Kigo Blog

PVO : Finding the Fridge For The VR Industry

We are simple creatures. The more we see things, the more likely we are to use them. The problem is how to get your product in front of the people that want to see it? When you have a website, social media platforms and adverts, it might feel as if you are doing everything you can to get your product out there. But perhaps there is a cerebral side-step than can be done. Vacation rental managers can try lateral thinking and product view optimisation to see if it is possible to revolutionise their exposure.

A long time ago, astute marketers found out that the fridge is opened twice as often as cupboards. Anything in the fridge is going to be seen more. The trickle-down effect of this is that it is used more, and eventually bought more. So, how did these marketers get their products in front of their customers twice as often? With just three words of copy: ‘Refrigerate after opening’.

This was an inspired moment that cost nothing, did not change the product or increase the advertising. It just put the product in the most prominent position possible.

Brands and businesses that make it into common consciousness do not do so by accident. They conduct meticulous research into eye line trajectory and product placement. The characters on children’s cereal may seem harmless, but their eyes are designed to meet those of children. Eye contact from these characters increased trust by 16% so the eyes are angled down 9.6 degrees to create with eye contact with the children in the aisles. These techniques are not just reserved for impressionable children. Adult cereal is placed higher and the eyes on these boxes stare straight out.

This technique is called product view optimisation (PVO). It is all about increasing the amount of times your product is seen and the effectiveness of these views. So how do you apply this process to vacation rentals? Where is the fridge for our industry? Should you develop a company mascot with hypnotic snake eyes?

They'rrrrrreee Great! Perhaps not.

 The idea behind PVO is that people will see your product at times when they are not actively looking for it. You have to consider your product as something that people want, but don’t know that they want it at that time. Product view optimisation is basically similar to the principles of SEO. You put your business in the position where most people are likely to see it. SEO lets your business sit at the very top of online searches. PVO puts your business in front of people in the offline world.

An example of how non-traditional marketing and PVO could be used for vacation rentals is to sign up your property as a film or TV location. This means that production companies will hire your property to film in. It could be for adverts, educational shorts or even blockbuster films. What this does is three-fold. Firstly, it brings you revenue from the production company that will not be as seasonal as your regular guests. Secondly, it puts your property in front of thousands of people that may never see your normal advertising. Whilst this is not advertising, it puts your product in a prominent position. Companies pay exorbitant amounts to place their products into popular culture. Finally, you then have the option to market your property as a location from whatever it was in. Holidays based around visiting the locations of TV programs like Game Of Thrones or films like Lord Of The Rings have soared in the last decade. Imagine how many people would see your property, and then the boost in bookings you would have if people could stay at one of the locations from a major part of popular culture!

This is just one example of alternative marketing and PVO. It can require lateral thinking to develop an innovative and original way to implement PVO but having vacation rentals being seen and being noticed offline, as well as online will be of great help to the growth of the industry and your business.

Have you considered any other strategies to get your properties and your business seen by the mass market?

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Interactive Maps: A Quick Way To Arrive At More Bookings

Today’s blog is all about a quick feature that you can add to your site today that will help you convert more visitors to your site into bookings. This is the simple addition of an interactive map on your website. An interactive map is one that shows the local area as normal, but that you can add the location of your property and places that your guests might be interested in. From there you can see the proximity, read reviews and check the distances and times between attractions all whilst keeping customers on your site.

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 If you guest selects a property you can feature the location on an interactive map on the page for that property. As well as showing the property that has been selected, your interactive map can also show the locations of other available properties in the area. So, if the property is booked people on your site can choose available properties that are closest to their original desired location. You can even have the price of the properties on the map, and photos with a short description when your guests hover over the points on the map. This prevents people from leaving your site to start a new search based on the area they want to stay. Rather than having to search through the pages for different vacation rentals on your site, or possibly leaving your site, they move on to the next best property in just one click.

 A map that shows all the properties in the area can then be distilled to a map showing just the selected property. This would then feature highlights of the local area. Local restaurants, museums and bars can all have pins that lead straight through to reviews, their own websites and contact information. The same goes for tourist attractions. An interactive map can then show the best routes to get around these attractions either by walking, driving or on public transport. You can then have blog posts about the places on your map. Showing your knowledge and passion about your local area will bring this to life and engage the people that come to your site. You’re turning your site into a complete and definitive resource for people looking to book a holiday. You already have your property listings set up, but now you have all the information that people need to make the leap from research and comparison to an actual booking.

