Lodgify CEO Dennis Klett was recently invited to speak on Fewo Helden, the longest-running German podcast dedicated to vacation rentals. Klett joined podcast host Annika Rathje to discuss, among other things, a topic that’s on everyone’s mind at this time of year: the future of the vacation rental industry.
While our German readers can check out the podcast, we wanted to share Klett’s top predictions here for everyone else. And we’ll give you a hint: 2024 success in managing vacation rentals comes down to letting go of the reins.
Putting technology to work with dynamic pricing
Yes, you heard that right: Klett maintains that hosts and property managers can do best by stepping back.
Of course, that means someone—or something—else needs to step up. And as you’ve probably guessed, in this case it’s technology.
Specifically, Lodgify’s CEO called out dynamic pricing as an indispensable innovation.
Dynamic pricing is a pricing strategy that uses algorithms to calculate and adjust prices in real time. Using dynamic pricing, you can optimize your rates to boost bookings and increase your profit margins.
Let’s face it: Knowing the exact best price for your rental at any given time is all but impossible. Even if you’re able to determine a near optimal rate, the process requires tedious calculations, a lot of manual work, and—of course—your precious time. And because the optimal rate is always changing based on factors such as competition, season, and more, your work never ends.
This is simply a task that a computer can handle better than we can.
But before you throw away your calculator, Klett stresses the importance of fully understanding any technology you’re considering before you opt in. Customers aren’t always aware of the best option out there or don’t use a software’s functions to their full extent. So doing your research pays off.
AI: from chats to checkouts
Artificial intelligence (AI) took off in 2023, so it’s no surprise that it will continue to grow in the coming months. But while we’ve grown used to AI hacks such as using ChatGPT to generate listing descriptions, Klett foresees even greater disruption.
In fact, Lodgify’s CEO predicts that AI will impact the market in general as well as the very distribution channels we use.
As Klett puts it:
“If I have a travel assistant who knows me better than I know myself, why do I still need booking portals?”
That’s not to say that booking portals will disappear. But the fact that AI is capable of creating user interfaces means that this is a question worth asking—and that we should all be ready for possible changes.
Once again, Klett stresses that it comes down to not being afraid to let go of what you know and try new things. Those who hold onto the “tried and true” methods for fear of the unknown may quickly find themselves behind the times.
Where does that leave hosts and property managers?
So, remaining competitive requires relinquishing control to technology. But what does that mean for the hosts and property managers who used to do a lot of this work manually?
The good news: technology isn’t stealing anyone’s job. Like has been the case in so many industries, automation is rather freeing up PMs’ time so they can focus on what machines can’t: the human component.
When PMs aren’t caught up in time-consuming manual tasks, they can devote themselves to bigger-picture concerns—such as finding the next innovations that can help simplify their jobs and maximize revenue.
For example, property management software (PMS) has become a necessity to help property managers streamline their operations, automate tasks, and generally save time. Meanwhile, PMs can focus on questions such as, for instance, how to increase direct bookings.
Which brings us to our final tips.
Final tips for vacation rental success
Lodgify’s CEO, Dennis Klett, wrapped up the podcast with some final tips for hosts and property managers to make the most of 2024.
His most important recommendation: to create your own website for direct bookings.
While many people are put off by the imagined complexity of the undertaking, it doesn’t have to be complicated. In fact, you can create a complete website in under an hour with Lodgify’s website builder.
Nevertheless, Klett doesn’t underestimate the importance of booking portals and diversifying your revenue streams. Instead, he stressed the necessity of staying on top of the newest channels, such as Google Vacation Rentals.
Simply by listing their properties on Google Vacation Rentals, hosts can expect more direct bookings in 2024.
And Klett’s all-around advice moving forward? That’s right, it comes down to “trying things out and being open to new things.”
On that note, have you tried Lodgify yet? As 2024 ramps up, now is the perfect time to set your business up for success with the tools that will help you put these insights into action.
