The short-term rental industry is booming. From cosy cabins to chic city apartments, travellers are increasingly turning to Online Travel Agencies (OTAs) like Airbnb and Booking for unique and memorable stays. But for hosts, managing a successful short-term rental (STR) property goes beyond a charming listing.
In this complex landscape, technology plays a vital role. A well-chosen tech stack can streamline everything from guest communication and bookings to cleaning and maintenance. But with a vast array of solutions available, it can be overwhelming to know where to start.
This blog post will be your guide through the ever-growing Short-Term Rental Technology jungle. We'll explore its terminology and the key categories of technology every STR operator should consider.
Let's start with the basics: what is an STR?
STR stands for Short-Term Rental, a furnished home or apartment that is rented for a short period of time, usually less than 30 days.
They are often seen as an alternative to hotels and can be 25 to 50% cheaper. STRs can include entire homes, individual rooms, or additional living spaces, and some jurisdictions differentiate between single-family and multi-family homes.
Short-term rentals (STRs) are popular choices for vacations or relocations, provided by private owners and investors on platforms called OTAs, such as Airbnb and Booking, (and of which you'll learn more later on), and often feature amenities like fully-equipped kitchens, laundry facilities, and some even welcome pets.
Do you want to keep reading about STRs? Check our post "What is an STR?"!
A Property Management System (PMS) is a type of software that helps short-term rental owners and Channel Managers manage their business (More on that later).
PMS software automates tasks like guest communication, cleaning scheduling and staff, pricing adjustments, and it can also help with managing bookings, organizing maintenance staff, and handling payment processing.
PMS software is also known as Vacation Rental Software or Property Management Software.
To see in greater detail all the advantages that a Property Management System offers, we invite you to visit this article: What is a PMS?
A channel manager (CM) is a software tool that connects a property management system (PMS) to online platforms (OTAs), such as Booking.com or Airbnb, to automatically update rates, availability, and reservations.
This allows property managers to update multiple online booking sites at once, which can help prevent double bookings and make inventory management easier. Channel managers can also provide key performance reports that can help inform marketing and sales strategies.
Some benefits of using a channel manager include:
Revenue Managers (RMs) adjust rental prices based on factors like seasonality, local events, and market demand.
By utilizing Revenue Management techniques, property managers and STR owners can maximize occupancy rates by dynamically adjusting rental prices based on variables such as seasonality, local events, and market demand.
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In hospitality, PMS stands for Property Management System.
A hotel PMS is a software that helps hotels manage all aspects of their business operations, including guest experiences.
It automates many administrative tasks front office staff are responsible for, such as:
A hotel PMS can also store guest information, allow for special requests, and provide extenuating circumstances.
It can integrate payment processing into the booking and check-out process, and offer multiple payment options for guests.
Hotel PMS are considered the heart of a rental, and is essential for improving the guest experience and increasing efficiency.
In the hospitality industry, Point Solutions are specialized tools or software programs that focus on solving one specific challenge within a particular business sector.
These might range from room reservation systems and loyalty program software to recipe building platforms. While point solutions are highly effective for fulfilling that single purpose, businesses may find themselves having to invest in multiple point solutions should they face multiple challenges. This can be costly and time-consuming, creating a need for more comprehensive solutions that cater to all their business needs in one go.
Therefore, the challenge for the hospitality industry is to develop multi-faceted solutions that incorporate several point solutions and provide an efficient way to solve multiple challenges without having to invest in numerous individual products.
Point solutions offer a number of benefits that can be extremely beneficial to organizations:
Customer Relationship Management (CRM) systems help businesses manage customer data, sales, and communication, provide insights and integrate with social media.
These are the basic types of CRM systems:
Data aggregators in tourism are services that combine data from multiple sources into a single database.
This information can be used to create data repositories that can help with decision-making, marketing, and business performance.
Data aggregators can help the travel and hospitality industries with:
Digital Marketing in tourism is a cost-effective way to communicate with customers and visitors, and can help businesses grow.
This kind of marketing can help businesses:
Digital marketing in tourism uses a variety of strategies, including:
Digital marketing allows businesses to target specific groups of travellers based on their interests, demographics, and behaviours.
It also allows businesses to track their successes, such as who is engaging with their content, where they are from, and how long they spend online.
Some tips for digital marketing in tourism include:
Search engine optimization (SEO) in hospitality is the process of improving a hotel's website and STR listings ranking on search engines like Google, Firefox, Edge, Yahoo, and Bing.
The goal of SEO is to increase a hotel's or rental's online presence, drive website and listing traffic, and improve bookings.
