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It’s one of the hottest topics in the vacation rental industry right now, and it’s constantly up for debate: should I be accepting instant bookings? Am I missing out if I don’t?

While there are many arguments for and against both sides of the coin, lots of owners feel lost and confused, not knowing whether they’re doing the right thing.

In part one of our two-part series, we’ll dive into the pros and cons of instant booking. After all, only you can make the decision that suits your vacation rental.

What is instant booking?

Instantly bookable vacation rentals are those which don’t require any kind of approval from the host prior to booking. Guests simply choose their travel dates, agree to house rules and press the booking button for their payment to go through – just as they would with a hotel. It’s become an increasingly popular choice for owners and guests to choose instant booking. Above all, instant booking is more common with hosts on listing sites like Airbnb, Booking.com, FlipKey and so on.

So, what are the pros to using instant booking?

Increased conversion rates

Modern-day travelers are accustomed to everything being instantaneous. Think about it, they book their flights with the click of a button, they check-in their luggage with another. Booking accommodation isn’t any different, and it’s what a lot of travelers look for.

That’s why instant booking functions can play a big role in increasing booking conversion. With instant booking, owners are able to compete with hotels who have been using it for years, and guests will find the process just as easy and simple as booking a hotel room online.

Matthew Gurley from MyBookingPal shares his wisdom on instant booking conversion:

matthew-gurley“Property managers who convert to instant book see an influx in bookings, and generally have a lower cost of sale when it comes to acquiring a booking. You pay a staff member to answer dozens of inquiries hoping a portion of them convert, or pay a staff member to only spend time on customers that have already handed you a credit card to charge the deposit through an instant book. Choice is yours, but the second saves your time, and increases your revenue.”

Guests can’t get enough

No matter what the travel purpose, guests love the instant book feature. In booking your property, it is assumed that guests will have read and agreed to your property’s house rules.

Instant booking is convenient for them because there’s no waiting around for you to accept. That means they can go ahead and make the rest of their travel plans, knowing full well that accommodation is sorted. They can even filter results on sites like Airbnb to only show vacation rentals that allow instant booking!

Matthew Gurley adds:

“There is a huge importance of house rules or fine print for book-it-now websites. As long as you are not violating any local discrimination laws, line out your guest screening process in house rules or fine print. Let the guest book instantly. If they are breaking a single line item, just cancel with a refund. They’re breaking your rules, so there aren’t negative repercussions for cancellations in this case.”

Less bureaucracy

Hosts and guests alike can all take advantage of instant booking and its ability to cut hours and hours of admin time. With instant booking, the guest makes their reservation, then the only thing both hosts and guests need to worry about next is check-in.

instant-booking-pro-1 instant-book-pro-2Source: Airhostsforum

More direct bookings

Allowing instant bookings on your own vacation rental website helps you reach your end goal: more direct bookings. As a result, this will help build up your guest email database and you’ll be able to nurture past guests into return bookings. That’s because you’re not sending them anywhere else to book, or even giving them a reason to look elsewhere because you already have what they’re looking for!

Improved website credibility

Accepting online instant bookings and credit card payments gives your vacation rental website the edge over many of your competitors who don’t offer these services. The very nature of accepting online payments makes your site more professional, not to mention more reliable! Adding a security seal like VeriSign serves as social proof to your potential bookers, they’ll be assured that their sensitive data is safe with your website.

Listing sites prefer it

Many of the big listing sites like Airbnb and HomeAway openly admit their algorithms favor hosts with instant booking functionality, as they believe it’s a huge benefit for their users.

instant-book-pro-3Source: Airbnb

Not only can this preference be seen reflected in search results, whereby instantly bookable properties tend to show up first, but also in press releases and updates from the OTAs themselves.

instant-booking-pro-4Source: Skift

If you’re worried about attracting the wrong type of guests, however, do as PartySquasher recommends and ensure your listings require a verified ID, or even customize your requirements to include guests who have previously ranked 4-star and above in their reviews!

Never miss a booking

Allowing guests to book instantly is good news for both of you: they’ll get to book their dream vacation rental, and you’ll never miss out on bookings by responding too late! As long as you have instant booking activated, guests will be able to select your property for the dates they need and reserve immediately without waiting for your reply or confirmation.

Accept more last-minute bookings

If your property accepts instant bookings, you’ll open up a whole lot more options regarding the type of guests you attract. In particular, we’re talking about last-minute bookings. Whether that’s spontaneous out-of-season weekend trippers or someone who’s decided to stay longer in a city, your home could be the one they choose depending on this factor.

instant-booking-pro-5Source: Airhostsforum

But what about the cons of instant booking?

