Kigo Blog

5 Ways to Lose Guests and Alienate People

Follow these five tips if you never want to hear from your guests again.

Customer Service is king. Never underestimate the power of less than perfect service to alienate your guests and turn them away from your website. It can take just one bad experience, left unchecked, to make sure that your guests only ever use your business once. News of bad service spreads like oil on the surface of a lake, and people follow this advice – in the opposite direction of your business. We all know that one place where a friend had a terrible experience, or even just a mild annoyance, and now avoid it like a black mark on the consumer landscape.

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Your reputation is fragile and needs to be treated with care. Imagine every transaction as being as delicate as penguins swapping over an egg. Today we’re giving you five sure-fire ways to do lasting damage to your reputation and make sure that your guests never want to use your business again.

Don’t Respond to Property Inquiries
Leaving potential guests hanging after sending an inquiry is a guaranteed way to push them towards another website that has instant property and booking information available for them. The longer you wait, the more guests you will lose. Wait more than an hour and you should take your booking rate down to about 20% of inquiries. If you want to really alienate potential guests, avoid automated response emails that give accurate booking information to every guest as soon they as they contact you.

Be Late for Appointments and Handovers
Leaving your guests hanging around outside your property means they are not likely to ever want to return. Holiday guests love being stranded outside a locked door with their luggage in a foreign country. This is one of the easiest and quickest ways you can stain your reputation and make this booking your last from these customers. If you are running late, not informing them with a call will only help you further to confine these guests into the leagues of ‘ex-customers’.

Treat Every Guest the Same
What’s good for the goose is good for the Gander? If one guest loved your service then they all will, right? Avoiding personalised service will make your guests feel generic and basically unwanted. Small touches of personalization is the best way to build guest loyalty and encourage multiple bookings. By treating every guest as interchangeable, you give them no reason or incentive to choose your business over the stacks of competition.

 Always Aim for the Bare Minimum
Don’t do anything you don’t have to. Do not do anything that was not agreed upon beforehand. Leave your guests to work out everything for themselves and give no details about the local area. Customer service is all about ensuring your guests do not just get what was advertised, they get more and they enjoy their stay in your property. Ignore this principle and you will soon see your booking numbers dwindle. Providing just a small element of something special or unexpected   

Once they’ve paid and left, forget about them.
Don’t follow up with your guests about how their stay was. Do not ask them for reviews or find out if there was anything you could improve on. Make no attempt to learn anything about your guests and how they enjoyed their stay. Do not add them to your promotions and email campaigns.

 With these 5 tips, you be sure that no guests will want to book repeat stays with your business. So, if you don’t want to put off prospective guests and actually want to encourage multiple bookings, make sure that you don’t follow the advice above.

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Handling the Pressure. Coping with the Ups and Downs of the VR Industry

Property managers know that there is no guarantee in this business. For many, it’s a dream job that entailed a lot of sacrifices and a loss of security to achieve. So, if anything does start to go wrong it can feel like a lot to deal with. From a burst pipe in another country or just a slow summer season, small disasters can be fairly common. So, what can you do when things go wrong and you’re under pressure? Today we’re talking about four of the things that keep vacation rental managers up at night and how to turn disaster to your advantage.

Pressure guage at the Steam Museum in Kew, London

Pressure gauge at the Steam Museum in Kew, London



 Weather
As someone who has holidayed frequently in the North of England, I can testify that the weather is not the be all and end all of a great holiday. Rain and other bad weather can always strike and even the best property managers can’t control this. Have suggestions of rainy day activities for you guests such as local museums, indoor shopping centers or other places of interest in your guest handbook. Sending a quick message if the weather is bad to mention these activities is a nice touch that shows you care about the enjoyment of your guests’ trips and understand that they may be looking for something to do. A selection of books, films or games are another good way for your guests to pass a couple of hours in a downpour.

 Law and Order
We’ve spoken before about how some cities are in the process of introducing regulation for short term rentals. Some of these regulations can have a real impact on your business potential overnight, being one of the most stressful things to befall a property manager. The best way to cope with regulation is to make sure you know exactly what is happening and that you properties comply with the rules. Having to make adjustments to your business will always be less stressful, and less costly, than falling foul of the local authorities.

