The Vacation Rental Manager’s Association (VRMA) made an exciting announcement today: They are sponsoring the construction of a “vacation rental switch” — a centralized location for vacation rental managers to easily distribute their inventory to online distribution channels.

A Vacation Rental Switch (VRS) could be a huge boon for the professionally managed vacation rental industry.  It will provide one low-cost and structured mechanism to quickly and easily enable online bookings at 3rd party websites.

GOOD JOB VRMA – THIS COULD SOLVE A LOT OF PROBLEMS

Currently there is much pain in the industry around distributing inventory to 3rd parties… each VRMA member is at the mercy of their Property Management Software’s (PMS) distribution system and relationships.  It will

• help the PMS companies by providing on switch to rule them all and in effect leveling the playing field.
• help the VRMs by lowering their cost and increasing their efficiency.
• help the suppliers by having only one data-feed to work with thereby creating larger scales of efficiency.
• help the industry by putting the owners of the data (the VRMs) back in the driving seat.

THE INDUSTRY ITSELF IS HUGE AND RICH

PhoCusWright’s Vacation Rental Marketplace: Poised for Change:

• Vacation rentals accounted for more than 333 million available unit nights in the U.S. market in 2007.
• Vacation rentals accounted for nearly $24.3 billion in rental revenue in 2007.
• Approximately 10% of all U.S. adults and nearly 20% of all online travelers have booked a vacation rental.
• Vacation rental consumers are a market to covet: They’re well-off, well-educated, and they travel – a lot. Nine in 10 take at least four leisure trips a year.

VRMA itself averages more than 600 property management and associate members in the United States, Canada, Mexico and the Caribbean representing approximately 150,000 vacation rentals, condos and villas.

Hundreds of millions of investor dollars have flowed into this space in recent years, whether to rental-by-owner behemoth HomeAway (which  announced a staggering $250 million placement) or B2C and B2B online players such as Escapia, LeisureLink, VacationRoost and Zonder. Vacation rental management companies across the industry have identified online distribution and investment in technology among their top strategic business priorities. Wyndham’s concerted push with its Endless Vacation Rentals brand is but one of many.

DETAILS ON THE NEW SWITCH

Many of the current pain points can be understood by reading between the lines on VRMA’s Declaration of Distribution Independence.  The Italics added by me to help readers grasp critical pain points and read between the lines:

Goals

• Create quick access and trusted experiences for consumers
• Create centralized location for vacation rental managers (VRMs) to easily select distribution channels and control inventory distribution (i.e. blackout dates, distressed inventory)
• Create a centralized location for distribution channels to access vacation rental inventory
• Provide a platform on which the industry can develop relevant merchandising and e-commerce tools such as reviews, tours, special insurance, etc… that would benefit the industry first before any 3rd party distributor
• Require that all distribution channel partners who access the inventory abide by a set of rules that protect professional mangers’ best interests and corporate integrity
• Facilitate simple, cost-effective 3rd party distribution that ultimately leads to greater volume of bookings and greater revenue per booking for the VRM industry
• A low cost to utilize the Switch for both VRMs and Distributors that will stimulate usage and ultimately facilitate significantly greater amounts of commerce
• Create a revenue stream to be used for the promotion of the VRM industry and its interests
• Create an revenue stream for any software provider who enables VRMs to simply and easily distribute through the switch by adopting its technology standard
• Create a revenue stream for distribution channels who abide by the rules of the switch enabling managers to choose which distribution partner they would like to distribute through based on that channels terms & conditions
• Provide a manual upload for property managers to distribute through the “Vacation Rental Switch” in the event their software provider does not participate
• Provide influence and control to Industry Stakeholders
• Have a Switch that is produced and managed by a credible, experienced management team with
  • knowledge of the needs of VRMs and Distributors
  • the technology expertise to deliver the solution, and
  • The financial stability and resources to fund the Solution and maintain it over a long term period

Concerns:

