When my fledgling company first started managing short-term luxury rentals in South Florida six years ago, my wife Vanessa and I changed the sheets, cleaned the toilets, responded to queries from guests, and used Airbnb as our single platform to keep the properties rented.
It was a 24/7 job—in a word, a nightmare. We were a small business with a big problem to solve.
Complicating matters is the fact that our company, The Vacation Creation, is a very seasonal business that does the bulk of its sales in the winter months, when tourists flock to Florida. How were we going to attract renters to our oceanfront condos during the low-season months of August, September and October with so much competition? As inexperienced entrepreneurs in our late 20s at the time, none of this was in our wheelhouse.
What we learned is that so much of what we do in the short-term rental industry can be automated. We now use an array of tech solutions to run our business, and in all honesty, little is required of us anymore. With all the tech, it’s seamless.
Over the past few years, we’ve adopted multiple technology platforms to engage customers, generate leads and boost profits and sales during the slow months.
Our business model is a little different from many vacation rental companies. The Vacation Creation doesn’t own the properties that we manage in Hollywood Beach, Hallandale Beach and Fort Lauderdale. We lease condos in condo hotel buildings year-round, then rent them out on a short-term basis. One of my best performers costs us $7,000 a month to rent and produces as much as $35,000 in monthly rental income during the high season and $18,000 to $20,000 in the low season. This year, our nine properties will yield roughly $2 million in revenue. I tease Vanessa that we’ve created a cash-printing machine.
We couldn’t do this without technology. One of our first investments was in Guesty, a property management software that pushes our listings out to 150 platforms like Vrbo, Airbnb, Booking.com, TripAdvisor and HomeAway. Everything you want to do is in one location: communications, payment processing, pricing and channel management, among other things. It costs about $1,500 to get set up on the platform and we pay $140 per month for each listing.
Another app I use is called Wheelhouse, a dynamic pricing tool that tracks historical, current and future earnings of all vacation rentals in Florida. This plays a vital role when it comes to keeping the rentals occupied during the low season. It monitors data like festivals, sports events, boat shows and storms, refreshing pricing on a daily basis as needed. All I have to do is tell it what the maximum and minimum rates are, completely removing pricing strategy from my to-do list. It’s helped keep us very competitive in the space and maximizes revenue and occupancy rates. And it’s inexpensive: $20 a month per listing.
StayFi is another technology solution I like. When a guest logs in to our WiFi, they are required to enter their name, telephone number and email address to gain access—allowing us to capture their information and market to them with drip campaigns with promotional codes. It’s resulted in a decent amount of repeat business and costs $20 per month for each StayFi Access Point device.
As we look ahead, we continue to consider ways technology can help us be more efficient and drum up new business—especially during the off-season.
We recently added Operto, a smart-home software program that manages the locks, thermostat and guest access along with providing biometric identity verifications, house rules, restaurant recommendations and early check-in requests. Guests love it, and it costs only $7 per listing per month.
By the end of 2023, we hope to have 100 properties in our portfolio in South Florida, eventually expanding into vacation destinations like Nashville, Aspen and Park City, Utah. For us, it’s go big or go home.
We never could have imagined growing this big, this fast. Without our technology partners, it wouldn’t be possible. Personally, I believe technology is absolutely necessary in all businesses today, and companies that don’t begin to implement technology in their model will slowly fall off the grid as their tech-savvy competitors take the spotlight.Print this article