Search

An Exclusive Look at Marriott’s Terms for Recruiting Short-Term Rental Hosts - Skift

istilahni.blogspot.com

Marriott International is aggressively signing up property managers for its Homes & Villas business, charging 15 percent commission on most stays, and barring property managers from working with Hyatt and Hilton, Skift has learned. The global lodging chain is even readying an employee discount program for stays at these properties.

Marriott for months has been signing up property managers. Vacasa and its new sister brand Turnkey as well as Natural Retreats are three of the more widely used management companies on Homes & Villas.

But the girth of the Airbnb initial public offering and the stellar performance of vacation homes in lockdown-free geographies during the pandemic certainly supercharged Marriott’s property recruitment efforts.

Join Us at the Skift Short-Term Rental and Outdoor Summit on May 19

The tactics are the latest example of Marriott signaling Homes & Villas has major growth potential, despite repeated messaging in the initial months after its 2019 launch that it was a very small division of the company.

In terms of financial reporting, Homes & Villas is still small. Unlike other Marriott brands and divisions like Ritz-Carlton, Westin, and Residence Inn, Homes & Villas hasn’t appeared in any of the company’s recent financial disclosures with the U.S. Securities and Exchange Commission.

But this is no longer just an entity providing business customers more ways to cash out Bonvoy points on leisure stays.

Marriott added thousands of homes to the platform in the years since a pilot version of Homes & Villas debuted in 2018 with 200 listings. Marriott President Stephanie Linnartz said there were more than 25,000 listings on Homes & Villas during a February investor call and that there are “a couple million homes in the segment we play in.”

Current job openings at Marriott also signal further integration of Homes & Villas into the company’s network. This includes retiring the existing reservations system in favor of a new one that encompasses vacation rentals and non-lodging products like a Ritz-Carlton yacht and all-inclusive resorts. There is even a job opening aimed at beefing up the platform’s presence internationally in markets like Europe.

“We don’t see a lot of optimism right now about that city center business travel hotel driving business in the near-term. Now, we’re looking at the vacation home side being a standalone driver versus a secondary benefit to support the loyalty program,” said Chris Anderson, a professor at Cornell University’s School of Hotel Administration. “That’s what we see going on here: a shift of where this program falls within the profit portfolio for the company compared to just support growing loyalty members.”

Although many vacation rental managers are attempting to generate direct bookings, Airbnb, Booking.com and Vrbo seemingly dominate the sector among the big platforms. In theory, that makes it tough for a newbie to short-term rentals to break in.

But T.J. Clark, Turnkey co-founder and now Vacasa vice president of business development, argued that Homes & Villas is finding a niche.

“They have found a differentiated offering in the marketplace,” Clark said, “which is providing an upscale selection of curated inventory that’s provided with consistent fine hospitality service.”

The Pitch

Homes & Villas salespeople and executives are emailing and phoning prospective property managers — Home Management Companies, or HMCs, in Marriott’s parlance — and pitching them that signing up will give them access to Marriott’s 145 million Bonvoy loyalty members, its distribution and marketing channels, and the chain’s procurement pricing.

Other advantages, Homes & Villas salespeople preach to property management company prospects, include brand affiliation with Marriott International, sharing insights on traveler behavior, guidance on property renovations, leads on home owners considering joining the management company, and a dedicated account manager.

Marriott salespeople tell prospective villa managers that its strategy is to onboard luxury villas that create memorable experiences for Bonvoy members in key destinations.

Some of those selling points mirror Marriott’s pitch in other sectors, as it increasingly taps into new segments of the market away from a traditional hotel stay. Along with the Homes & Villas’ growth, Marriott increased its presence in the all-inclusive resort sector earlier this year by signing a 19-property deal with Toronto-based Sunwing Travel Group.

The beefed-up framework around Homes & Villas highlights a more concerted push into growing this Marriott division as it approaches its second birthday later this year, but it still isn’t expected to be an eye-to-eye competitor of Airbnb.

Homes & Villas is a closed platform as Marriott will only work with professional management companies as providers. Just as a Marriott hotel has brand standards, a Homes & Villas listing also has to adhere to standards surrounding amenities, safety, and a design aesthetic.