• The Solution should protect vacation rental managers from unfair exploitation from 3rd party distributors while enabling distribution to propagate
• The Solution must not attempt to set market rates, rather it should facilitate more competition and market rate options. The presence of the Switch will permit the free-market system to establish competitive rates, and eliminate monopolistic rate power.
• The Solution should be constructed to benefit from the lessons learned from the hotel and airline industry distribution world, and explicitly provide mechanisms to avoid allowing any 3rd party distributor from gaining so much pricing power that it could “dictate terms” to the industry
• The Solution should not create the opportunity for a “choke point” in the industry that would allow any one party to take advantage of the industry
• The Solution should not be set up so that a sale of any particular vendor or participant in the Solution could seriously jeopardize the interests and well being of the VRM industry

This will be fun to watch play out.  I expect some sour grapes and sniping from the entities that stand to lose control and revenue.  I expect many supporters who are either sick of the current status or on the outside looking in.  For sure, VRMA has taken a huge  bite and will be challenged by the difficulties of mounting a giant technology project.  I support their endeavor and hope it is wildly successful.

Check out the Request for Proposal to learn more.

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What do you think of all this??  Please comment below.

There are a few iPads floating around the Blizzard office this week and the impact is noteworthy.  It is like having a newborn in the office.  Lots of oohs and aahs and looks of envy.  I haven’t heard any cooing yet, but, nearly everyone asks if they can hold it and play with it.

We think lodging providers should consider getting an iPad (or 6) at their front desk.  While  modern labor laws frown on keeping a newborn handy at your front desk, an iPad can provide the warm and fuzzies like an infant AND improve the service levels you guests enjoy.

Use the iPad to solve these 5 guests problems:

1) What to see and where to eat:

Guests frequently want information on what to do and where to eat.  Use the iPad as your concierge.  Hopefully you already have an an online concierge (that would be your blog which features top attractions and restaurants) or a local website which you can refer people to.

2) How to get to a specific place: (more…)

Major industry news came out today with the announcement that HomeAway bought BedandBreakfast.com.  HomeAway is clearly the leader in the entire Vacation Rental (VRBO) space and BedandBreakfast.com is undoubtably the leader in the Bed and Breakfast (B&B) Space.  Each of them are bigger than their next few competitors, combined.

We had a big discussion around our office about this topic.  Was it smart?  Of course, the first question was “Wonder what they paid for it?”  Eric or Brian or Carl… please give me a call if you want to disclose that.

Before sharing my opinion, let me give a little background.

Blizzard has worked with BedandBreakfast.com for years (14?)… back when they were InnsandOuts before they were InnkeepersOnly.com, before they were BBchannel.com before they were BedandBreakfast.com… and we have enjoyed working with people there like Eric Goldreyer, Liz Hamilton, Tim Wilson and Sandra Soule… all great people.  While many innkeepers have not supported our opinion, we still recommend: “If you are a B&B, you have to be on BedandBreakfast.com.  They send oodles of traffic.  Pay them more and you get more!”  No matter what you think about them, you have to acknowledge that they rule the space and send huge amounts of qualified traffic.

Here are some of our editorials from our newsletter (our blog before it was a blog) back in 1999:

www.bbchannel.com has a special section that is available to its silver and gold members — if you are a silver or gold member, adding a special is a MUST if you want to receive the full value from Bbchannel. (June, 1999)

www.bbchannel.com (aka Innkeepersonly and Innsandouts) unveiled a new gift certificate program in April. Inns that belong to their directory (we highly recommend bbchannel.com) will have the option of honoring gift certificates sold to consumers from the bbchannel.com website. (May 1999)

www.bbchannel.com just changed their domain name to www.BedandBreakfast.com (before that they were also known as Innsandouts.com and Innkeepersonly.com) They also recently merged with World Res, the online reservation booking company. (www.worldres.com). Look for Bedandbreakfast.com to bundle their services more closely with WorldRes in the future. (July 1999)

Blizzard has recommended  HomeAway and VRBO.com for years too… not as many as BedandBreakfast.com.  Our opinion is the same though, and it also angers many of our Vacation Rental Manager clients who see HomeAway and the VRBO movement as threatening: “VRBO.com is the biggest player in the space.  Listing your homes with them will send you hundreds or thousands of leads a year.”