 We’ve spoken before about how a good vacation rental website not only provides all of the information that your guests will want to know, but taps into the anticipation of the holiday that they are planning. You should show your guests what they can do when staying in your property. Show the local knowledge you have amassed and give them an insight into the area they are hoping to stay in. You are allowing people to visualise their holiday, making it more real, and leading to more bookings from first-time visitors to your site.

Using tools like Google Street View and reading reviews can all help this but being able to see everything on the same page, whilst they are considering their booking means you are in a great position to convert that visitor into a booking right there and then. Showing your local knowledge and your commitment to ensuring every guest’s enjoyment of your property helps to show that yours is a business that can be trusted.

And, if you are using a Kigo website template, you can simply add your properties and the attractions in your local area to the back office and they will automatically be added to your interactive map. It is one of those smaller features that helps professional and innovative hosts stay ahead of the competition. Click here to find out more about this feature.

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What Does The ‘Sharing Economy’ Mean to You?

How This Catch-All Term Could Be Damaging Your Business

It’s a term that gets used a lot these days. Newspapers love it, politicians are discussing it, and as a vacation rental owner some people consider you a part of it. But do you consider yourself as part of the ‘Sharing Economy’? Or is yours just another business that simply sells space to the public at a profit? Could describing all vacation rentals as part of this sharing economy, be not just inaccurate, but damaging to the future development of the industry of dedicated hosts?

Calculating Taxes Up And Down
The problem is that there is still a suspicion that the sharing economy is a fad, unlikely to escape from the ‘small time’ mentality. The businesses themselves have attracted huge investment and valuations, but the people providing the service are doing this on an amateur level. This is still a sense that by using services in the sharing economy you are taking a chance. You are entrusting a service to a person with no formal training, qualifications or requirements. This is not the case with vacation rentals. Professional owners and managers need to be dedicated and professional in order to survive.  Negative implications of being part of the sharing economy stem from the businesses being viewed by some as a cottage industry – less legitimate and regulated than established businesses. There is an implicit suggestion of being ‘small-time’.

 Is the sharing economy part of the problem that vacation rentals are having in the battle to emerge as a permanent business force? Should professional, full-time hosts be distancing themselves from the idea of the sharing economy and focusing on doing more to establish professional hosts as a sector of their own?

 Airbnb is one of the biggest businesses in the sharing economy and an important part of many hosts’ revenue. Whilst many hosts may use Airbnb to host their properties, more full-time vacation rental managers may not consider themselves to be part of the peer-to-peer economy. To many, sharing sites are just a good platform to host their properties and reach their guests. Their business models operate in a more traditional way, and whilst they can be similar, they are not just a newer version of existing sites like Airbnb that people may consider them to be.

 Speaking in a Fortune interview the CEO of HomeAway describes how vacation rentals do not necessarily fit into the sharing economy.

 To hear Sharples explain it, HomeAway [couldn’t be more different from sharing economy businesses]. His company caters to people wealthy enough to own a second home. The other guys are catering to scrappers who are so hard up they offer a room in their home to strangers.

HomeAway are also backing this up with a $100 million marketing budget that aims to define the difference between apartments that are part of the sharing economy and the exact service that HomeAway provide. And this is not a small site, HomeAway is a giant in the industry and it still feels the need to be even clearer about how their business operates.

But as well as having certain negative connotations, such as being unregulated and inconsistent, being considered part of this movement does have some advantages. There’s plenty of information about how the sharing economy benefits the people nearest the bottom of the economy and has less of an impact on the environment than traditional holiday accommodation. There is a sense that the sharing economy is the opposite of corporate big business and are more ethical in the way that they do business and how their business distributes money around the community.The paper titled: The Rise of the Sharing Economy: Estimating the Impact of Airbnb on the Hotel Industry explains further:

Clearly, there exist beneficial transactions enabled through the sharing economy… that provide positive utility, have no negative externalities, and thus manifest themselves as a net gain in social welfare.

Airbnb have also commissioned reports into their economic impact in nine cities and it is almost impossible to overstate the positive effect they have had on bringing vacation rentals into the public eye. They are one of the true success stories of the sharing economy and a vital portal for many full time vacation rental businesses, but is covering all vacation rentals with this term damaging the public image of some businesses that do not fit in it? As we have seen from HomeAway’s PR and new marketing campaign there are businesses that are separating themselves from the idea of the sharing economy.