Decisions are out of your hands

One downside of accepting instant bookings is that there’s very little “screening” process in place to make sure guests are a good fit for your home. In fact, they are the ones that decide they’re suitable, as pressing instant book is, in itself, an acceptance of your house rules.

This can, however, reduce hosts own sense of security or peace of mind. Given that instant bookings are automatically accepted, can hosts really be certain the person coming to stay at their rental is really who they say they are?

On listing sites like Airbnb, however, you can usually set restrictions according to your preferences for instant booking candidates. For example, choose whether you’d like to host guests who Airbnb deem eligible for instant booking, or restrict this setting to only include guests who have received positive reviews or been recommended by other hosts.

Increase in cancellations

For some guests, instant booking is an easy way to bide their time (and not miss out on a room or place for certain dates) while making their decision, especially if the host has a flexible cancellation policy.

Whether your rules are flexible or super-strict, avoid receiving last-minute cancellations by clearly stating your cancellation and refund policy on your website or your listings so any potential bookers are aware what rules apply.

At the same time, a shift towards the promotion of instant bookings on listing sites may possibly lead to more cancellations from the host side, which could have a negative effect on listings.

instant-booking-con-1Source: community.airbnb.com

The blame’s on you

Hosts that use instant booking can be left in a tricky situation if they list on more than one platform, as any mistakes like double bookings are going to fall on your shoulders.

When you accept instant bookings on various portals, your different calendars require constant updating to block out those booked periods, which can easily become quite a handful and unfortunately, mistakes can be made.

instant-booking-con-2Source: Quora 

Having an up-to-date calendar across all your channels is essential for hosts to get the most bookings and least errors or cancellations. This can, however, easily be solved by using a channel manager which automatically updates all your reservations and calendar availability from one centralized place.

Difficult for beginners

For new hosts with little guest experience, instant booking can limit your opportunities for learning about guest expectations and as a result, lead you to receive more negative reviews. Knowing how to handle guests properly and professionally is key to building a good host profile, but accepting all guests with little changeover or management time can lead to big issues when it comes to their reviews of you. As it can take a while to get used to being on top of your calendars and processes, instant booking isn’t recommended for new hosts because having to cancel reservations is a big no-no for first timers.

So that’s it: the pros and cons of accepting instant booking for your vacation rental. Why not check out part two of the series, where we discuss the arguments for and against accepting booking requests!

proscons-booking-requests

What do you think about this post?
(3) Comments
  1. Lee Ingram Reply

    Having read most of this stream, mostly “pro instant booking”, I have the following comments.
    First, I am most familiar with VRBO (renting out our personal use condo when we are not using it…), so the first response from a Property Manager about how much easier for streamlining his property rentals is NOT my situation. I am a single location owner; I easily keep my response time less that 24 hours, and often less than 2 hours.
    Second, “assume guest reads your guidelines”…amongst these, we are smoke free, “including private patio and poolside”, which needs to be re-confirmed with my guest…also checkout time 10am (though I frequently can make allowance in discussion with my guest).
    Third, due to our unique beachside location, guests always have questions about how long it takes to walk to town..availability of taxi’s/bicycles…whether we have our bedding changed daily (we do not)…do we have 24 hour security presence (yes). Some minimal discussion is always helpful to both sides before a booking is comfortably made.
    Finally, have I missed out on some bookings where a guest may have made a commitment earlier than they were ready to? Yes. Does this bother me? NO. I’m in it to make some money (to offset expenses), NOT to make “the most money possible”. Mine is not a “business”.
    I’m hugely disappointed in the new VRBO and Airbnb models who are motivated by increasing company profit while riding rough shod over the old concept of providing website for home-owner and guest to meet. If VRBO continues to allow me to NOT allow instant booking, I easily accept that I may be diminishing my profits and losing an occaisional client. That’s my choice. “Choice” is what VRBO and Airbnb wish to remove to their increased profit models.

  2. Susan Wons Reply

    I agree with Lee. I have a lakefront cottage that is my only rental. I am on vacation home rentals, vrbo and now craigslist. vrbo is trying to push everyone into instant booking with the owner responding in 24hrs. Not only do I pay them to advertise but now they want to charge a booking fee to guests for instant booking. If I use their credit card service I am charged 2.9% of the total. No thank you. I just want an advertising forum, but of course I am pushed down the ladder in placement of advertising because of this. I prefer to communicate with potential guests from the get go. By the way I tried using vrbo’s book now feature for a place in Florida that appeared to be available on the calendar. I was instantly charged the booking fee on my charge and the owner had 24 hrs to accept my booking. Never heard from him and my booking expired. Lets see if vrbo reverses the charges as quickly. Plus I lost valuable time waiting for a confirmation in a time period when the market is very busy there. I do not like the book now feature as a property owner or a guest.

