More than ever before, the line between “hotel” and “home” is becoming blurred: few in the industry would still deny that today’s traveler wants lodging to feel more localized, personalized and authentically welcoming. In short, we want to stay in a “home” wherever we travel.
NB: This is a viewpoint from Parker Stanberry, CEO of Oasis Collections.
While consumer demand has driven the explosive growth of the short-term home rental marketplace over the past decade, the hospitality industry’s biggest players are just beginning to acknowledge the need to get a competitive foot in the door.
Without being able to offer the option of short-term home stays, some of the world’s leading accommodations providers risk losing out on a fast-growing segment of their market.
AccorHotels, one of the forerunners, which acquired a 30% stake in my company Oasis Collections in February of this year, has also acquired full-service home rental provider Onefinestay and a stake in French vacation-rental operator Squarebreak.
These are bold moves that acknowledge the fact that a growing number of travelers value the authentic experience of staying in a local home over the predictability of a traditional hotel stay. It also, in a not-so-subtle way, declares that large-scale hotel owners and operators need to acknowledge and compete with the likes of Airbnb.
But is this the end of the minibar as we know it? Not likely.
On the flip-side of the coin, Airbnb has acknowledged the demand for fully-serviced home rentals by quietly launching Sonoma Select, a pilot program of select homes in Sonoma, CA that offer 24-hour check-in, local amenities and Instant Booking.
Announced last week and rolling out this summer, it’s one of the first efforts the company has made to provide a consistent level of service and standardized guest experience that competes more directly with hotels.
That being said, given the wide-open, peer-to-peer nature of the platform, it will be a major challenge to offer consistency of product and service on a global scale.
We’ve reached a tipping point in the hospitality industry where a critical mass of consumers are demanding a more authentic accommodation option that lets them experience a destination less like a tourist and more like a local.
Yet, unlike the young, adventurous early adopters that fueled the early growth of the short-term rental industry, this mass of travelers is also accustomed to the creature comforts offered by a traditional hotel. Hence the interest in companies like Oasis, as well as services which aim to professionalize vacation rentals - such as Austin-based TurnKey.
Anthony Lee, Managing Director of Altos Ventures, who lead the investment in TurnKey, said:
"As interesting as it is to have the local and authentic and unique experiences, our research was showing more and more that people wanted to have consistency and quality also, almost like a hotel-like experience. We thought ‘there’s going to be people who build brands in the short-term rental world."
The industry leaders of tomorrow will be the ones who are quick enough to accommodate this dynamic shift in travel culture by creating a product that combines the authenticity of a home with the comfort and consistency of a hotel, while bringing something new to the party that delights and inspires the traveler.
The recent activity is also making distribution increasingly competitive, with the OTAs jumping in (witness TripAdvisor's acquisition of FlipKey and Expedia's recent purchase of HomeAway) and Airbnb starting to behave more like a distribution channel than a pure peer-to-peer platform (witness its recent partnership with corporate housing company Bridgestreet).
Even hotels are beginning to flirt with adding apartments/vacation rentals to their own sites (Accor plans to add properties from Oasis, OneFineStay and Squarebreak).
Meanwhile, startups focusing on enabling property owners and managers to more efficiently manage and distribute their properties are cropping up, a la TurnKey and Vacasa. I'd imagine that this corner of the industry sees some consolidation in the near- to mid-term.
NB: This is a viewpoint from Parker Stanberry, CEO of Oasis Collections.