Short Stay Summit: Category blur is giving rise to the era of 'flex-rentals'

Short Stay Summit: Category blur is giving rise to the era of 'flex-rentals'

Expedia's James Cassidy told delegates at the Short Stay Summit in London last week that the OTA's new unified tech platform and loyalty programme will support property owners and managers to achieve profitable and sustainable success in the growing holiday rentals sector

Post-pandemic category blur in the hospitality sector is providing opportunities for alternative accommodation to come even more into the mainstream.

James Cassidy, Expedia Group EMEA senior director for partner success in vacation rentals, told last week’s Short Stay Summit there is a renewed focus on supporting property owners.

He said emerging traveller behaviours have seen the emergence of a “flex-rentals” model that is bringing the real estate and travel sectors closer together.

“This is an interesting approach to how you take a property and have it permanently rented but also available for short-term rental in a structured and organised way,” Cassidy said.

“You can enjoy the yields of a vacation rental for certain months of the year but also have it permanently rented for the rest of the year.”

He added: “It’s category blur. The asset is an asset and you make your yield from your asset. But at the end of the day the traveller is the most important person in all this.

“Their perspective is I have exclusive use of this property for this period of time and it’s like home in a unique location.

“Although there is category blur, if we continue to balance supply and demand effectively, and most importantly deliver on traveller needs, we will be successful.”

Cassidy said Expedia’s VRBO holiday rentals brand will start to see the benefits of a more coordinated group-wide strategy from this year.

Expedia has announced plans to put all of its brands on a single technology platform and to create a unified loyalty programme across its brands called One Key.

“Expedia wants to put the traveller experience at the heart of everything we do as a company,” Cassidy said.

He said the single platform will allow owners to manage their properties more effectively with Expedia accessing promotions, packaging capabilities and member-only deals.

The integration will also allow VRBO, formerly HomeAway, to transact in many more currencies. Currently it is limited to just six while Expedia handles 126.

And a new tech platform called Open World, unveiled recently at Expedia’s partner conference in Las Vegas, will provide a wider range of services to new and existing partners.

Cassidy said this approach will open up travel, allowing a surf shop owner to get into booking holidays for his clients by tapping into local property supply.

“VRBO is migrating currently to the Expedia platform and you will start to see some Expedia traveller packages on the VRBO platform by the end of this year.

“The promise of convergence has been there ever since they [Expedia] acquired HomeAway all those years ago.”

Cassidy said the power of the OTAs is that they bring new travellers into the sector. Today 50% of VRBO customers are new to the brand.

“We have driven growth in this sector for many years. That’s a real value add for property managers. In the last two years of growth we have brought in new types of customers.

“What have they been booking previously? Hotels, so they bring expectations of the hotel booking experience with them. 

“What do you mean I have to pay a deposit, or I have to sign a contract, or physically go to a shop to collect a key?  

“Their expectations are set, so the opportunity for the property managers is to meet those expectations better than the competition.”

Another opportunity for property managers is linked to sustainability, said Cassidy. “Ninety percent of travellers are searching for sustainable travel options.

“Fifty six percent say they are prepared to pay a higher fee to make their trips sustainable. The opportunity is how do we make your property sustainable.”

Cassidy said VRBO and Expedia will set standards in carbon and energy efficiency ratings or offer travellers the opportunity to make an optional donation to an environmental cause.

“We could start that flow of funds on a small scale and that will start you on your path to be sustainable. If could differentiate you against your competition.”

He added: “I see the relationship as a two-way relationship not one way. We need to take advice from our customers, from our property owners and managers and act on it.

“The best thing we do is build those relationships with our property managers. That’s trust that is built year after year by listening to their feedback and taking their advice.

“It is involving them early in the product development cycle and making sure we have built products that help their businesses grow.

“We are a full service travel company OTA. We have vacation rentals, we have hotels and other types of accommodation, we have flights, car hire, we have activities.

“We have a suite of brands but also an extensive affiliate network. Our demand network will only grow with Open World.

“I think it’s going to be a record year. Summer is looking great and winter is looking great as well.

“You need to match your supply to the demand in the marketplace as effectively as you can. Use data, use AI, use tech as much as possible. 

“Do it sustainably, do it profitably and work with the industry for the betterment of your customers and yourself and you’ll have as long and as successful time in vacation rentals as I have.”