How Hospitality Entrepreneurs Can Best Leverage New Technology - Forbes

Post written by

Sabrina Parsons

Sabrina Parsons is CEO of Palo Alto Software, based in Eugene, Or, and developer of the best-selling business management software, LivePlan.

Online technology has introduced many great tools and new ways for more traditional businesses to engage customers. Customers have come to expect instant service and information about a product or service. They want to be able to purchase online and get questions answered immediately, and increasingly, they are using online communication methods instead of phones. These changes have pushed smaller businesses to embrace technology in order to keep their businesses growing and attract this new kind of tech-savvy customer.

In the vacation rental industry, giants like Airbnb and HomeAway have completely changed how people rent short-term vacation rentals and have increased the total market of renters. More people are renting short-term vacation rentals instead of reserving hotels, and these big players have spent a lot of marketing dollars online to grow this market. A survey from Goldman Sach's in 2016 (via VRM Intel) discovered that of the consumers who rent through peer-to-peer rental platforms for the first time, half of them don't go back to hotels. Vacation rental property managers have contributed to the growth and have taken advantage of these platforms as they use multiple platforms to list their properties.

While big tech is good for the market, it's also made it difficult for smaller property managers and owners to engage with their guests and control experiences. How can they take back some control while maximizing tools like Airbnb and HomeAway? What are the biggest challenges they face with all this new technology? 

First, let's go over some of the challenges:

Too many tools and platforms.

Technology has brought many great tools to the hospitality industry. That's exactly the problem facing vacation rental property managers: There's an app for everything. Owners of property management companies are constantly bombarded by new software, more data and the latest dashboards. They have to wade through all of them to understand pricing, features, the benefits and how all the technology will interact with everything else. This can be overwhelming but also cause a great deal of FOMO stress. No one wants to say "no" to that perfect tool that will change their business for the better.

Increased cost for guests renting through platforms like Airbnb and HomeAway due to platform service charges.

While these big players in the vacation rental industry have brought more guests, they have also made vacation rentals more expensive for guests. These platforms have to make money, and they do that by charging the property owners (or managers) as well as guests. It used to be that vacation rentals were almost always cheaper than hotels. These days, because of all the fees and taxes involved, the prices are pretty similar or can be even more expensive. 

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