Booking trends show that there has never been a better time to be in the luxury vacation rental business. 

In the past year, demand has increased dramatically. High-net-worth individuals who were already earning more, spending more and travelling more than the average person before the pandemic have piled up extra savings and are increasingly choosing luxury vacation rentals over 5-star resorts and hotels. 

In addition, booking behaviours have changed. With remote work becoming the standard across various countries and professions, wealthy travellers can travel even more freely than before. They bring their families and staff along, travel all year-round and stay longer, overwriting pre-pandemic seasonality and LOS trends.

However, with increased demand comes increased competition. To attract high-value bookings, property managers must optimise their marketing and distribution based on the unique needs of luxury properties—which are very different from your typical short-term rental.

If you’re looking for some concrete, actionable advice on how to market your luxury vacation rentals in 2022, read on. For this deep dive, we interviewed three experts who shared their first hand-insights: 

The 3 pillars of a successful luxury vacation rental marketing strategy 

1. Select your distribution channels strategically

For non-luxury, mass-market vacation rentals, maximising visibility and exposure on sales channels is considered best practice. The more places you advertise your rentals online, the more potential guests will see them and the more bookings you’ll get.

However, for luxury vacation rentals, this is not the goal. The “as-many-eyeballs-on-your-listings-as-possible” approach doesn’t serve a type of product that’s meant to attract a very specific, niche audience. Simply put, luxury rentals are not for everyone. And marketing them to everyone is not going to get you the results you seek. 

In fact, listing your luxury rental on too many channels can hurt its positioning and even its revenue potential. By over distributing your property, you risk devaluing it in the eyes of potential guests. And as your property’s perceived value decreases, so do your bookings. 

So what should you do instead? Preserve your property’s exclusivity by distributing only on a handful of strategically selected sales channels. 

Let’s take a look at what that means. 

villa italy terrace with a view
Photo: Villa Dimora Bellosguardo, Florence, Italy. Art direction: Paola Gheis Luxury Rental Consulting. Photography: Iuri Niccolai

Luxury vacation rentals and OTAs

If you specialise in luxury rentals, OTAs and vacation rental marketplaces are not the ideal platforms for you. That’s why Airbnb created its specialised collection of luxury homes (Airbnb Luxe, formerly Luxury Retreats). 

And that’s why Moriya Rockman and her husband Ira launched Smiling House: they realised that “OTAs are not meant to give the perfect answer for this niche.” 

According to Moriya, luxury rentals have specific characteristics that make OTAs a bad match for them. 

These include:

  • A discerning audience. Wealthy travellers don’t shop around on mainstream booking sites. They’re more likely to browse niche websites or join member’s clubs that specialise in high-end rentals. In addition, they often hire travel agents or travel designers to find and book accommodation for them. To cater to the needs of their discerning clientele, these professionals prefer to use specialised channels over OTAs.
  • Request-to-book. Most mainstream OTAs are based on instant booking, which means that every reservation is instantly confirmed without waiting for the property manager’s feedback. This makes it impossible for you to be selective about the bookings you accept. Since luxury homeowners are more concerned with finding trustworthy guests than maximising revenue, having the option to say ‘no’ is a must. 
  • High-touch customer service. Compared to your typical Airbnb booking, a luxury rental reservation requires a lot more communication with the guest. You need to know as much about the guest as possible to be able to provide them with an exceptional experience. Luxury travellers often have complicated requests and unique preferences that you must cater to—more on that later. In short, mass-market OTAs don’t provide the tools or the concierge-style customer service to fulfil these guest communication needs.

The obstacles we listed above seem like a lot to overcome—but that doesn’t mean you can’t distribute luxury vacation rentals online. On the contrary: you should list them on niche channels that address the specific distribution needs of luxury properties.

A niche channel specialising in luxury rentals

Smiling House, for example, ticks all the boxes. After managing 120 luxury rentals in the Swiss Alps for many years, Moriya and her team realised that luxury rental operators around the globe were hitting the same walls when trying to list on OTAs. So, they’ve built a niche channel that provides a solution for all luxury vacation rental managers, no matter where they are in the world. 

Smiling House works exclusively on a request-to-book basis (“The final ‘yes’ or ‘no’ is always the property manager’s,” says Moriya). They operate similarly to a travel concierge, taking the time to learn about the entire guest journey, as well as the guest’s specific needs and habits.

“Last week we had a guest who was travelling with seven dogs. He didn’t mind paying the $30,000 security deposit for a luxury property—and in the end, there was very little damage. Without high-touch, real assistance from my team, this booking would never have happened,” Moriya says.

smiling-house

In addition, Smiling House optimises the guest experience by offering a variety of payment options (luxury guests often prefer bank transfers over credit card payments for high-value bookings) and personalising the stay down to the last detail.

Currently, Smiling House offers 4,500 listings in 125 destinations worldwide—and growing by the day—plus many more exclusive, “on-demand” rentals that can only be booked off the OTAs. 

For property managers, Smiling House promises a higher ADR, longer stays and increased occupancy rates. By listing on Smiling House, you don’t just get exposure to high-net-worth B2C customers. The platform also has a B2B layer, which means you can capture demand from professionals, such as travel designers and clubs like American Express or ThirdHome. 

“Our mission is to make a good property management team into an excellent one,” Moriya says.

Smiling House is coming soon to Rentals United! Stay tuned. 

Automating your channel distribution

Chris Pikoulas and his team at Mykonos.Luxury manage 50 luxury villas on the Greek island. Out of those, only 15 smaller villas are listed on Airbnb and Booking.com. The rest of their portfolio—comprising larger, ultra-luxury villas—is distributed exclusively through travel agents and niche channels. 