And whilst there may be signs of division growing, all of this is good news. As the industry expands, businesses are now defining themselves in clear ways and not all of them fit in the popular example of the sharing economy. This is a sign that vacation rentals are becoming established as a permanent force, as different branches and brands separate from each other and are still strong enough to survive. Vacation rentals do not have to operate in the same way and businesses are starting to separate themselves from images that don’t describe them correctly.

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Part 2: Is Reviewing Your Guests a Recipe For Disaster?

This is part 2 of this post, click here to read part 1!
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If we look at the criteria or established and successful guides to hotels and restaurants such as Zagats or the Michelin board, they are uniform and measurable. The rating scale for Zagat is made up of 30 points and hundreds of reviews are used to create an average score that also comes with carefully curated and edited, insightful comments. The Michelin guide is the zenith of reviews and its system has an unparalleled focus on quality over quantity. A New Yorker article sheds some light on their clandestine process:

 Michelin has gone to extraordinary lengths to maintain the anonymity of its inspectors. Many of the company’s top executives have never met an inspector; inspectors themselves are advised not to disclose their line of work, even to their parents (who might be tempted to boast about it); and, in all the years that it has been putting out the guide, Michelin has refused to allow its inspectors to speak to journalists. The inspectors write reports that are distilled, in annual “stars meetings” at the guide’s various national offices, into the ranking of three stars, two stars, or one star—or no stars. (Establishments that Michelin deems unworthy of a visit are not included in the guide)

As mentioned earlier, 70% of us trust Internet reviews, but when you understand the process of how the most trusted reviewing industry go about creating their reviews it seems untoward that every single guest has that much control over your reputation. Could the vacation rental industry benefit from the type of review analysis that these guides undertake before publishing?

 The other problem is that a 100% review rate means that the focal point shifts to pleasing everybody, as opposed to creating a product or service that is the best you can make it, but may not be to everyone’s taste. A blander, more universal palatable experience eventually emerges.Leading to the acceptance of everyone, but to the delight of nobody.

Is an abundance of reviews causing hotels or holiday accommodation to establish a culture of mediocrity that is rewarded by top reviews? This is not just a hark back to the ‘good old days’, there are real and measurable negative effects of implementing a two-way review system. A recent white paper called A First Look at Online Reputation on Airbnb, Where Every Stay is Above Average has elucidated the impact of a two-way reviewing system. One of the first points they mention is that,

Nearly 95% of Airbnb properties boast an average user-generated rating of either 4.5 or 5 stars (the maximum); virtually none have less than a 3.5 star rating. We contrast this with the ratings of approximately half a million hotels worldwide that we collected on TripAdvisor, where there is a much lower average rating of 3.8 stars

 The system of 2-way reviewing means that people are more disposed to reviewing favorably because all reviewers are subject to the same scrutiny. Reviews are also subject to more factors that distort the truth of them. There are 4 factors outlined in the review that demonstrate how online reviews can be altered by the nature of how the information is collected.
  
  • Herding behavior, whereby prior ratings subtly bias the evaluations of subsequent reviewers
  • Under-reporting of negative reviews, where reviewers fear retaliatory negative reviews on platforms that allow and encourage two-sided reviewing
  • Self-selection, where consumers who are a priori more likely to be satisfied with a product are also more likely to purchase and review it
  • Strategic manipulation of reviews, typically undertaken by firms who seek to artificially inflate their online reputations
  Despite these concerns, over 70% of consumers report that they trust online reviews.

 So, not only does a reciprocal review system skew the results, even the traditional mode of reviewing vacation rentals provides results that cannot be entirely trusted. We have created a system whereby reviews are unevenly weighted towards the positive. We encourage every guest to review but have not set uniform parameters for what exactly these reviews mean.

 Having face to face interactions, such as guests and hosts meeting, leaves us disposed to leave a positive review. Airbnb are implementing natural language processing software in order to filter out the true meaning from these ‘rose-tinted’ reviews. What this shows us is that not only are there issues with the way we are currently reviewing properties, but that a major site such as Airbnb consider it serious enough to be trying to tackle it.

 Would a system of 2-way reviews give you confidence in who you are renting to, or would make each party overly suspicious of anyone that falls under 4 or 5 stars for whatever reason? Surely any manager would like to know if a potential guest has been violent at a property before or caused damage? Increasing the safety would certainly be a positive effect, but would it not just constrain guest and host into a false bonhomie? Rictus grins never slipping, until it leads to a pleasantness attrition where both sides have the same capabilities to destroy each other via review rather than mentioning any issues either party may have at the time?

