Speakers at the 10th annual Hotel Data Conference discussed how hoteliers can better understand and embrace alternative accommodations.
NASHVILLE, Tennessee—The alternative accommodations space is seen as a threat to some in the hotel industry, but some hospitality experts have found ways to embrace it.
Speakers on the “Alternative accommodations: Are they really alternative?” panel at the recent Hotel Data Conference said there are ways to mesh the hotel space and alternative accommodations. Panelists agreed this can be achieved through professional management.
“Airbnb is (a) bedroom or a couch. .. What we’re all doing is more professionally managed, vetted options,” said Jon Wohlfert, co-CEO at Reside Worldwide. “And when you think about it, what is a hotel brand? A hotel brand is a distribution of customers into their inventory. We have inventory that has a standard, and as long as you maintain that standard and the experience is similar, then you would think that we would be an extension of a hotel brand.”
Steve Caron, VP, head of vacation rentals at Vacation Rentals by Choice Hotels International, said there are a lot of individual properties available on the professional management side, which aim to provide the same level of service that a hotel would, for people who have standards.
Wohlfert added that professionally managed options ensure that short-term rentals are following the rules, which is a concern for many hoteliers.
“One sub-segment of the professionally managed side, too, and probably a concern to hoteliers is the legality of it,” he said. “Whether it’s from zoning or whether it’s from taxation. We know at Airbnb that people are taking cash into pocket and then not paying occupancy or hotel tax, and I think the one element of this alternative accommodations space and the professionally managed accommodations is you have to follow the laws.”
Booking and technology
A successful alternative accommodations platform has to have the right type of technology, sources said.
Caron said there once was a lack of data systems for booking alternative accommodations, but that’s changing.
“(Customers) want hotel-like booking because it works and people understand it,” he said. “It is being embraced by the best of the professional management companies.”
Similar to hotels, alternative accommodations bookings are moving to third parties, Caron said.
“It’s online, it’s real time, and more and more it’s third parties aggregating inventory and bringing it to the mainstream,” he said, adding that he thinks there’s more of that to be seen in the space.
Since millennials make up a large part of the customer base for alternative accommodations, Wohlfert said companies need to have the right technology in place because they want to book trips without talking to a person.
Getting into the space
Hoteliers who want to get into alternative accommodations will also need the technology to get the business up and running, said MJ Paschall, visionary leader for AKA Hotel Residences.
“More than 55% of reservations are made (on mobile devices) … especially in our space,” she said.
Caron added that hotel companies need to have people who are familiar with alternative accommodations on their teams to get into the business.
“I think it is fool’s gold to think you can jump in without having people from the industry who understand the product, because this product is oftentimes individually owned by a homeowner, so the value change is distinctly different than that of a hotel,” he said. “I think as you’re entering the space you have to know how this product works, how the dollars flow throughout the ecosystem, how the pricing models work…”
Marketing the business
When going out to find business, speakers had varying approaches to how they talk about their companies.
“In our brand, we consider ourselves a solutions provider,” Wohlfert said. “We ask them what they are looking for, and we solve for that.”
Caron said Choice tries to present the value proposition for vacation rentals to customers.
“Again, the hotel side is very mature at Choice, the vacation rentals side is very new,” he said. “We try to present what is the value proposition for the vacation rental side. … The traveler already knows what their (vacation) is, they know why they are traveling, they already have a need they are trying to express and consult for, so what we try to do is present, ‘Why is this product what you need?’”
Paschall added that it “depends on who you are selling to and how you are trying to represent yourself.”