Offering Guests a Direct Booking Option: Tips for Increasing Your Property’s Exposure
Vacation rental owners and Airbnb hosts share a unified mission: to maximize occupancy rates, ensure unparalleled guest satisfaction, and optimize profitability. These objectives form the foundation of a successful short-term rental business, driving hosts to constantly adapt and refine their approach in a constantly evolving market.
In addition to popular booking platforms like Airbnb and Vrbo, another avenue of securing guests- direct booking- has been gaining momentum across the industry.
Direct booking is a compelling approach, promising more control over your short-term rental and the opportunity for increased profit margins by bypassing the commission fees of common mainstream booking platforms.
Are you thinking about trying something new beyond Airbnb or Vrbo, or maybe just interested in adding more ways to connect with your guests? Getting to know the ins and outs of direct booking is a smart move. This blog will walk you through everything, showing you how direct booking can work hand-in-hand with what you’re already doing or open up a whole new avenue for your business to thrive.
Here is the ordered list.
- Understand Your Activities and Risks – Before you start shopping for insurance you should think through how you will be using your property or vehicle. Switching from personal use to business use (like Airbnb or ridesharing) changes your risk exposure, and traditional policies may not cover these hybrid uses. Then do your best to visualize potential risks such as injuries and property damage. You can also consider if you will need business income coverage during a claim which is important if you rely on this income to make ends meet.
- Communicate Clearly with Your Broker or Agent – Be transparent about how you will be using your home or car when speaking with your broker or agent. We often talk to clients that say they hide what they are doing so their insurer doesn’t drop their coverage. However, as discussed in this article, even if your coverage is in place at the time of a claim your policy could be found null-and-void if the policy has an exclusion for what you are doing, like the commonly found business activity exclusion. We always say that the wrong insurance is the same as no insurance, so be sure to provide specific details and ask targeted questions about coverage to make sure that you are not paying for coverage that won’t show up for you.
- Clarify Coverage and Review Exclusions – Ensure your policy covers the intended activities including personal use, business use, and if you anticipate that the property will sit vacant for a period of time (like during the off-season). Then review the exclusions in depth in the policy. Don’t be afraid to ask questions if you don’t understand the policy language. It’s important to know what isn’t covered so there are no surprises at the time of a claim.
- Anticipate a Detailed Underwriting Process – Be prepared for the insurer to conduct a thorough underwriting process, particularly for active income properties like short-term rentals. Ask if the coverage has been tailored to your specific risks like your backyard pool, the dock at your waterfront lake house, the trail that’s at the end of your neighborhood, etc. It’s important to know that the underwriter may ask you to adjust your property to limit your risks, like adding a handrail, securing your deck railing, etc.
- Ask About Additional Requirements – Certain activities, like operating a short-term rental that has amenities that take your guests away from your property like a bike or kayak or a golf cart, may require additional safety measures or policy endorsements/enhancements. It’s important to confirm these requirements upfront and make sure that your policy includes off-premises liability.
- 6. Review and Update Coverage Regularly
- If there’s any change in how a property is used or amenities that are being provided, it’s important to communicate that to the insurer. Ensure the coverage adapts to these changes to avoid being misinsured.
Here is the unordered list
- Understand Your Activities and Risks – Before you start shopping for insurance you should think through how you will be using your property or vehicle. Switching from personal use to business use (like Airbnb or ridesharing) changes your risk exposure, and traditional policies may not cover these hybrid uses. Then do your best to visualize potential risks such as injuries and property damage. You can also consider if you will need business income coverage during a claim which is important if you rely on this income to make ends meet.
- Communicate Clearly with Your Broker or Agent – Be transparent about how you will be using your home or car when speaking with your broker or agent. We often talk to clients that say they hide what they are doing so their insurer doesn’t drop their coverage. However, as discussed in this article, even if your coverage is in place at the time of a claim your policy could be found null-and-void if the policy has an exclusion for what you are doing, like the commonly found business activity exclusion. We always say that the wrong insurance is the same as no insurance, so be sure to provide specific details and ask targeted questions about coverage to make sure that you are not paying for coverage that won’t show up for you.
- Clarify Coverage and Review Exclusions – Ensure your policy covers the intended activities including personal use, business use, and if you anticipate that the property will sit vacant for a period of time (like during the off-season). Then review the exclusions in depth in the policy. Don’t be afraid to ask questions if you don’t understand the policy language. It’s important to know what isn’t covered so there are no surprises at the time of a claim.
- Anticipate a Detailed Underwriting Process – Be prepared for the insurer to conduct a thorough underwriting process, particularly for active income properties like short-term rentals. Ask if the coverage has been tailored to your specific risks like your backyard pool, the dock at your waterfront lake house, the trail that’s at the end of your neighborhood, etc. It’s important to know that the underwriter may ask you to adjust your property to limit your risks, like adding a handrail, securing your deck railing, etc.
- Ask About Additional Requirements – Certain activities, like operating a short-term rental that has amenities that take your guests away from your property like a bike or kayak or a golf cart, may require additional safety measures or policy endorsements/enhancements. It’s important to confirm these requirements upfront and make sure that your policy includes off-premises liability.
- 6. Review and Update Coverage Regularly
- If there’s any change in how a property is used or amenities that are being provided, it’s important to communicate that to the insurer. Ensure the coverage adapts to these changes to avoid being misinsured.
The Book Direct Movement
The short-term rental industry experienced a significant shift during the pandemic. Booking platforms like Airbnb started to prioritize guest reimbursements during the COVID lockdown, leaving the hosts to figure things out themselves. As a result, numerous hosts experienced significant financial loss due to cancellations and refunds, ultimately feeling ignored and unappreciated by Airbnb.
