{"id":47433,"date":"2022-08-07T15:19:53","date_gmt":"2022-08-07T15:19:53","guid":{"rendered":"http:\/\/54.247.233.135\/vacation-rental-case-studies\/vtrips-case-study\/"},"modified":"2026-07-28T10:24:32","modified_gmt":"2026-07-28T10:24:32","slug":"vtrips-case-study","status":"publish","type":"case-study","link":"https:\/\/rentalsunited.com\/es\/vacation-rental-case-studies\/vtrips-case-study\/","title":{"rendered":"VTrips"},"content":{"rendered":"
\n\t\n\t\t
\n\t\t\t
\n\t\t\t\t\t\t\t\t\t
\n\n

VTrips<\/h1>\n\n\n\n

VTrips is a US-based property management company with over 1800 vacation rentals.<\/p>\n\n<\/div>\n\t\t\t\t\t\t\t\t\t\t

\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\"\"\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t<\/profidev-video-hero>\n\t<\/section>\n\n\n\n
\n\t
\n\t\t
\n\t\t\t
\n\t\t\t\t
\n\n

The Secret Sauce of VTrips<\/strong><\/h2>\n\n\n\n

DISCLAIMER: VTrips is not currently a customer of Rentals United \/\/ VTrips started 10 years ago in Florida and has since grown to 1800 properties in 5 different States in the US. The company has gorwn via M&A and with 14 offices the CEO is strong believer in having boots on the ground. Unlike other large property managers, VTrips runs on 3rd party tech instead of having built their own. Distribution is a key element of their successful strategy. <\/p>\n\n<\/div>\n\n\t\t\t\t\t\t\t\t\t

\n\t\t\t\t\t\t\t\t\t\t\t\t\t
\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

1800<\/h3>\n\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

rentals in 5 states<\/p>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t

\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

70%<\/h3>\n\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

from online channels<\/p>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t

\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

14<\/h3>\n\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

offices<\/p>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t

\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

150<\/h3>\n\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

employees<\/p>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t

\n\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t
\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t
\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

N of properties connected<\/p>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

1800<\/p>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

Headquarter Location<\/p>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

Florida, U.S.A.<\/p>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

Tech Used<\/p>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

Multiple<\/p>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

Website<\/p>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tVisit Now<\/a>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n<\/section>\n\n

\n\t
\n\t\t
\n\t\t\t
\n\t\t\t\t\t\t\t\t\t
\n\n\t\t\t\t\t\t\t\t\t\t\t\t\t

Grow beyond with Rentals United<\/h2>\n\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t

Here\u2019s how you can boost your short-term rental business today<\/p>\n\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\tGet Started\t\t\t\t\t\t\t<\/a>\n\t\t\t\t\t\t\n\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\n\t\t\t

\n\n\t\t\t\t
\n\n

Full interview of Steve Milo, CEO of VTrips<\/strong><\/h2>\n\n\n\n

Vanessa: Please can you tell us who you are, what you were doing before VTrips and your current position at VTrips.<\/strong><\/p><\/p>\n\n\n\n

Steve:<\/strong> Okay, sure. I\u2019m the founder, CEO of VTrips. I\u2019m not sure we were well known 10 years ago when I just had a handful of properties. My background previous to VTrips was technology. I was actually working as director of e-commerce for a pretty large consumer company in Chicago. I got into VTrips using my technology background and I\u2019ve been able to expand.<\/p><\/p>\n\n\n\n

Vanessa: How many properties do you have today?<\/strong><\/p><\/p>\n\n\n\n

Steve:<\/strong> We have 1800. We are multi-destination so we\u2019re in five states in North America, 14 offices, 150 employees. The thing that I think makes us different from many of the larger multi-destination companies is we have not taken any equity at all and financed through profit or through banks.<\/p><\/p>\n\n\n\n

Vanessa: <\/strong>Do you consider yourself more a B2C or a B2B? Who is your target customer?<\/strong><\/p><\/p>\n\n\n\n

Steve:<\/strong> It\u2019s definitely B2C but we get two customers. We have the owner of the property and we have the guest. The property owner we engage with on the basis of an exclusive contract. Our contracts are exclusive, which is different from Europe. Then obviously we have the guest who is staying at one of the accommodations and we are servicing. We are a full service property management company so we are offering end-to-end services.<\/p><\/p>\n\n\n\n