Once you have done everything you can to meet the new laws you can concentrate your efforts on changing these laws. It can and has been done before and there is a growing weight of opinion that support the rights of vacation rental managers.

 Problem Guests
This is something that keeps any property managers worrying because it’s just so hard to plan for. Thankfully, a real nightmare guest is a very rare occurrence. Having comprehensive insurance will give you peace of mind from the worry of any damage. Having clear guidelines of what your guests can expect from you and your property should also help reduce misunderstandings. If all else fails, stick to the standards you set as a property manager and remain professional. If you do get complaints then you always have chance to respond and be professional.

 Popularity and Competition
As a business, there is no sacred land of having ‘cracked’ success. If you do manage to enjoy popularity with your vacation rentals then the secret is to never assume that it is going to last forever. Popularity can fade as tastes change and new competition enters the market. How to deal with a slump in popularity is to continue evolving and offering the best service and product in your area. If a once popular property has seen a slide in bookings have a look in your area, see what the competition are doing. Check to see if it could use an update, tastes change quickly and skipping updates can start to lose you bookings alarmingly quickly. Competition is good as it shows there is a healthy market for your product, what you need to do is to make sure that you remain your customers’ first choice.

 Unfortunately, pressure is part of managing rentals, you can never be able to avoid it altogether. The secret is to manage it and to use it to try to achieve more. And, of course, one of the best ways to avoid high-pressure situations is to have a property management system that takes away the pressure and allows you to concentrate on what really matters.

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10 Steps To Prepare your Property For Summer

How to make sure that your properties are ready for the busiest time of the year.

 Just before the summer is the best time to give your property an update to attract new guests and give repeat guests another reason to book. I’m spring cleaning and trying to part with old clutter. Why can I not throw away light bulbs that don’t match the fittings of my lamps, incomplete sets of playing cards or spare loose buttons? Let’s face it, it can be hard to make a change when it comes to something as big as one of your properties. So, when getting ready for the summer you need to be brutal and clinical. The summer season can be the largest source of revenue for the entire year for many property managers so make sure your property is at its best when people are looking to book.

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With holidays, it can be that the anticipation is more exciting than the actual event, so now is the perfect time to tap into this. With the weather still being unpredictable at this time of the year filling your website and your social media with glorious images of summer will help your business start taking bookings now. Get your potential guests excited about their holiday to encourage bookings. Getting into the summer mindset a few months early will help your website maximise every summer booking.

As well as giving you peace of mind that your summer months will be lucrative, encouraging early bookings means that you can experiment with revenue management to increase the price of your properties as demand increases and the general availability of vacation rentals decreases. The more of your calendar that is booked in advance, the greater chance you have to experiment with this. You can try this and use a little trial and error to try and find the right, or you try Kigo’s automated and exact Revenue Management system that will adapt to the surge in popularity of your properties.

We’ve compiled 10 steps that will help you to get your properties and your website ready for the rush of summer, leaving you with booked calendars as the temperature rises.

 Sunny images
 The anticipation of summer is going to be key in securing early bookings so fill your site with bright, warm images. Share these new images with your guests in a consistent summer campaign across social media and your email marketing.

 Outdoor Activities
With this good weather, you will need things to suggest for your guests to do outdoors. Show off your outdoor space and the parks and gardens in your area. Beach images are always to be popular for your coastal properties.

 Local Days Out
Longer trips outside are the perfect chance to create an interesting blog that will drive customers to your site and give them useful information that even encourages them to book with you.

 Fresh Paint
 Sun beaming on crisp and glossy new paintwork will give your property a new shine and sense of cleanliness and freshness. Even just small touches like the window panes or the front door will be enough to make a property look new and inviting.

 Variation
 The summer is the best chance to secure longer bookings so you need to show your guests that there is enough to do to occupy a week or two. Have links to local activities that will interest a wide range of people and send the details of them to your guests in your summer promotions.

 Family Friendly
 Summer is a time for taking the whole family away so let your guests know which of your properties are best suited for a family vacation.

 Pet-Friendly
 If you want guests to book a longer stay, having a pet-friendly policy clearly listed will remove one more obstacle to booking for many guests.