“Throughout the recruitment process, Marriott International audits and reviews Property Management Companies to ensure they meet Marriott’s standards for regulatory compliance, design and amenities,” the company said in a statement to Skift after publication.

Contract Terms

Among the business terms that haven’t been published until now, Homes & Villas’ standard contracts require home management companies to give Marriott access to all of their homes, and Marriott will curate which ones it wants to offer. In the initial term of the contract, Homes & Villas bars properties from signing deals with competitors such as Hilton and Hyatt — which is believed to be on the cusp of launching a rival vacation rental service — but they are permitted to distribute their inventory through online travel agencies such as Airbnb, Booking.com, and Vrbo.

Hyatt declined Skift’s request to comment for this story, but potential competition from fellow traditional hotel companies isn’t new.

Accor repackaged its own Onefinestay rental business late last year into Apartments and Villas, a platform with a name similar to Marriott’s, and one that also includes extended stay hotel bookings with brands like Adagio, Mantra, and Hyde Living.

Home management companies that join Homes & Villas are permitted to use only the following channel managers to handle distribution: Rentals United, Booking Pal or Nextpax.

Under the standard contract, Homes & Villas takes 15 percent commissions on the most common type of stays — those where the nightly rate is less than $2,000 — and the commission rates fall to 10 percent on bookings with nightly rates of $5,000 or more.

Commissions, or take rates, of around 15 percent are fairly standard among the big players in the short-term rental industry, although the precise amount can vary by property, geography or timing.

Property management companies, though, have some flexibility in raising nightly rates to fund the commissions they would owe Homes & Villas.

Employee Discount Program Coming

Skift learned that Marriott intends to launch in the next several months a Marriott International employee discount program for Homes & Villas that is bankrolled by both Marriott and the property management company. For example, on stays for less than $2,000 per night, employees would see their rates reduced 10 percent. Homes & Villas would take a 7 percent commission instead of the usual 15 percent, and the home management company would reduce the rate 3 percent.

Just like the online travel agencies

Homes & Villas is transitioning into being the merchant of record on stays booked through the platform. With some irony, Homes & Villas contracts state that Marriott owns all guest data, and that properties can use that data only to service reservations, and not to retarget guests with advertising.

Hotels have long complained that online travel agencies own customer data and don’t share that data with hotel partners when lodging bookings take place through online travel agency websites.

In other terms of Homes & Villas contracts, the properties can set the cleaning fees and they can take guest deposits offline, and must return them within 48 hours if the stay went smoothly without damages.

Appease Investors

Vacation rentals offered a rare growth opportunity for Marriott last year at a time when development pipelines were in jeopardy due to tightening financing for new-build hotel projects.

“These guys are all publicly traded and need to highlight their growth,” said Nicolas Graf, associate dean at New York University’s Jonathan M. Tisch Center of Hospitality. “If there’s no growth in the traditional hotel space, where do you go? You shift to another market that shows there is potential growth.”

There will be competition from the likes of Airbnb and potentially other hotel companies in recruiting more property managers. But vacation rental growth is still significantly less resource-intensive for Marriott than new-build hotels and even conversions, the increasingly popular way to add more rooms to the pipeline by inking deals with owners of existing hotels.

“No one’s sure if this is going to be a long-term structural change or just a blip,” Anderson said in reference to Homes & Villas. “It’s an ideal strategy because you can enter a market really quickly and cost-effectively. Even if business travel comes back in two years, you’ll still have all this product there for those customers to use their points on redemption stays.”

Register Now for the Skift Short-Term Rental and Outdoor Summit on May 19

[UPDATE]: This story was updated following publication to include a statement from Marriott.

Photo Credit: Homes & Villas' growing operations framework, from recruiting tactics to contract terms, shows the division of the company is poised to no longer be the very small entity it was once described as by Marriott leaders. Marriott International

Let's block ads! (Why?)



"term" - Google News
April 28, 2021 at 03:04AM
https://ift.tt/3eH5UTg

An Exclusive Look at Marriott’s Terms for Recruiting Short-Term Rental Hosts - Skift
"term" - Google News
https://ift.tt/35lXs52
https://ift.tt/2L1ho5r

Bagikan Berita Ini

0 Response to "An Exclusive Look at Marriott’s Terms for Recruiting Short-Term Rental Hosts - Skift"

Post a Comment

Powered by Blogger.