  3. Nick Marshall Reply

    Instant Booking would be marvellous if guests always abided by the house rules. Often they don’t even read them or, having read them, take the attitude of “Who is to know if I squeeze a few extra kids into the house or have a party?”

    The chances of getting the absolute guest from hell are, no doubt, quite small but the outcome of such a “Black Swan” can be horrendous & costly. Two examples:

    https://www.linkedin.com/pulse/bookingcom-vacation-rentals-nightmare-stefano-sessa
    http://observer.com/2017/03/airbnb-nda-damage-in-london-after-drug-party/

    Matthew Gurley’s wisdom about the hotel-like benefits of instant booking fail to point out the obvious fact that, unlike a hotel, a holiday home does not usually have resident staff to ensure that the guest does honour the house rules. In addition, the consequences of overbooking can be more easily managed by the simple solution of upgrading to a better room or putting the guest in another hotel.

    He makes it sound easy: “Let the guest book instantly. If they are breaking a single line item, just cancel with a refund. They’re breaking your rules, so there aren’t negative repercussions for cancellations in this case.”

    Apparently, this leads to “Peace of Mind” because “you can cancel penalty-free before or during a trip”. Two points here:

    The concept of penalty-free is a slippery one because you will never know how much your prominence on a listing site may suffer because you have cancelled a booking. To imagine that there will be no consequences is naive at best.
    Would it not be better to have that important conversation with your potential guest in which you find out enough about your guest to give you the confidence to ok the booking? At the same time, you make absolutely sure that your guest knows the rules. Our experience is that it is better to encourage the guest who intends to break the rules to go elsewhere rather than have to cancel later or go through the worst situation of asking a guest to leave.

    How many owners want to front up to a guest and ask them to leave halfway through their stay? Indeed, many owners would be worried about the potential whiny reviews they might receive and the inevitable back and forth with the listing site trying to establish the truth of what happened. Who needs that?

    Guests may love the idea of instant booking and want it but the reality is that the waiting period is a maximum of 24 hours but usually just a few hours.

    Less Bureaucracy – this is nonsense. Communicating with a guest is not the equivalent of a government department being high-handed. It is the establishment of a conversation with the family or group that is coming to stay in your home. Your home is probably your most valuable asset and you want to protect it and your immediate neighbours from guests who are only thinking of themselves. This conversation is an opportunity to establish a rapport with your customer. Done well, it can add to the whole guest experience.

    Real Estate agents do not have “Instant Leasing” for obvious reasons – they want first hand knowledge of the customer hoping to lease so they interview in person. The best a property manager can do is have a phone conversation with the potential guest. Even so, a phone conversation can tell you a lot more than a restricted email exchange.

    Of course this process is a little more time consuming than relying on the impersonal algorithm but this is a people business. The big listing sites are all about scale. People are not. People are families or friends who are going to stay in your home. People are also your neighbours who will have to suffer the side effects of short term renting if you do not take their interests into account as well.

    Who you let into your home is, undoubtedly, a tricky business. You can inadvertently run foul of the anti-discrimination laws. It is virtually impossible to refuse anyone when you have availability on the calendar. The best you can do is to be absolutely explicit about the rules and the consequences of breaking the rules. That is usually enough to ward off those who have no respect for you or others in your community.

    The risk of a double booking is far greater with instant booking if you are on several sites. I consider it completely unacceptable to bump a customer because of your inability to keep your calendars synchronised in real time.

    As far as I know, the sites like Xotelia and Bookingsync that offer calendar syncing are not instant because it depends on the cycle that each listing sites adopts to update their listings. So, even with syncing it is possible to be caught out. You are therefore taking a risk with other people’s money. An additional consequence is that a customer may immediately book non-refundable airline tickets on the strength of the accommodation booking. Unes that customer can find alternative accommodation you may be imposing a large financial cost on your customer.

    There is an element of madness to this pre-occupation with instant booking. According to research, most customers look at several sites and draw up a list of 7 or more properties. This takes time and is usually done several months before the time of travel. Yet we are being persuaded by large listing site promoters that it is essential. Essential for whom?

    The listing sites rarely have to deal with the consequences and, if they do, they are not exactly enthusiastic if the AirBnB host who had his apartment trashed is to be believed (see the Observer story above).

    The benefits outlined above appear to be another example of “privatise the benefits and socialize the costs”. The listing sites gain the benefits and the host, the customer and the neighbourhood carrying the cost when things go wrong.

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