 Open it up!
Doors, windows, everything. Let light and fresh air in and let your house rejuvenate. Open, airy spaces are synonymous with summer.

 Let Nature In
Plants and flowers are a great way to signal that your property is the ultimate summer sun destination. Smaller plants or cacti and succulents will require little care and will add colour and life to your property.

 Add Colour
Bright, summery colours, even if it’s a just a small touch will show that you are making efforts to make the transition from winter and add to the seasonal atmosphere.

  Now is the time to refresh your property, your content and your site for summer. Mark this rejuvenation and let your customers know that your property is going to the best destination for their summer vacations.

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Three Little Words : ACV

Why you should be thinking about Average Customer Value with every single booking

 What would you say if I could guarantee you an entirely booked calendar for a year? 365 days all booked up and paid for? You’d say this was too good to be true, surely? Now, what if I said that these days were all booked by different customers? 365 customers, each staying for just one night each. It doesn’t sound like such a great offer any more does it? The work involved, and the cost of managing so many different guests is going to bring with it such high costs, levels of involvement and potential problems that even having a fully booked calendar is probably not worth it.

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This is all to do with ACV. Your average customer value is too low to make this option viable. To run a successful vacation rental business, you need to make sure that every single one of your customers brings with them a higher value than it costs to operate your business.

 Every guest brings with them a certain cost for your business, this is unavoidable. These costs are more than just the costs associated with your property; cleanings, maintaining your website, your staff and running your marketing all need to be factored into your business model. The acquisition of a new customer is always going incur costs. To offset these costs you need to increase the ACV for every customer.

 In the same way, it will cost a cafe money in rent, utilities and staff for every customer that comes in regardless of what they order. To use an example, Customer A has an ACV of $1 per visit to the cafe and their visit costs the cafe $0.75 in costs and stock. Customer B has an ACV of $5 and costs the cafe just $1.90. Once you start increasing the ACV, the margin between the cost to the business and the net profit starts to grow exponentially. The higher the ACV is, the lower the percentage cost each customer has to your business and the greater the percentage profit is.

What this demonstrates is the need to maximise the revenue from every single guest. The first way to do this is to encourage longer stays. We’ve spoken before about the benefits of offering incentives for longer stays. If you consider the cost to your business that cleanings between guests, the handover of keys and staff costs involved in confirming a booking incur, then longer stays make clear sense. The cost of business is weighted towards the acquisition of new customers and there will be more profit for property managers if they can encourage guests to have a higher ACV by staying for longer in their properties.

 The next, and more profitable way to increase ACV is to add optional extras. Services, tours and customizable extras give your guests a chance to personalise their stay and increase your margins as a property manager. The profit from these extras is separate from the standard costs associated with running your business. You can add to every guest’s ACV without building more costs into your business model. As these additionals are optional, you will only experience outlay once they are selected by your guests. Providing you are making a profit on each optional extra then this the perfect way to increase your ACV and maximise your profit without great risk to your business.

This practice is done everywhere because it works. From optional extras with a new car to an extended warranty on a computer, the incentive for businesses to increase customer spend rather than increasing the number of customers is an established practice. It is a key strategy in the quest to stay profitable and needs to be treated as carefully as your bottom line. In Kigo, you can see the exact statistics of how much revenue you are making for every available night, across all of your properties, meaning your ACV can always be at the forefront of your mind.

What strategies do you use to increase your ACV?

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Understanding the History, and Changing the Future of VR Regulation.

What Can We Learn From London, San Francisco, Barcelona and New York?

What is the biggest concern for vacation rental property managers? Regulation. Even minor changes in the law can have a destructive impact on the potential revenue of any vacation rental business. And, as the vacation rental industry is undergoing a period of intense growth and change there has never been more pressure on authorities to put in the right regulation. Cities have the power to dictate their own rules and regulations so your business prospects can vary hugely, even within the same country. It is more important than ever to learn about the current laws, and what is likely to happen next in your community.

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 This means not only checking and complying with law and regulation, but also finding out how to become a voice in the development and refinement of these restrictions. To do this, we’re looking at four examples of how cities have debated, applied and structured vacation rental regulation. Using the example of how hotel regulation has been applied, we’re going to look at why there is a need for regulation of short-term rentals.

