This is a guest post from Courtney Hutton
- vacation rental owner & business owner
(Maui Vacation Rental Services)
This week I received my annual “your listing is about to expire…renew today” email from HomeAway and VRBO. And every year I go back and forth on whether or not they are worth renewing; whether or not it is worth the money. I wrestle with ditching one listing and renewing the other and whether or not we would miss out on potential opportunity. I continue to agonize over the decision right up until the expiration date and then depending on how I am feeling on “D” day and how the bank account is doing, I decide which listings to renew. I guess last year I was feeling pretty good because I renewed both HomeAway and VRBO.
We have been advertising our rentals with one or both of these vendors since the day we purchased them. When we purchased our first property in 2007, it was cheap. Like dirt cheap. I believe the listing on VRBO was $99 and $199 on HomeAway. The membership included all the photos I could dream of listing and excellent ad placement. I think there were only a few units listed in our complex so the inquiries were plentiful. As the years have passed the fees for both HomeAway and VRBO have gotten crazy expensive and supposedly the more you pay the better your opportunity is. It feels like every year there is a price increase in some fashion, and more and more properties are being listed. We are now little tiny fish in a big, big pond, even on Maui. At last check HomeAway has 260,000 active listings!
So, like I do every year, in general conversation with my husband, I ask his opinion. The conversation always ends up in the eenie, meeny, miny, moe scenario, like it did yesterday. We arbitrarily came up with renewing VRBO and ditching HomeAway. I think we both wanted it off our to-do lists and to move on. But then I got to thinking…could we survive on just our website traffic, which in my perfect world is how things would turn out. That would save us big chunk of change every year and it kills me that we are THAT dependent on these two vendors.
We collect a substantial amount of data for our properties so it only made sense to take a deep dive into the date we have collected. And honestly, up until yesterday I didn’t understand why I had to enter all sorts of information into the massive spreadsheet my husband created. In my mind it has always been a bit of a pain and an extra step that I generally don’t feel I have time to take. Who cares where they came from as long as they book and pay. That has always been my motto.
I am going to share with you the last two years of raw data we have collected. I think you might find the data both interesting and surprising.
In 2010
Ad Source Source Revenue Source Percentage # of Reservations
Website $15819.63 72.46% 18
HomeAway $3174.14 15.54% 3
VRBO $487.71 2.23% 1
Return Guest $1314.71 6.02% 2
Referral $1036.78 4.75% 2
Traffic:
The website averages about 550 page views per month and in 2010 we had 137 conversions (inquiries) for the year with 18 bookings.
We had no direct referrals from HomeAway or VRBO to the website.
In 2011:
Ad Source Source Revenue Source Percentage # of Reservations
Website $15043.59 55.06% 16
HomeAway $6073.59 22.23% 9
VRBO $4071.77 14.90% 3
Return Guest $0 0% 0
Referral $2133.51 7.81% 2
Traffic:
The website still averages about 550 page views per month. In 2011 we had 158 conversions and 16 bookings. We had a 3% referral rate from VRBO and no direct referrals from HomeAway.
So, what do all these numbers tell us? For one, that we have not been making good business decisions in the past by taking the eenie, meenie route; and two how important it is to collect AND use this type of data to make better informed decisions. We have been collecting the data since the first reservation but have never used it. As of 24 hours ago I was going to cut the ties with HomeAway for next year when in fact that listing brought in 22% of the property’s annual revenue. Clearly, I would have been doing the business a disservice and now I feel like an idiot. A total lose-lose situation.
Based on the data we collected, all we know is how much money we book on an annual basis and how many potential reservations we could have had. What we aren’t currently capturing is the data on the inquiries we receive to decide whether or not we could survive solely on the website. What we need to do after we renew the HomeAway and VRBO listings is to begin tracking every inquiry we receive. The dates of the stay, length of the stay and the source so we can determine if the 158 website conversions in 2011 would have been able to fill the stays the vendors provided us. We plan to begin tracking this data in May so that when next year rolls around and I get that joyous email from HomeAway and VRBO I can without a doubt and in complete confidence make an informed decision (hopefully that we can survive solely on the website).
The moral to this story is to collect data, and a lot of it and put it to use. Keep in a spreadsheet and keep it updated so that when it is time to renew your listings you know where to put your money for the highest return.
The post Eanie, Meenie, Miney…NO! appeared first on Vacation Rental Times.