SEO can help hotels:
Here are some tips for SEOing a hotel or rental website:
OTA stands for Online Travel Agency or Online Travel Agent.
It is a web-based marketplace that allows consumers to research and book travel products and services directly with travel suppliers.
OTAs act as intermediaries between travel inventory suppliers, such as, rentals, airlines, hotels, and tour operators, and connect providers across the travel industry to help travellers plan their trips. Travelers can often access package deals with accommodations and airfare on OTA sites.
Some examples of popular online travel agencies include: Booking.com and Airbnb.com.
Synonyms for OTA include Alternative Distribution System (ADS) and Internet Distribution System (IDS).
In the hospitality industry, a metasearch engine is a tool that collects information from multiple sources, like online travel agencies (OTAs), and displays it in a ranked list. This allows potential guests to compare options and make an informed choice.
Listing sites, also known as online business directories, are a vital tool for hospitality businesses to increase their visibility and reach potential customers.
Listings are public profiles that contain important business information, such as name, address, phone number, website, and hours of operation. They can help customers find a business online and in real life.
On Online Travel Agencies (OTAs)' websites, such as Airbnb.com and Booking.com, listings are essentially advertisements for short-term rentals posted by hosts. These rentals can be anything from private rooms in a homeowner's apartment to entire houses, cabins, or even unique spaces like boats or treehouses.
In hospitality, property acquisition is the process of gaining ownership or control of a hotel, rental or resort property.
This includes the transfer of real property, business, financial assets, and liabilities. The buyer of a rental or hotel also automatically takes over any existing lease agreement.
Hospitality REITs (Real Estate Investment Trusts) are another way to acquire hospitality properties. They focus on developing, acquiring, managing, or financing the construction of hotels, lodgings, and other hospitality properties.
Navigating hotel acquisitions requires a deep understanding of the hospitality industry and business acumen. This includes understanding employee contracts, union agreements, and staff benefits, which can have a significant impact on operational costs and flexibility.
The hotel and rental purchase and sales agreement (PSA) includes a due diligence period where the buyer reviews documents like financial data, property surveys, and environmental studies. The PSA also includes closing documents like a general warranty deed, bill of sale, and assignment documents.
In hospitality, Access Control Automation is a system that uses electronic locks and key readers to automatically open and close room doors, and record and store guest information digitally.
This system allows the staff to grant access to guest rooms, and track room access while ensuring guest security.
Access control automation can help hotels:
Property Automation in hospitality is the use of technology to automate hotel operations, such as managing information, controlling equipment, and performing tasks.
Automation can help hotels and rental owners become more efficient, save time and money, and improve the guest experience.
Some examples of automation in hospitality include:
Automation can benefit both hoteliers and guests by:
Automation in hospitality is not intended to replace human employees, but rather to augment their results.
Ancillary guest services in hospitality are additional services offered by rental owners and hotels to enhance a guest's stay and generate additional revenue.
Ancillary services can include:
Ancillary services can help cater to guest needs and preferences, and create memorable experiences that make the hotel or property stand out. For example, hotels can offer pre-booking options for tours, airport transfers, or spa appointments to make guests feel valued.
Some other ways hotels can generate ancillary revenue include:
A tech-enabled franchise in hospitality is a franchise that uses technology to streamline operations and build customer loyalty.
Technology can help franchisees in the hospitality industry with:
Technology can also help restaurant owners support their franchisees remotely, which can ensure brand consistency and operational excellence.
Digital marketing can also help attract customers to new locations, create personalized experiences, and build brand loyalty.
Some examples of tech-enabled hospitality include:
The hospitality industry is increasingly relying on technology, which is powered by online, mobile, cloud, IoT (Internet of Things), edge computing, augmented and virtual reality (AR/VR), and low code applications.
Access control hardware in hospitality can include electronic locks, key readers, and presence sensors.
These devices can automatically open doors when a key is passed, and can track room access and guest security. When a guest leaves a room, the system can detect when the door closes and change the room's status in management software.
Access control systems can be activated by physical devices, such as cards, remotes, or bracelets, or by recognizing biometric features, such as faces, fingerprints, or irises.
In hotels and modern rentals, universal readers are an essential part of access control systems, as they can accept a variety of identification mediums, including RFID key cards and mobile credentials.
Access control systems can provide many advantages, including:
RFID stands for Radio Frequency Identification and is a contactless technology that allows guests to enter their rooms by waving a card in front of a lock.
RFID cards are a newer technology in the hospitality industry and are considered the new standard in hotel room and rental security.