 It is the erosion of the human connection that causes concern, and even if this connection is based on dissatisfaction. It allows you to avoid confronting what you consider to be unacceptable, safe in the knowledge that you can exert your power on the situation via review, anonymous and protected. This removes the impetus to change.

 So, is it better that to operate in an industry that could be safer, but is more saccharine and sickly? Where niceties are forced out under the threat of a bad review? Or to operate where there is more chance, more variation? Where you don’t know what to expect from your guests but then there is mystery, discovery and what you experience is real? This is not to say that having a large number of reviews will not help your bookings and help your SEO rankings. You do still need numerous reviews. This is simply a comment on the effect that reviews could have on the industry and the possible problems of implementing a widespread two-way review system.

 Would it bother you if the impetus to forge a civil relationship is based on the fear of a negative review or do think that the derivation and motivation is not a concern when the result is a safer, more accountable and trustworthy industry?

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90 Days and 90 Nights

Vacation Rentals Limited to a Quarter of the Year by Regulation

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In Tuesday’s blog, we discussed how London is set to approve short-term rentals, and how hotels were attempting to block this. Today, we’re talking about just what the new law means for owners of vacation rental properties in London. London is to join San Francisco in permitting short-term vacation rentals, but for only 90 days out of the year. Ostensibly, the vacation rental industry just received a big boost. The industry has just been legalised and been given defined regulation. The question is, what will this mean for hosts in the city and what do you do with the other 275 days of the year?

Full-time hosts will be forced to rent their properties to more long term guests like students or business travellers for the rest of the year. Managers will have to choose the time of year when they want to use their properties for their vacation rental businesses. For many owners, 90 days, a quarter of the year is not enough.

It is important to consider that while this regulation has effectively only just legalised short term rentals, the industry was booming before this period. When it was basically illegal the industry still managed to thrive. Is this regulation a way to actually curtail short term rentals? The limits before were poorly defined and people used this to their advantage. The enforcement was sporadic and ineffective. Have governments realised that this might actually be a way to reduce short-term rentals in a real way?

 If you go from renting your property out for the entire year, to be forced to limit this to 90 days, it means that property owners will aim to get more revenue from these 90 days. This means that the high season could become ultra-expensive, with every professional host saving their quota of 90 days for the summer and public holidays. This, combined with part-time hosts renting out their properties whilst they are away over the summer means that there could be dramatic peaks and troughs in pricing of accommodation.

This means that one of the most attractive features of vacation rentals for guests, the low price, is likely to rise as every host has to capitalise on their 90 days of potential revenue. The gap in price between hotels and vacation rentals will be narrowed and the services and trusted brands of hotels mean they will be able to reclaim some guests. As mentioned in our previous blog post, opposition from the hotel industry has cited concerns over standards of safety and cleanliness and the impact of tourism on local residents as well as concern for their customer base.

So, how about a two-tier system? One that allows people to utilise their properties when they are not in them and another that recognises professional hosts. This second tier for professional owners would be more regulated, requiring licences and inspections to ensure quality and measured amounts of hosts in each area with licences being rescinded for violations. Could having well dispersed hosts that meet standards of quality, safety and social responsibility be a way to leaven the problem? Are professional host not going to be more invested in ensuring standards of safety and quality? If you had a set number of ‘host licenses’ in areas you could effectively regulate the industry and standardise quality whilst still allowing the population of the city to utilise their empty properties for the planned 90 days.

By allowing unregulated short-term rentals for 90 days, the London council is tacitly saying that short term rentals by homeowners do not compromise the ‘residential integrity’ of local areas. What it doesn’t limit is the amount permitted in one area, or the times when the properties can be rented. With the upcoming regulation, there is nothing to stop low-quality or unsafe rentals operating in a cluster, either close to residential areas or in established hotel territory. As well as being grouped together in terms of proximity, the 90 day regulation means that these properties are likely to be operating in a concentrated area and during a concentrated time period. This is being coupled with plans to continue adding 2000 extra hotel rooms to the current total every year until 2026.  Is this not a recipe to create effective tourist ‘ghettos’ the centres of cities like London during the most popular months?

These professional hosts are not the destructive force that they can be painted as. To use an example of San Francisco, having a similar regulation, the majority of hosts are renting out their only property. Professional hosts make up only a small part of the demographic.

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Actively promoting hotel growth and ignoring the population of full time hosts is not a complete solution. This 90 day regulation is unlikely to be the last amendment to London’s and other city’s rental regulations that we see.

 Would this regulation put you off expanding your business into these cities? Photo Credit