Chris and his team recently started connecting to niche channels through the Rentals United channel manager. So far, they’ve listed their villas on Homes & Villas by Marriott International and are soon to go live on Top Villas

According to Chris, this has been a crucial step for them because they still get 80% of their bookings from travel agents. Chris believes that relying too much on travel agents is a risky strategy because “the world is changing. We’re building the metaverse. Soon, everything will be online.”

Mykonos luxury villa with curved pool
Photo: Mykonos.Luxury

Having identified this shift in the market, Chris is aiming to “get more bookings from niche channels and less from travel agents”. Then, it’s just a matter of finding the balance between being available online but preserving the value and exclusivity of the villas by choosing the right mix of distribution channels. And a channel manager is a great partner in streamlining that process.

“​​Rentals United has a big variety of channels and it’s very easy to upload properties. Everything is automated. This is the innovation we need in 2022,” says Chris. 

Rentals United currently connects to four niche channels specialising in luxury rentals and more are coming soon. Talk to us if you want to learn more about expanding your distribution.   

2. Curate tailored experiences

All three experts we spoke with agree that curating tailored experiences is the only way to live up to—and perhaps exceed—the expectations of luxury guests.

Moriya and her team at Smiling House put a lot of emphasis on understanding the entirety of the guest journey. “The accommodation is just one part of the guest’s wider plans,” she says.

Chris echoes this thought, estimating that “The total experience is 30% the villa and 70% how you manage the guest’s total vacation.” Guests can find villas anywhere—the personalised service you provide is what sets your property management company apart. 

how to market luxury vacation rentals - Mykonos Luxury
Photo: Mykonos.Luxury

So how can you provide an elevated luxury experience?

First, you can go out of your way to grant special requests. “Some people say ‘I’m vegan and I want all my shampoos to be eco-friendly’,” says Moriya. To that particular guest, having these needs met is an essential part of the luxury experience. As a result, it’s essential to learn everything about the guest’s preferences prior to the stay.

According to Paola Gheis, who manages a family-owned villa collection in Italy, large groups staying at luxury villas usually celebrate some special occasion. She considers services like a private chef or live music standard requests. 

“High-net-worth travellers are becoming more demanding, pushing the role of the host or property manager into an evolving role of travel consultant,” Paola says. 

“The guests’ requests can reach a level where they want to discover the territory by staying inside their villa. And we need to be prepared to bring the best experiences by promoting the excellence of the territory,” she adds.

Using your local expertise is a great way to provide tailored experiences. For example, Chris and his team advise guests on which side of the island to stay on depending on whether they want to experience a windy or sunny Mykonos. They source foods from local producers and artisans, tailoring everything to their guests’ sophisticated tastes. 

Smiling House represents luxury rentals in 125 destinations around the world and their guests travel 6-14 times a year. As a result, they take personalisation beyond a single stay by advising guests on their next trip. “One guest just checked out of a ski chalet in Switzerland and has already booked their summer holiday with us,” Moriya says. 

3. Sell an aspiration

As a luxury rentals consultant, property manager and event host, Paola Gheis has a multi-faceted perspective. In her years working as a professional in the industry, she has discovered the key to branding and marketing luxury rentals.

“You want to tackle your client’s aspirations and work to sell the dream,” she says. 

villa italy tranquil garden
Photo: Villa Prenzano, Chianti, Tuscany. Art direction: Paola Gheis Luxury Rental Consulting. Photography: Iuri Niccolai

When purchasing a product or service, consumers aspire to achieve some kind of elevated status. They dream of how the product will transform their lives—even make them into a better version of themselves. This is the value that effective marketing messages must communicate.

In the case of luxury rentals, the marketer’s job is to capture this aspiration. Once you understand who your target audience is (a good way to find out is by building a marketing persona, says Paola), you can define your positioning and create a clear statement about the uniqueness of your offer.

Paola uses neuromarketing techniques to craft a narrative that has an emotional impact on the audience. “The goal of our communication is to generate empathy—that’s how you steal the heart of someone,” says Paola. 

According to Paola, the luxury rental strategy has four pillars: uniqueness, craftsmanship, excellence and emotion. 

Luxury rentals must have impeccable design (affluent guests have a keen eye for detail) and reject mass-produced items in favour of unique and hand-made ones. The listings must be presented using high-quality photos and videos and flawless copy. And last but not least, you must go above and beyond with your guest communication. 

Part of the guest’s aspiration may be tied to developing an understanding of the local area, its history and culture. “It’s part of my vision of luxury to be very tied to the territorial experience,” says Paola. 

“The idea is that the guest leaves the vacation with a deeper understanding of the destination. It’s our duty as hosts to provide opportunities for learning,” she adds.

Conclusion: Marketing your luxury rentals in 2022

Luxury rentals are arguably the oldest type of short-term rental property; yet, their online distribution has taken longer to evolve than that of non-luxury rentals. 

Today, property managers have more and more opportunities to market their luxury rentals online. But in order to preserve the perceived value and exclusivity of their rentals, they must strategically select a limited number of distribution channels. 

A channel manager like Rentals United—with connections to niche channels specialising in luxury rentals such as Smiling House—can help you build the right distribution mix and drive high-value bookings.  

Besides strategic distribution, it’s equally important to market your properties in a way that captures your guests’ aspirations and provide tailored experiences. These are the key elements of successfully marketing your luxury rentals in 2022.

Are you ready to build a tech-based distribution strategy? Discover how our enterprise-level Channel Manager can get you more bookings.