 We’ll also be talking about what you can do as an individual to make your voice heard amongst the noise and what seems like mounting pressure to legislate against short-term vacation rentals. This post will give you real evidence that you can use to argue your case about the economic, touristic and social benefits that a bustling and competitive vacation rental industry provides. Finally, we’re going to look at what’s next for the cities that remain undecided.

  How San Francisco, London, Barcelona and New York Set The Benchmark

 There has been a problem that the vacation rental industry sprung up quicker than we could measure its impact. Regulation had to be put in place that was based more on anecdotal evidence than fact. This lead to concerns from major travel businesses and disrupted residents being pitted against the financial success of a handful of individuals – the fight was always one sided, far more weighted toward those who opposed vacation rentals than those in favor.  We’re looking at the current regulation in major cities and what it means for the cities that are yet to apply their laws and regulation.

 San Francisco
San Francisco is the home of Airbnb and has been a focal point of American legislature. It is the cradle of the home sharing economy. On October 7th 2014 the city finalised its regulation, allowing short-term rentals of less than 30 days to continue. However, there are some restrictions. You be a permanent resident of the city, only rent out your property for 90 days of the year, pay 14% hotel tax and have $500,000 worth of liability insurance. The penalties for not complying with these rules can be as much as $1000 a day.

 London
With 23000 short term rentals already said to be operating in London, their regulation seems to be coming quite late. In a similar move to San Francisco, Londoners can now rent out their primary residence for 90 days of the year. The move was viewed as a victory for short term rentals but for professional hosts with numerous properties in the city, it was a real blow to their potential yearly revenue.

 What is notable in the restrictions in London and San Francisco is that there is no distinction made between home sharing and professional vacation rental properties. HomeAway even appealed the ruling in San Francisco, describing it as unfavorably weighted towards Airbnb and its users. It was not successful and the law still stands.

 Barcelona
In Barcelona, property owners are legally allowed to rent out their property for short term rentals providing that they acquire a tourist license from the local council after an inspection and paying the required fees. However, the city has suspended the issue of new licences in the city, effectively ending the possibilities for any property that does not already have a much sought after licence. This is good news if you have licensed property in the city as it has effectively closed competition for you. However, flats that are rented out without this licence are not uncommon. Barcelona’s efforts to control the impact of mass tourism are well documented and can be applauded as an effort to focus on the needs of the residents but with new hotels cropping up frequently, it is not hard to see where the loyalty of the authorities lie.

 New York
The law in New York is different again, and it’s even more complicated. It varies from building to building, banning rentals of less than 30 days in Class A buildings, which are multi-unit developments. All rent controlled and rent stabilized apartments are out, too. You can check the eligibility of your building on their website:

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 According to the Attorney General of the state of New York, as of 2014, 72% of available rentals violated the laws.

 What the examples show here is that regulation is being formed by various motives:

  • There is the desire to protect tourists and guests from low quality or unsafe properties
  • To collect the rightful taxes
  • Protect the customer base of the powerful hotel industry
  • Ensure there is available and affordable housing for long-term residents


 To choose just one of these end goals would be easy to regulate for, but to ensure standards and enforce taxation you have to allow rentals, meaning the hotel industry is angry and local residents may complain about being squeezed out by rising rents. To prohibit means to effectively create a new criminal industry that has no enforceable standards or safety and no collectable tax base, bar the amount in fines that authorities are able to collect from prosecuted offenders. There is not yet one solution that covers all four of these goals.

 The tax from New York alone makes a powerful argument for permitting official, regulated vacation rentals in the city.

NYC Tax

 The vacation rental industry provides a service that immensely popular with the consumer, has a real economic impact in terms of taxes collected and on a smaller scale for the hosts that are able to earn an income. With regulation, governments have a difficult choice to make because there are real advantages for a lot of people in allowing short term rentals to continue.

This leads us onto the next point, the people that WANT regulation.

