If you're like most successful vacation rental hosts, you're probably very responsive to guest feedback.

Guests complain about a loud air-conditioning unit in the master bathroom?

You either fix it or get a new one.

Hear enough guests say the towels are kinda cheap?

You go buy nicer towels.

We do this because as owners and managers we take great pride in creating spectacular guest experiences and we see constructive criticism as an opportunity to grow. We do it for survival too: receive a few too many of these complaints and our business begins to suffer.

This being said, it's always a bit confusing to me why the major listing sites in our industry -- the supposed vehicles of our values -- don't adopt that same style of responsiveness and adaptability when it comes to criticism and critique. It should be no surprise that an emerging industry will be pockmarked with growing pains and learning curves...

But the sheer anger that one picks up from most user feedback about these sites is strangely palpable. If you were to put it in vacation terms, it's as if the host isn't listening to their guests complaints, yet the guests kinda have nowhere else to stay.

It's been this way for years.

Airbnb Has Never Really Focused On Vacation Rentals

Last week, I received a call from Shaun Stewart, Airbnb's Global Head of Vacation Rentals.

Noticing the great potential of our emerging industry, Airbnb hired Shaun about 1 year ago to head a department catering exclusively to us: the vacation rental owners and managers.

Shaun explained how (1) vacation rentals are inherently different from traditional Airbnb properties (less urban and more vacation destination-based, for instance). And how (2) our differences simultaneously present a great compliment to Airbnb's existing brand portfolio.

This may be pretty obvious to a lot of people.

But what I found remarkable and shareworthy was the style with which Shaun and his team went about entering the vacation rental market. I say style because it's more than just a process or a sequence of actions. It's this conscious way of thought that sets one apart from others. And upon revealing that he would be willing to let me share this previously-unpublished information, I began taking copious notes!

The 3 Steps Airbnb Is Using To Enter The Vacation Rental Industry

I could envision a large company like Airbnb seeing an opportunity with vacation rentals, stabbing at the industry blindly, and succeeding perfectly well in the short-run. But as you may have guessed, Shaun's team at Airbnb was a bit more thoughtful than that.

Upon hearing the way they were going about this process, I humbly asked if I could share the steps with the world and Shaun and his team agreed to lend me the exclusive, which is to say, the following is "hot off the press":

Step 1: Listen

Airbnb was savvy enough to realize that vacation rental owners/managers are unique. And while Airbnb is the world's hottest hospitality brand, the company wasn't versed in the nuances of vacation rentals (compared to their traditional Airbnb hosts). So the first step was to interview a large group of vacation rental owners and managers and ask them very simply:

"What are some reasons you don't use Airbnb?"

Matt's VRMB Takeaway

Cog to signify take action

This is a tremendous way for owners or managers to enter any new vacation rental market. Begin polling potential guests, invite existing players out to coffee and pick their brain, understand the pain points. Know how you can offer a better USP and you're standing on solid ground.

Step 2: Digest

Us vacation rental hosts are a complicated bunch, so I'm sure Shaun's team spent plenty of restless hours going through all the responses. And to deal with so much data, in the end they went with a statistical approach and created a priority list of the 16 most critical "reasons you don't use Airbnb," ten of which Shaun walked me through during the call and I have featured below (the remaining six I will publish in the coming weeks):

  1. Your cancellation policies are too lenient
  2. You don't send the booking funds until after arrival
  3. Your cleaning fee cap is too low
  4. You don't connect to my PM software/channel manager
  5. You don't allow CTA (close to arrival) / CTD (close to departure) restrictions
  6. You don't have an account management team to help
  7. You don't support MLOS (minimum length of stay)
  8. You don't support Dynamic Pricing
  9. Your iCAL integration doesn't update quickly enough
  10. You don't offer any listing building support

Step 3: Get To Work

It would have been very easy for the Airbnb team to deem some of these items too complicated, too costly or simply impossible. But with some autonomy (remember, Shaun is now running "the vacation rental department") they made a clear decision to begin fulfilling every single one of these requests, checking items off the list, and eliminating friction points.

To date, Shaun has resolved 14 of 16 of the most requested items.

Here are the corresponding fixes (to the 10) we walked through:

  1. Your cancellation policies are too lenient — they added 30 and 60 day super-strict cancellation policies
  2. You don't send the booking funds until after arrival — they added payment to host 30 or 60 days before arrival, depending on the cancellation policy selected by the host.
  3. Your cleaning fee cap is too low — they increased cap from $300 to $600 plus 15% of rate.
  4. You don't connect to my PM software/channel manager — they built four beta connections to highly used software (PMS) vendors (Live Rez, BookingPal, Kigo and LeisureLink) with more to come in 2016.
  5. You don't allow CTA (close to arrival) / CTD (close to departure) restrictions — they added CTA and CTD functionality to listing page tools for all VR hosts
  6. You don't have an account management team to help — they hired seven account managers for key US VR regions, created vr@airbnb.com mailbox for general questions and a landing page for information sign-ups.
  7. You don't support MLOS — they added MLOS-bydate functionality to listing page tools for all VR hosts.
  8. You don't support Dynamic Pricing — they now support LOS and BW discount rules through the four connected software (PMS) vendors.
  9. Your iCAL integration doesn't work — they increased iCal update frequency from 24 hrs to instant.
  10. You don't offer any listing building support — they completed 3rd party agreement with Upwork, who will help build high volumes of listings for hosts at no cost to them!

Why Am I Sharing This?

I will feature the remaining 6 fixes in the coming weeks.

And apart from a lot of the other useful information about their entrance to the world of vacation rentals, which I have shared in this Inner Circle thread introducing new member (and Airbnb team member) Brent Boone, I felt it was worth sharing Airbnb's methodical process with you not because it's rocket science...

But rather, because it's a simple yet oft-forgotten reverse engineering process that successful hosts can use to make our vacation rentals even more spectacular:

Be academic in surveying what your guests want > Deliver it in the most ideal way possible

We do so because we are after long-term success.

And we know it's not easy work, but we're willing to put forth the effort to "do it right."

It is what makes us different from our competitors down the street.

@Airbnb Reveals 3-Step Plan To Enter The VR Market | Things Get Iiiiinteresting For @HomeAway @bookmorenights

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I have often asked myself, "If I was the CEO of a major listing site, how would I handle all this chaos?" Except I never really have a good answer.

But now I see in Airbnb's entrance process: unrivaled commitment to giving clients what they want, strong adherence to statistics, and consistency. This is gonna be my new motto. And whether you use Airbnb or not, hopefully your own business can benefit from learning their entrance to the vacation rental industry as well.

P.S. This is the first article I've done about the VR industry (in an "updates" sort of way) and I really enjoyed it. It's definitely different than the kinds of posts I usually write and definitely taught me a lot. If you enjoy/dislike, feel free to let me know in the comments section. 

Matt Landau
October 28, 2015
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