Domestic leisure travel is booming this summer - a result of pent up demand for that long-awaited getaway, and the fact that international travel restrictions are preventing many from taking their annual summer vacation overseas.
Traveler’s wants, needs and expectations have changed dramatically since the pandemic took hold, and, for now, vacation rentals have emerged as the preferred accommodation option. Short-term rental property managers everywhere are experiencing a busy vacation season and are turning to smart tech to manage the back-to-back reservations and service guest demands.
Without question, tech adoption in the short-term rental marketplace has accelerated at a phenomenal rate over the past year - terms such as "contactless," "hands-free" and "operationally efficient" have been much discussed as the industry has adapted to new guest expectations and a very different world. Hostfully's study shows the average vacation rental management company now spends approximately $51 per property per month on tech, showing investment in tech is being taken seriously.
As vacation rental bookings boom, so does smart tech. But what’s next for this smart revolution? Will this upward trajectory in tech adoption continue? Here we’ll explore whether property managers will continue to stay on top of the latest innovations in smart property automation, or whether we’re about to reach a saturation point.
The driving force behind the smart revolution in vacation rentals
First, let’s consider the driving factors behind our new attitude to smart home tech:
1. Digital natives have digital expectations
Thirty-four percent of U.S. broadband households have a smart home device. But does this appetite for "teching up" at home carry through to expectations around your vacation rental experience? I believe it does. Today’s traveler demands a high level of digital functionality and tech automation throughout their travel journey. In fact, for the growing number of digitally native millennial and Gen X travelers, it has become a basic expectation.
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Our recent PointCentral customer research revealed that not having the "basic" smart home tech in place in a rental - such as keyless entry and a connected thermostat setting a comfortable temperature for guest arrival - sets a trip off on a negative footing. While many guests won't want all the technology they have at home (they are taking a vacation to switch off, after all), proptech solutions that help them enjoy their vacation - predictive technology to keep the home working properly, tech to keep guests safe, speakers and connected lighting that can auto turn outside lights on and off - are fully embraced.
2. The pandemic effect
It’s panning out to be a great summer season for the vacation rental industry. Alongside consumer excitement and appetite for travel, guest anxiety over health and safety remains high. Smart home tech developments have come a long way in recent months to address and alleviate these concerns: socially distanced stays are made possible through direct-to-home check-in/out and keyless curb-to-couch access. Plus automated cleaning processes, with verified checks and balances, offer reassurance that you’re stepping into a safe and hygienic vacation environment.
3. Property managers demand greater operational efficiency
Aside from the undisputed "guest delight" afforded by smart home technology, property managers have been quick to recognize the operational benefits of having the right tech stack in place. HVAC analytics (monitoring and reporting on overuse and damage) are a prime example of how smart property management can protect a property’s assets, increase productivity and drive efficiencies. Savings of up to 23% on heating and cooling are achievable with the right systems in place. Add to this the efficiencies from contactless check-in, keyless work orders, water leak detection, light sensors … and smart home technology is a no-brainer for property managers wanting to protect their assets and operate with maximum efficiency at a very demanding time.
An upward trajectory?
Much has been written about how consumer demand for travel is set to fuel the post-pandemic recovery. And a recent report by AirDNA hinted at strong growth in the short-term rental market versus 2019. The trend for remote working and the consequent demand for flexible living is adding further momentum to the buoyant vacation rental industry. However, things are constantly changing and the industry needs to be nimble and flexible to respond to both market and travel trends.
Smart home technology can be a smart way to address back-to-back bookings.
For example, as COVID shifted traveler interest away from urban markets, traditional beachside and mountain vacation rentals have been enjoying significant growth in demand as a result. Some of this will naturally shift back to urban settings over time, but some will remain in the form of new demand for the more traditional markets. Vacation rental property managers need to act quickly to capitalize on this traveler demand. This is where tech comes in. Many property managers have been unable to get qualified staff on board quickly enough to fill their needs. Adopting technology solutions to make existing staff operate more efficiently has enabled managers to run back-end processes remotely and with lower staffing levels, while still meeting new guest expectations around cleanliness (cleaning protocols, direct-to-home check-in, etc.) and safety (keyless access).
Add to this the asset protection and operational efficiencies mentioned earlier, and the gains from investing in smart home innovations clearly tip the balance in favor of tech.
Smart home technology can be a smart way to address back-to-back bookings. Not just in the context of short-term rentals, but in the wider hospitality industry. Hotels have been using keyless check-in and automated temperature control for years, and this sector is also embracing the smart revolution by moving into new tech-enabled categories such as app and RFID-based services.
Is there a tech saturation point?
Globally, property managers are building up their tech stacks, enjoying the efficiency benefits, as well as the owner reassurance and positive guest reviews. So is that it for smart tech? Are we about to reach a saturation point? As with all technology, it’s important to stay on top of the latest innovations. Tech tools will constantly evolve and property managers need to take the time to review their tech stack periodically and make sure that it is delivering the best possible experience for them, their staff and their guests.
Tech won’t solve everything. But property managers can leverage smart home automation to minimize the activities that don’t differentiate them, leaving them free to spend their most precious resource, namely their time, on the things that really differentiate them, thereby creating value for owners and guests alike. There isn’t an end point to this tech evolution, we’ve only just started.
Viva la "smart" revolution
What’s special about the vacation rental industry, and the wider hospitality sector, is it will always be a relationship business. Smart tech works in conjunction with this to enhance the guest experience and the property management business. As the short-term rental industry continues to thrive, the demand for smart tech solutions to support this boom is also set to soar.