesses and have professionalized their services towards travellers. One of the indications for this is the increasing demand in utilizing advanced property management solutions and creating an own website presence. Through new software-as-a-service solutions, such as Lodgify, this has become affordable even for small and medium-sized vacation rental businesses. It’s now come to a point where hotels, especially boutique and budget hotels, can learn certain aspects from the vacation rental industry. Considering the ever-changing expectations of travellers and guests, it may even prove to be vital for their future success.

This guest post was written by Dennis Klett, co-founder of Lodgify.com. Lodgify is a software-as-a-service solution that allows vacation rental owners and managers to easily create their own accommodation website and accept online bookings.


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