There’s a growing trend in niche listings sites in the short-term rental industry.
Obviously, everybody has heard of Airbnb and Booking.com, because the large online travel agencies are visible and prominent and generate the largest share of the business. (According to Transparent Intelligence, globally, the short-term rental supply listed on major OTAs grew by 33% from 2017 to 2018 to reach a total of 7.1 million properties.)
But smaller niche sites are emerging as websites tailor their offerings to specific groups of travelers. This trend is evident in recent investment in sites such as the Plum Guide, which received £14 million in funding last March, and in Spotahome, a Madrid-based rental property listing site that signed a $40 million investment deal in June 2018.
If we use the analogy of "shipping" to talk about listing sites, we could consider the benefits of big container ships as being large, stable and dependable when storms hit. They stay on course, ride the waves and have been around for a long time. The large OTAs, like HomeAway and TripAdvisor, are the big ships of the short-term rental industry.
Most property managers rely on these "big ships" for their leads, but they aren’t the only vessels in the water, or in the market.
here are the middle-size ships, too, the boats that motor in the wake of the larger ones. They can change course more quickly than their larger counterparts, but they also want to be like them (and perhaps didn’t quite make it).
These copycat boats, let’s call them, still have a way to go and often get swallowed up in the process because they don’t offer a point of difference in the vacation rental market.
Enter the small sports boats, or niche listing sites, which can move fast or move slow, are flexible and can change course when the weather gets rough and can dock just about anywhere. These nimble, smaller vessels - the niche listings sites of our industry - offer a fresh opportunity to property managers.
They may not be as stable as the container ships, but sometimes, just sometimes, the sports boats grow and become a larger OTA. We all remember the unknown, niche sharing economy website that had a big vision and exceeded that vision to change the travel industry!
This is one of the reasons why I feel that niche sites deserve our attention, but there are other reasons to explain why we should be allocating time to this area of business.
Why niche
It’s worth remembering that travelers’ needs are changing, and, as an industry, we need to go back and ask ourselves some basic questions and to reassess. Why do people travel? What do they want from their short-term rental property? Do they want to bring their dog, are they digital nomads or is it simply a bleisure trip?
People travel for countless reasons now - even citing going to a place or property as "Insta-worthy" - and by honing in on these motivations we can understand how to reach new customers and markets (through niche sites).
For example, one property can be listed on several niche sites for different reasons, opening up a myriad of new customer bases. An apartment in Lisbon might be up on Anyplace to catch those footloose travelers taking time out of work/life commitments, as well as on Coolstays in the "budget cool" category or on 2nd Address if it’s also appealing for business travelers.
Just as sports boats, on account of their size, can enter any harbor reaching any number of new ports regardless of size, niche distribution sites can increase properties’ exposure and reach new markets in a really targeted way. As in all areas of business, if you cultivate and own a niche area you can quickly become an expert, and the same applies in the short-term rental industry.
If you do your research and scout out the most appropriate niche sites, property managers can jettison their assets to the top of the search listings rather than fight for space on the large OTAs.
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For example, pet owners might look at BringFido for specific recommendations; those wanting to give back to the community can research on Fairbnb.coop; and even cannabis travelers can find a home on Budandbreakfast. The possibilities are endless. So far we have identified 280 niche listing sites and as we enter 2020, and this trend is only growing.
Another way into niche sites for property managers is by looking at those which are hyper local: true experts in their area offering an informed selection of places to stay like Florida Rental by Owners or sites specializing in helping specific nationalities travel abroad like Dormoa for Italian travelers.
On top of that, we have the curated lists, such as Sawday's, Coolstays and the Plum Guide. The latter has a 150-point test which each rental has to pass before being listed on the site, which is the very definition of curation.
How to widen the net
When you round up the niche sites we’ve discussed here - the travel trend sites, the top local ones and the curated lists - you start to build a picture of how wide the reach is for vacation rental property managers, how many places the sports boats can visit and how many customers they can reach.
It’s impressive, and it makes good business sense for those offering accommodations to a growing traveller base to widen the net.
However, widening the net takes research; it takes work, and, before technology stepped up, it was far too time consuming to list on a wide variety of sites. But this is where technology is helping us to perform better.
As the enabler, specialist tech allows managers to list on and manage a large number of channels. Tech is the shortcut that we need in vacation rentals, and it is ultimately what is allowing this industry to grow at such a rate.
For instance we find that property managers that partner with Rentals United for their channel management increase their bookings on average by 25% and save on average 40 hours a month of manual work.
If, as an industry, we want to expand further and increase our marketing mix to reach new customers, get new business and ultimately elevate revenue, then niche sites are worth taking seriously.
Just as we will always have a need for the large ships in our waters due to their capacity and stability, we certainly have an opening for the nimble sports boats to motor alongside them, to widen the market and to offer variety.