With current lockdowns and travel restrictions bringing short-term rental cancellations in excess of bookings across the world, property managers are searching for other strategies to adopt. So, how can vacation rental operations pivot to mitigate these losses?
One challenge that the industry is currently facing is the limitations on international travel. With Airbnb selling 91 million room nights during the first three months of 2019 alone, there’s a lot of traffic under threat. And yet, the proportion of domestic guests in short term rentals was already increasing year on year, with 2019 reaching a dominant 75%.
Below we illustrate the huge part that domestic travel plays in the vacation rental industry – for life, not just for travel crises! We’ll also outline the changes we’ve seen through the first quarter of 2020, and discuss some solutions that exist to help short term rental property managers to adapt their strategy and capture the existing demand. Next, take a look at Guesty’s guest post on our blog on how to prepare for an uptick in domestic travel.
The map above demonstrates the dominance of domestic travel in key STR markets such as the US and France. Furthermore, the trend is gathering momentum: 70% of Britons plan on taking a staycation in the UK in 2020 and on the other side of the pond, U.S. domestic travel increased 1.7% in 2019 to a total of 2.3 billion person-trips.
So, domestic guests are an increasingly significant segment for short term rentals, but they stand to be even more crucial during this dearth of international travel owing to coronavirus related restrictions.
In fact, while the first quarter of 2020 predictably lost some traction on its typical year on year growth – international STR stays fell 12% with China plummeting by 76% – domestic stays remained positive, growing 3%.
So who is best placed to capitalise on this key client?
Our pie charts show which of our most abundant STR countries are best positioned to maintain reservation levels under these new conditions. The US and Brazil source a majority of guests domestically, whereas Italy and Spain, two of Europe’s major VR supply nations, generally reach further from home.
So what does all this mean for you? How do property managers capitalise?
Optimize your distribution for domestic guests
There are myriad channels to choose from when it comes to listing your properties, and each one will draw a slightly different demographic to your market. Make sure to understand each of these offerings within the context of your area to advertise to a strong contingent of domestic guests.
Optimize your listings for domestic guests
Once you understand the type of guest travelling domestically to use your property, you can tailor your listing to attract them. Maybe it’s a professional who wants a dedicated work area & fast wifi, or maybe it’s a ‘staycationer’ looking for homely comforts like soft-furnishings, board games or Netflix. Be sure to highlight these features in your listings; ‘home away from home’, ‘beautiful bike trails’ and so on. Pictures are critical.
Other adjustments for the current climate
Not only are millennials the most likely group to spend on trips, but they are also the least at risk from coronavirus and boast the highest proportion of remote workers. Make your listing more appealing to them with trendy finishing touches and provisions, plus those all-important social-media worthy photos!
Ensure that you fine-tune and emphasize the efforts you are making to reduce contact and risk – think about your cleaning and check in procedures.
Finally, be more relaxed about your cancellation policy – peoples’ movements are more restricted, so be careful to make your cancellation policies less so to secure those all important bookings.
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