Many Blizzard folks were surprised by this acquisition: it is a big move for a company that specializes in the VR space to move into the B&B space. They are very different markets with very few synergies.  It is also odd because the vacation rentals space is much larger than the B&B space.  BedandBreakfast.com has 10,000 B&B listed.  Orlando or the Outer banks, alone, probably have 20,000 vacation rentals each.

But, we all believe that management at Homeway is smarter than your average bear.  Clearly becoming the market leader in another segment of the lodging industry is a solid move (assuming it didn’t cost too much).

But there is more to this story. (more…)

Exciting news came from Escapia last week when they released their Vacation Rental 2010 Annual report.

After about 18 months of bad news, it appears that the industry is looking up!  While numbers were down for 2009, they clearly were trending up during the fourth quarter.  This is partly due to the comparison to an absolutely miserable 4Q of 2008.  Nonetheless,  it looks like the market has stopped falling and is holding steady (at worse) and even improving a bit!

Here is their month-to-month comparison for 2009 VS 2008 bookings:

This report is a must-read for any student of the Vacation Rental industry.  They offer a free download with over 20 pages of data.

Thanks Escapia for making this data public!

Escapia is an industry leading provider of property management software, bookable websites, web distribution and yield management for the vacation rental management industry.  With over 300 active users, their on-demand software offerings are among the hottest in the VRM industry.

Industry Spotlight Guest Post By: Jeremiah Gall, COO and Co-Founder, FlipKey

The annual VRMA Conference taking place in Washington DC in a few weeks will mark the 2nd anniversary of FlipKey and its industry leading guest review service.   Since that time FlipKey has emerged as the industry standard for vacation rental guest reviews, represents the largest collection of authentic guest reviews in the industry and now powers vacation rentals on TripAdvisor.com – one of the largest and most influential consumer travel sites in the world.

To gauge the impact of our service and general satisfaction we recently surveyed our clients via an anonymous email survey and asked a simple question:

(more…)

Exciting news for all the FlipKey users out there: Google Local has added FlipKey as a data source for consumer reviews.  Vacation Rental Managers who use FlipKey will see an immediate boost.  A boost probably in rankings, but more importantly in traffic and bookings, as consumers are drawn to reviews like moths to flame.  At Blizzard Internet, we agree that Google Local 10-box (that shows up in organic search results)  is quite significant and represents bunches of qualified traffic each month.

Here is an example from Destin, a major Florida market.  The companies with FlipKey reviews are highlighted in yellow.

This news follows a major update back in February when we saw FlipKey’s reviews show up in Tripadvisor.  (more…)

Carrie Hill of Blizzard Internet Marketing selected to present at the West Coast’s largest search engine convention.

For the past 11 years, Silicon Valley has welcomed the world’s foremost experts in search to the Search Engines Strategies Convention. This year Blizzard Internet Marketing’s Director of Search Strategies, Carrie Hill, has been chosen to sit on an elite panel to offer tips for travel marketing in today’s economy on August 12, 2009.

Experts in this session, called Four Paths to Success in a Tough Travel Economy, will focus on 4 key areas of search marketing including: Organic, Paid, Social, and Local/Mobile.

Carrie says that this panel will “focus on how to get the most out of a limited budget or a budget that has been cut drastically.  Three years ago this never would have been a topic – I think it’s a testament to how SES is willing to roll with the times and deliver content focused on what marketers are looking for today, not three years ago.”

This is the 3rd year that Carrie Hill has been invited to join representatives from other top performing companies on a SES San Jose panel.

Travel marketers should not miss this SES session, Carrie adds that “each speaker is going to concentrate on one aspect of search, from organic to paid and social to Local and Mobile.  We’re also going to have Roger Wong from Bing Travel talk to us about how their product has been updated and refined to really serve the travel consumer.”

During the past couple of years, the economy has been a focus of the Search Engine Strategies Conference. Each session this year will present smart new strategies for moving forward in today’s market and getting the most out of a limited budget.

The 5 day convention will include over 70 sessions, hands-on workshops, highly anticipated keynotes and over 150 exhibitors.

(more…)