RFID cards use radio waves to communicate with the card system, so guests don't need to touch the card or swipe it. When the card is close to the door, the electronic reader inside the lock uses a radio signal to power the card and send its chip serial number back to the reader for identification. The reader usually beeps and the lock light turns green to indicate that the card has been read.
RFID key cards are compatible with a variety of locking systems, but keep in mind that they can be expensive to set up, easily lost, or left in rooms.
A hospitality guidebook is a resource that provides information to guests about a hospitality business.
A guidebook can include information about the business's amenities, policies, and best practices.
It can also answer common questions from guests, and help businesses stand out from competitors.
Here are some examples of hospitality guidebooks:
Service optimization in hospitality is the process of using technology to improve operations and personalize experiences for guests. This can help hotels increase guest satisfaction and operational efficiency.
Here are some key aspects of Service Optimization in hospitality:
Some examples of Service Optimization tools and techniques include:
Overall, Service Optimization in hospitality is about using data and technology to create a win-win situation for both guests and hotels: a more efficient operation for the hotel and a more enjoyable and personalized experience for the guest.
Know Your Costumer or Know Your Client (KYC) in hospitality is an operations system that combines a hotel's central Hotel Management System (HMS) with over 25 external applications.
The system centralizes a hotel's operations, including guest communications, housekeeping, engineering, concierge, and security. KYC Hospitality uses artificial intelligence and big data to help hotels manage their guests.
It's a process for verifying a customer's identity and a mandatory process in the hospitality industry to ensure safe customer onboarding practices. Methods for verifying a customer's identity include ID paper upload, face recognition, and electronic ID verification.
For example, the Blockpass Mobile App allows users to instantly prove their identity while keeping their data secure. Users can use the app to verify passports, driving licenses, or other documentation that hospitality services may require.
Guest verification in hospitality is a process that businesses use to assess the risk of a guest booking a property. It's a standard practice in the hospitality industry that helps ensure the safety and security of both guests and hosts.
Guest verification can help prevent risks such as:
It can also help build trust between guests and hosts by providing both parties with the peace of mind that they are dealing with legitimate individuals.
Guest verification can involve requesting identification documents, such as passports or driver's licenses, and cross-referencing them with reservation details.
Another method is to ask guests to upload their ID and then take a selfie or selfie video to prove they are the same person. An algorithm or human expert will then assess if it is a match.
Automated Identity Verification Technology, also known as Document Readers, can help staff to verify guests' identity documents and determine if they are genuine or not.
However, guest verification can add complexity and friction to the check-in process, leading to longer waiting times, guest dissatisfaction, and ultimately lower revenue per available room.
Hospitality Insurance is a type of insurance policy that protects businesses in the hospitality industry from risks and liabilities.
It's designed to address the unique challenges faced by hotels, restaurants, and other similar businesses.
Hospitality insurance policies can help cover costs in the event of an accident, loss, or damage. They can also cover legal costs if a customer or employee becomes hurt or unwell on the business's property.
Some common risks in the hospitality industry include: food-borne illnesses, accidents, property damage, and customer dissatisfaction.
Some common coverage included in hospitality insurance policies is:
Hospitality payments are the systems and procedures that hospitality businesses use to accept payments from guests.
These systems can include software that allows for secure online payments, or third-party gateways that facilitate payments made by credit card, debit card, mobile payment, bank transfer, or app.
Contactless payments are becoming increasingly important in the hospitality industry because they are hygienic, efficient, and improve the customer experience. They allow customers to make payments without physical contact using smartphones, cards, or other devices.
Hotels and STR managers need to implement secure payment technology policies and procedures to protect customer and business data. Integrated payment solutions can help safeguard sensitive information through encryption, tokenization, authentication, and compliance methods. Payment gateways can also help handle chargebacks in case of fraudulent charges.
Some payment methods that hospitality businesses can accept include: Credit card, Debit card, QR code, UPI, Pay later, Bank transfer, apps like PayPal, Apple Pay, and Google Pay.
Hospitality accounting is a specialized discipline that involves tracking and managing the income, expenses, assets, and liabilities of businesses in the hospitality industry, such as STRs, hotels, restaurants, and resorts.
It includes:
Hospitality accounting is important because it helps businesses in the hospitality industry address unique challenges, such as labor costs, employee turnover, and customer relationship management. It also helps businesses plan budgets, save money for expansion, estimate profits, and maintain growth direction.
For example, hotel accounting helps hotels manage and monitor cash flow, which can help optimize revenue and identify areas for improvement. It also allows hotels to make informed decisions based on real data.
If you're reading this, you now know everything there is to know about the Short-Term Rentals Technology Landscape Terminologies.
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