How Retailers Can Work With Airbnbs and Other Short-Term Rental Companies
Over the past several years, short-term rentals (STRs), like Airbnbs, have gained significant popularity among travelers. Occupancy rates set records in 2021 as the demand for these properties increased a staggering 27.5 percent. One reason for the sharp rise is that short-term rentals offer a more personable alternative to hotels and motels. STRs usually have more space, privacy, and other desirable amenities for travelers.
But retailers interested in working with Airbnbs and other short-term rental companies cannot rely on traditional sales and fulfillment models. The shopping motivations of guests differ from traditional retail customers and the customer journey includes several intermediaries, namely hosts and property managers. The discovery and supply chain processes are also altered, looking more like a hybrid direct-to-consumer (D-to-C) model where products are sought out and highly targeted according to the guest hierarchy of needs. Many of these products are from local retailers and merchants.
Understanding the Guest Hierarchy of Needs
For retailers, short-term rental hosts and property managers are not only customers, they're also the gateway to guests. The STR experience is enhanced when guests have the option to buy products and items showcased within a property, which is why “shoppable” spaces have risen in popularity. Still, the likelihood of a guest buying the mattress they’ve slept on or a piece of artwork off the wall and having it shipped home is low. That’s why it’s important to understand the guest hierarchy of needs in order to hone in on what really sells in the STR space.
And what sells differs from property to property. At a beach rental, for example, guests might want to purchase extra towels, kids’ water goggles, or sand toys. But if they’re staying at a mountain chalet, they might have forgotten an extra pair of wool socks or crave some hot cocoa after a brisk morning walk. The guest hierarchy of needs, which is about fulfilling an unmet or immediate need, begins well before a guest arrives and continues long after they’ve checked out of a property. Repeat STR stays are now more common than one-off bookings, making the customer journey open-ended. Although there are many, the core needs of a guest are: 1.) I’m hungry, bored or tired, or 2.) I want to impress someone.
Consider a daughter traveling with her mother. Her mother is on the cusp of turning 70. Before they arrive, the daughter might like to have fresh flowers and birthday balloons waiting on the table. How wonderful would it be for the soon-to-be birthday girl to walk in the door and immediately be greeted in a celebratory way?
While STRs are booming, there have been two massive opportunities missing in this space: retail and amenities. Solutions providers like The Host Co. have emerged to address these gaps. The Host Co. works directly with hosts and property managers, automating guest bookings and upsells, including retail sales and value-added services. Designed for spaces like Airbnb, the service gives hosts and property managers the ability to set up a digital storefront and add items for sale. This isn’t about charging guests for extra coffee or creamer. This is giving STRs a way to upsell value-added amenities and the pricier items that guests want. The platform also collects data on guest demographics and purchases, and is able to share this data with hosts, property managers, and retailers when requested.
Guests Want Authenticity, and Local Products Meet Their Expectations (and Needs!)
Unlike hotels and similar properties, most STR owners and managers avoid holding onto large inventories of stock and don't invest in many high-end items to reduce the potential of theft and lessen the cost of damages. Wine glasses are a great example. Since they're an item that’s frequently broken, it doesn’t make sense to spend $100 on a pair.
Unless it’s a luxury property, the majority of things inside a STR are from places like Target and Wayfair. That’s why it’s senseless for hosts to list items such as bath towels and sofa pillows for sale in their storefronts. There’s no profit margin for the host and a guest can simply pick up the same products when they return home or order them online directly from the big-box store.
On the same note, guests crave authenticity, and want a stay that feels like an experience within an experience. To achieve an authentic feel, hosts and property managers often add a touch of local flair to their rentals. Likewise, offering local products (and services) in their storefronts enables hosts to elevate the guest experience even more. However, time is precious and sourcing and managing products can be overwhelming. Technology is helping to automate many of these tasks.
Using data from its system and having a team on the ground actively sourcing and testing products, The Host Co. connects smaller retailers and local brands with the owners and managers of STRs, recommending products as it sees a need arise, rather than pushing a need that doesn't exist. Guests might not realize, for example, that if they’re in town attending Coachella, they’ll need a clear backpack. Or they might want special mementos and other souvenirs from their trips, but they dread packing more into their suitcases.
With a Host Co. storefront, guests have access to curated local goods, such as artisanal foods and crafts, as well as necessities like phone chargers and extra sunblock. Some items are stocked in the properties, while others can be delivered, offered at a discounted rate for local pickup, or purchased for shipment back home. Through these types of platforms, we’re just starting to see the transformation of short-term rental spaces into marketplace retail opportunities. And the journey ahead looks exciting.
Annie Sloan is the CEO of The Host Co., a digital commerce marketplace for short-term rentals.
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Former HGTV Producer and Creative Director at Facebook, and today an avid traveler and a successful Airbnb host, Annie Sloan is the co-founder and CEO of The Host Co., a digital commerce marketplace for short-term rentals. The company’s platform enables hosts to create an online store to sell anything in their property, from the snacks in the fridge to the art on the walls. There are also additional preorder services including “stock my pantry” and connections to local artisan products for sale. Guests can make purchases before or during their stay.