 Why Hotels Want Regulation

“We are not against competition per se, just distorted competition,” says Alexandre Loisnard-Goyeau of the hoteliers’ union Synhorcat. “The distortion comes because on our side we have all the taxes and the legal obligations concerning security and access for the disabled and so on. And the flat-owners have none of it.”

Hotel companies are some of the biggest advocates of regulation for vacation rentals. They see them as having an unfair advantage over the same customers in an uneven marketplace. And it is true that there far more restrictions for the owner of hotels. They must have fire safety, disabled access and face regular inspections. Hotels cannot even choose the guests they allow, they must provide shelter to any guest if they have it to offer.

 Having to adhere to these regulations is an expensive business and is undoubtedly why hotel accommodation is frequently more expensive than comparable vacation rental properties. Where regulation is split is, whether to attempt to ban, or attempt to make vacation rental properties adhere to the same standards as hotels.

  Success Stories and Examples

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So what can you say? How can you defend the interests of property managers that extend past the profits of your own business? If you’re going to have a voice in the debate regarding the regulation of vacation rentals then you need to come correct and have information that can refute the concerns of the people trying to legislate the industry out of existence.

 There is nothing more persuasive than facts and proven figures. To quote from the HomeAway study into the economic  impact of UK vacation rentals:

The holiday rental sector plays a growing role in the UK’s wider tourism economy…Owners of holiday rental properties in the UK received gross income of around £950 million in 2014 and spent about half that amount on expenses related to the property—including £120 million employing staff, creating about 6,000 jobs. They paid approximately £100 million in tax on their holiday-rental businesses.

 This is a dramatic boost to local and national economies.

 As well as cold, hard figures there are human stories to consider too. Airbnbnyc.com has taken the step to collect real stories from people that have benefited from becoming property managers, even at a small scale. It shows how people have managed to keep their homes, start their own businesses and contribute to the economic base of their city.

And, it is not just property managers and local governments that are benefiting – many city regulations are ignoring the voice of the consumer. With 23000 listings in London all finding sufficient demand to operate before it was even legal, the lack of regulation of vacation rental is not something that is putting of a large section of consumers. As a product, people enjoy being able to local neighbourhoods and avoid the tourist hotspots that many inner city hotels are confined to.

 So, if we understand that allowing regulated vacation rentals has benefits for owners, provides more options for tourists and travellers and adds significantly to the local economy then we are just left with the issue of vacation rentals offering unfair competition to existing accommodation options. Something we have said before is that vacation rentals are not hotels. Whilst there may be some overlap between their target customers, they are different industries and can co-exist.

To use information from Airbnb’s study into their economic impact we see that the conflict in terms of customers and territory is not as large as one might think:

Airbnb impact

This report offers the idea that allowing short term rentals is not the same as simply taking guests from the rooms of existing hotels. It argues that it diffuses guests around new areas of the city, reducing the social impact of mass tourism in hotspots and more evenly distributing the economic advantages that come with it.

At this point, you may rightly say that this information is vague and it is in the interests of Airbnb to promote the information that shows them, and other short term rentals, in a positive light. So, for a more empirical approach we looked to The Rise of the Sharing Economy: Estimating the Impact of Airbnb on the Hotel Industry by Georgios Zervas,Davide Proserpio and John W. Byers of Boston University. This report studied data from Airbnb in Austin,Texas between 2008 and 2014, it then compared this with statistics from 4000 hotels in the area, dating back to as early as 2003.

 What they discovered in Texas was that for every 10% growth in short term rentals resulted in a 0.35% reduction in hotel revenue.

 So, there is an impact. It does affect the hotels in a negative way. But, a 0.35% reduction in revenue, not net profits, revenue – is just not that much. It shows that the overlap between the customers of hotels and short term rentals is not as great as you might imagine. The vacation rental industry could expand and plateau in Texas whilst only contributing to a single-figure drop in hotel revenue. If this was any other industry, would we be as concerned about the effect a new and effective business model was having? When email scythed through the business model of the post office, did it stop anyone? Because the positives were so clear, we continued and simply told the post office to diversify.

