Travelers now have more choices than ever when selecting where to book a vacation rental. With all the new choices out there, lets concentrate on the most popular marketplaces; Airbnb, HomeAway, VRBO, and Tripadvisor’s FlipKey, and explain how they operate compared to Tripz.com.
Why is this important to know? Well much of how they operate effects how much travelers pay for their vacation rental. Top marketplaces are doing their best to wrestle money away from travelers and owners for the new found convenience to find and book vacation rentals.
Lets start with the largest source out there, Airbnb. Airbnb got their start in the shared economy space by doing room shares and shared spaces. Quickly thereafter they evolved to offering whole units and homes. Their model is attractive to owners as there is no commitment to get started financially or long term contract. Anyone can basically list their space without any investment or work. This is great for someone looking to make some extra cash but not always great for the traveler looking to enjoy a vacation. Many times these rentals are not set up well or prepared for travelers. When it comes to the money aspect, Airbnb take on average 6% of the room rate from the owners and they add on average 12% on top of the room rate to the travelers. Thus leaving you the traveler paying 18% more for a rental for the convenience of using Airbnb. The percentages are important to understand, as that is their source of income and why communication is limited to avoid booking outside their platform.
Next you have VRBO and HomeAway. I will put them together as many travelers are still unaware they are the same company. They are most well know for offering the whole home per their marketing campaigns and the fact they have never done shared spaces. VRBO and HomeAway tend to have more professionally managed homes whom commit to spend money on advertising their homes. Their model has adapted a lot over the years in but is now narrowed down to two options for owners. They can pay a one time annual subscription or a commission model. Both of these model require the owner makes their home online bookable on HomeAway/VRBO. Why is this? Well much like Airbnb in addition to the fees they charge owners to advertise they charge travelers a service fee, that again averages 12% but can be as high as 14%. So as travelers are paying the added service fee, and with the commission model on HomeAway/VRBO at 10% giving as much as a 24% gap. To make matters worse with Expedia acquiring HomeAway/VRBO owners can opt-in for additional distribution on Expedia sites taking up to 23% away from the owners. Couple that with the service fee, travelers could pay as much as 37% more than what the owner is willing to take for a nightly rate. Granted, owners will accept this gap often to obtain a new traveler and work to get repeat business and attempt to avoid fees for future rentals.
Travelers could pay as much as 37% more than what the owner is willing to earn for a nightly rate.
Finally there is Tripadvisor and their vacation rental sites which are currently pushing under their Flipkey brand. They also own sites like vacationhomerentals.com but have lately moved away from promoting as heavily. Tripadvisor’s Flipkey mostly brings on new properties with a no up front cost commission model but does have an annual subscription model as well. Despite a commission model and a subscription model they both in fact take a percentage from owners nightly rates. On the traveler side they are one of the more expensive options with their service fee to the traveler averaging 14% but can go as high is 16%.
Now you have Tripz.com. We keep the vacation rental space affordable and direct the way the industry was built. Travelers want to talk to owners before booking and know they are getting the best deal. Getting more for your money is how the “alternative accommodation” space as its categorized has grown so much. Tripz.com offers one program to owners, which is an annual subscription to advertise their home. There are no commission models or any fees taken from the owners to pull from the nightly rates they offer travelers. On the traveler side Tripz.com promises to never charge travelers unnecessary service fees. Ongoing commission models and services fees only drive up the cost of vacation rentals. When there is a gap of 18% or more for the convenience of finding the home on a popular vacation rental marketplace that is just not best for the traveler or the homeowner. Tripz.com wants you to connect directly, book directly, and save money.
Removing the fees saves travelers hundreds