This week, Beyond attended the VRM Intel Data & Revenue Management Conference in Charleston, SC. The third annual conference brought together industry experts to discuss the important emerging topic of revenue management in the short-term rental industry.
As one of the most innovative conferences in the industry, there was a lot to cover (even during an early morning power outage). Here, we’ve compiled our top takeaways from an exciting week.
Focus on Forecasting
It’s hard to talk about short-term rental revenue management and not talk about forecasting. Preparing for the future is an essential part of operating a short-term rental business, and the topic came up in quite a few sessions.
While there is no “right” way to create a perfect forecast, some panelists shared their thoughts on best practices. Using a blend of historical data from multiple years, as well as recent pickup and pacing reports, is key when forecasting for the future. It’s most important to create a forecast for the near term over the next 90 days, but it doesn’t hurt to forecast for an entire year alongside an annual budget.
Sarah Franzen from Natural Retreats also mentioned that the significance of forecasting really comes from comparing it to your actual performance.
Revisiting the accuracy of a forecast is a crucial step in optimizing the process even further.
Working with OTAs
Online travel agencies remained prevalent at this year’s conference, with no shortage of conversations about channel management and distribution optimization. Expedia and Airbnb shared best practices for managing listings within their platforms, including the use of promotions and discounts to increase booking pace and occupancy.
It’s of course important to make sure that a promotion strategy aligns with your overall revenue management strategy to avoid any loss in average daily rates (ADRs). Distribution is a major part of any revenue management strategy, and the use of channel managers can help enable property managers to expand their booking audience and drive revenue.
Fun with Fees
Another big topic at this year’s DARM conference was regarding fee strategy and structure after many property managers reviewed their fees over the past year. Cameron Felton from Evolve Vacation Rentals made a point to say fees should absolutely be a part of your revenue management strategy, but they shouldn’t necessarily be included in rental revenue when looking at analytics.
Fees can have a huge impact on the guest booking journey and should be taken into account when reviewing a revenue management strategy. Some property managers made note of increased fees over the past year to account for higher operating costs coming from increased occupancy levels and higher cleaning standards.
The lesson here is to review how your fee structure is presented to the guest and understand the impact that any changes to your fees may have on overall booking pace.
While the variety of sessions covered most aspects of revenue management, the highlight, like in previous years, was the Battlegrounds. This year featured a mix of tech centered around revenue management, from shopping cart abandonment to strengths of property management systems to traditional pricing tools.
With 8 contenders, it was great to see how technology has evolved to support the vacation rental revenue management space. A few of our highlights were:
- Rented’s Andrew McConnell started it off with the most recent entry into the dynamic pricing space and their new pivot with ART, which offers a basic approach to do dynamic pricing using well adopted customizations that PMs can operate.
- DemandIQ, the most innovative of this year’s entries (and rightfully won the award), went off without a hitch even without Amy Carpenter to run the show. The ability of using Google Tag Manager to access and understand data around quotes on your website is very exciting and one of the new fronts in RM!
- We have long loved portfolio analytics, which is what Pricelabs has been focusing on recently. That, and an upcoming UI/UX update, must be what their users are understandably ecstatic about.
- RevMax is looking to end its monogamous relationship with Streamline and will start to see others. We are all curious to see how it navigates the partnerships with competing PMSs.
- A bit different from the other entrants, but related to increasing revenue, Navis focused on the buying experience, showcasing its ability to counter shopping cart abandonment which rose during Covid.
- Track and LMPM were there as well, but less focused on RM. However, all good RM strategies rely on a solid PMS, so their attendance was appreciated for context.
- Lastly, the Wheelhouse team, with a well poised pitch, is re-engaging on its pricing tool and pushing for transparency into its algorithm.
It was a great few days in Charleston discussing revenue management and data in the short term rental industry, all thanks to Amy Hinote and the VRM Intel team. Beyond is excited to join VRM Intel again in December at the Vacation Rental Women’s Summit - we hope to see you there!