Now we have more facts and information about the regulation of short term rentals – what can you do with this? Can you make anyone change their minds? Well, we think you can:

What VR Managers Can Do to Change the Law

 One of the first steps that property managers need to take is to separate themselves from the general idea of homesharing, or as landlords. They needs to be seen as a professional group that offers a valued, worthwhile and popular service. As HomeAway’s response in San Francisco showed, there is a sense of frustration amongst property managers in regard to being viewed as homesharers that all operate under the familiar Airbnb-style business model. The state of New York Attorney General’ report into short term rentals in the city was even called ‘Airbnb in the City’.

 Contact your Representative
They are here to serve you. Contact your MP, your counsellor, your congress representative and make your voice heard. The opponents to the vacation rental industry already have their ear so you need to make your side heard.

 Create Petitions

NYC take action

This is an example of the New York campaign to ease vacation rental regulation. Another petition by the group Peers to legalise short term rentals in New York has over 234 000 signatures. Numbers like these cannot be ignored by the decision makers.

 Form Lobby groups
Demonstrate that you are not alone. Collect other professional hosts and challenge what you think is wrong about VR regulation. A group in Venice Beach managed to overturn potential regulation by doing exactly this. This is a tangible result from a group of business owners and concerned individuals. At times, you may feel powerless against the immoveable, slow machine that brings in regulation but there are property managers that have managed to have a real influence, even in the notoriously strict boroughs of Los Angeles.

 Write to the media
Nothing can cause change faster than negative press. If you can add weight to the voice of vacation rentals having a positive impact in your community then people will want to hear. It is a divisive topic that the media have taken a great interest in, but they will not contact you. You will have to reach out first in order to add your story to the debate.

 This process will be slow and may not ever get you the results you want. Even the litigious might of HomeAway was swept aside when appealing the San Francisco ruling. But, it can be a start. Voicing opposition is the first step to affecting the changes that are set to shape the industry in the upcoming years.

 Future Predictions

What’s clear is that most major cities and tourist destinations are going to bring in regulation and it is not likely to favor professional property managers. The most common form of regulation we found is a limited amount of home sharing being permitted, providing it is the owner’s primary residence and it is not for longer than 90 days of the year. This favors part-time renters, using the ‘Airbnb Model’ of short term rentals.

 Regulation can have the effect of forcing hosts underground, continuing to operate whilst trying to avoid the fines and punishments from the city authority. Also, some managers will always continue to circumvent the restrictions as the laws have been found to be difficult to enforce and the punishment for breaking them varying hugely. This means that some form of acceptance and regulation is going to help create serious, professional hosts that run their business full time, contribute taxes and maintain high standards of quality. The current system where anyone can decide to rent property when they feel like it breeds inconsistency and lower overall standards.

 In order to get results that vacation rental manages want, property managers need to make themselves heard. They need to show that their businesses do not offer substandard or inconsistent flop houses, designed to turn a black market profit. They are legitimate businesses that are providing tourists and other travellers with a real alternative to expensive monopoly of inner-city hotel accommodation.

 We think that city authorities cannot ignore the benefits that the vacation rental industry can bring to their cities in tax, tourist income and more financially stable residents.

 To be fair and effective regulation is going to have to:

1: Address Standards – Ensure all properties adhere to certain standards of habitability

2: Address Safety – Fire safety and evacuation processes

3: Punish offenders of regulation – Remove the right to host for repeat offenders

4: Control the distribution of tourism – Identify areas where residents are negatively impacted and reduce the amount of available properties. Have more properties available in areas undergoing regeneration

 Currently, major city regulation is not doing this. The laws regarding vacation rental restrictions only cover a small part of the industry and cannot yet claim to understand the true impact, positive or otherwise, of legal but controlled short term rentals. If you are concerned about regulation in your area, become active and add to the information being distributed.

 What existing regulation has not accounted for is that professional hosts are regulated by the consumer. As the industry grew in such a hothoused environment, professional hosts were forced to apply high quality standards and safety precautions in order to ensure repeat business from customers with a lot of choice. The vacation rental industry may have inconsistencies and varying standards but professional hosts want to be given the opportunity to demonstrate that theirs is a quality service that is much sought after. Hosts do not fear that regulation will show up poor standards, they fear that authorities will do too much to maintain the status quo of the travel industry and stifle one of the most exciting travel prospects in decades.

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