This sparked the initial boom of the #BookDirect movement, which is now recognized annually throughout the month of February. #BookDirectDay takes place on the first Wednesday in February, falling this year on February 7.
The book direct movement encourages vacation rental owners and Airbnb hosts to take back control by promoting direct bookings through their own websites or booking channels. By doing so, hosts can have more autonomy over their properties while also reducing their reliance on mainstream booking platforms.
Considerations Before Offering Direct Booking
While direct bookings ramp up control and profits, they do require a heftier slice of marketing effort to get your property in front of potential guests. There’s also the lack of OTA (Online Travel Agency) guarantees like Airbnb’s AirCover—although many believe such coverage to be the bare minimum anyway.
Another considerable drawback of direct booking is the challenge of vetting guests. Unlike most booking platforms that offer profiles with reviews from previous hosts, direct booking leaves short-term rental property owners without this valuable screening information, increasing the risk of hosting problematic guests. This lack of transparency makes it difficult for hosts to establish trust and confidence in who is staying at their short-term rental property.
Additionally, managing a property and handling direct bookings can quickly become a full-time job, requiring consistent attention to inquiries, bookings, maintenance, and guest communication. To alleviate this burden, hiring a professional property manager in your area may be recommended. Another option could be adding property management software into your workflow to help automate and streamline your direct booking process while integrating with other booking platforms.
The Benefits of Booking Direct
Direct booking is more than just a trend—it’s an opportunity for short-term rental property owners and Airbnb hosts to take control of their businesses. By offering direct bookings, hosts can experience a range of benefits, including:
- Increased Profit Margins: The primary incentive for offering direct booking is the potential for increased profits. Without paying commission fees to OTA’s, hosts can keep all of their earnings from each reservation. This can significantly impact the overall profitability of a short-term rental business.
- Better Guest Communication and Relationships: With direct booking, hosts have complete control over communication with guests from start to finish. This allows for more personalized and tailored interactions, improving guest satisfaction and increasing the likelihood of positive reviews. This can lead to repeat bookings and referrals, reducing the need for constant marketing efforts.
- Complete Control Over Your Short-Term Rental Property: When you book directly, you’re not just a host—you’re a short-term rental property manager. You control reservations, check-ins, and payments, totally controlling the guest experience from start to end.
- Flexible Booking Policies: Unlike OTA’s that have strict cancellation policies in place, hosts can create their own terms and conditions for direct bookings. This provides more flexibility for both hosts and guests, making it easier to accommodate changing circumstances or special requests.
Tips for Successful Direct Booking
Promoting direct booking may seem daunting, but with the right strategies and tools, it can be a successful venture. Here are some tips to help ensure your direct booking efforts are effective:
- Optimize Your Website: A well-designed and user-friendly website is crucial in attracting potential guests. Ensure your website is easy to navigate, has high-quality images, and provides all the necessary information guests need to make a booking.
- Offer Incentives: To entice guests to book directly with you, consider offering incentives such as discounts or added amenities. This can make your direct booking option more appealing compared to OTA’s.
- Utilize Social Media: Social media platforms like Instagram and Facebook are great tools for promoting your direct booking option. Share high-quality images of your property, engage with potential guests, and provide links to your website.
- Prepare for Anything: It’s important to note that you never really know who is staying at your property, whether through a booking platform or direct bookings or the type of damage they can cause, whether it’s accidental or intentional. Even if you feel prepared, you also have no control over injuries that may occur due to your short-term rental operation. That’s why having a comprehensive short-term rental insurance policy like the one offered by Proper Insurance is an absolute must. Proper Insurance replaces your current Homeowners or Landlord policy with specific coverage for the risks of short-term renting like guest-caused damage, on-and-off premises liability, business revenue protection, bed bugs, squatters and more.
- Create a Guest Database: Building a database of your past guests can be a powerful tool to encourage repeat visits. Maintaining a detailed record of guest information allows you to personalize communication and send targeted promotions or updates. A product like StayFi can help you collect your Airbnb guest’s information to encourage repeat bookings.
- Add Protection for Guest Damage: As mentioned above, when you move away from booking platforms like Airbnb, you no longer have the hopeful (although never guaranteed) coverage of AirCover. By incorporating a damage waiver like the far superior product offered by Waivo, you can be confident that you have broad protection for guest-caused damage whether booking on Airbnb/Vrbo or direct bookings. Waivo requires no guest involvement and has a speedy reimbursement process.
Direct Bookings: The Future of Short-Term Rentals
Embarking on the journey of direct bookings can seem challenging, but the advantages it bestows upon short-term rental owners are undeniable. With greater profit margins, enhanced guest relationships, and full autonomy over rental operations, hosts are empowered to define the success of their properties on their own terms.
The integration of strategic tools and insurance coverage ensures that, while you invite guests into personal spaces, your financial and property interests remain safeguarded. As the industry evolves, the power in the hands of hosts will only grow, making it crucial to adapt and embrace the potential that direct booking holds.
Let direct booking be your stepping stone to a more profitable and personalized short-term rental experience.
Book Direct Insurance
Proper Insurance is the optimal choice for vacation rental owners and Airbnb/Vrbo hosts seeking comprehensive coverage for their short-term rental.
Proper Insurance is the nation’s leading short-term vacation rental insurance provider, with the most comprehensive policy on the market. We protect homes in all 50 states with unmatched coverage for your property, revenue, and business liability, customized to include guest-caused theft/damage, liquor liability, amenity liability (bikes, kayaks, hot tub, etc.), bed bugs, squatters, and more.