\n<\/p><\/p>\n\n\n\n

ON HAVING A MULTI-DESTINATION PROPERTY MANAGEMENT COMPANY<\/h2>\n\n\n\n

Vanessa: Great. You said five states, which states are these?<\/strong><\/p><\/p>\n\n\n\n

Steve: <\/strong>Florida, the largest state for vacation rentals in North America. We\u2019re in South Carolina, Tennessee in the mountains, in Mexico also in the mountains and then we\u2019re in Hawaii. Part of that geographic diversity is because we\u2019ve had our share of weather related hurricanes in Florida so diversifying our footprint just made prudent financial sense.<\/p><\/p>\n\n\n\n

Vanessa: How did you diversify? Did you acquire property management companies?<\/strong><\/p><\/p>\n\n\n\n

Steve:<\/strong> Yes, we started acquiring companies in the recession regionally. We just took our footprint in North East Florida which is where I\u2019m based. Initially we went up the coast using M&A of smaller companies and then we started to go outside of our region.<\/p><\/p>\n\n\n\n

Vanessa: What makes a good company to acquire?<\/strong><\/p><\/p>\n\n\n\n

Steve:<\/strong> I guess the answer would be people but that\u2019s not really the right answer. It\u2019s \u2013 we take a hard look at the data, the numbers of the market first. We look at markets, we want to enter a market and then we take a look at companies within that market that are looking to sell. That\u2019s where the people part comes into play but we\u2019re not going to just buy a company that\u2019s not in the market that makes sense to us.<\/p><\/p>\n\n\n\n

Vanessa: Right, how many companies have you acquired in total?<\/strong><\/p><\/p>\n\n\n\n

Steve:<\/strong> We\u2019ve acquired probably 15 or 16 companies. We\u2019ve done quite a few what I call \u201cin-market roll ups\u201d, where we\u2019re in the same market but we\u2019ve rolled up as many as four companies within the same market so it\u2019s been quite a few. Actually in about a one-year period we did 10 roll-ups in one 12 month-period.<\/p><\/p>\n\n\n\n

Vanessa: Whoa I bet that was a crazy year.<\/strong><\/p><\/p>\n\n\n\n

Steve: <\/strong>Yes it gave us some lessons. Part of that, doing this without venture funding is we\u2019ve been able to understand what worked, what didn\u2019t work and assess ourselves and put systems in place. Hire the people that would make sense for integration and be ready to essentially do M&A again which is actually what we\u2019re in the midst of doing right now. We\u2019re actually out raising a considerable amount of money (not equity, debt) and we\u2019ll be continuing to accelerate the M&A front in North America.<\/p><\/p>\n\n\n\n

\n<\/p><\/p>\n\n\n\n

ON INTEGRATING ACQUIRED COMPANIES\u00a0UNDER ONE UMBRELLA<\/h2>\n\n\n\n

Vanessa: What happens once you acquire a company? How is it then put into the brand? Do give access to technology? Is the property management company still running as always? How does it take advantage of this new acquisition?<\/strong><\/p><\/p>\n\n\n\n

Steve:<\/strong> The thing with VTrips is we are trying to move every company we acquire onto our technology platform within 60 to 90 days. We\u2019ve tried it both ways. We\u2019ve tried to operate them autonomously and we\u2019ve tried to integrate them quickly. The integration quickly is what makes the most sense. Part of putting them under our technology platform is that we get our Smart Home Technology, our distribution via our marketing partners, our revenue management and other management components, so we get to centralisation that we have at VTrips which is centralized accounting, marketing, IT, even reservation.<\/p><\/p>\n\n\n\n

It just makes a lot of sense to run both. The local company is typically, if it\u2019s a new market they\u2019re probably going to keep their brand and we co-brand. With local brands where they have deep roots within the community, we still keep those brands. We have the VTrips umbrella brand in terms of the people within the office, we try to give everybody we can a job. If they\u2019re in an accounting or IT or marketing function, we take a look and see if they can essentially assimilate into our centralized process.<\/p><\/p>\n\n\n\n

That\u2019s worked in some cases. We have people that are working in our satellite offices that are essentially leveraging their skills on the entire company. That\u2019s really the object of G&A roll up where you\u2019re gaining efficiencies, you\u2019re gaining centralization. You\u2019re able to through the centralization get some G&A efficiencies and synergies.<\/p><\/p>\n\n\n\n

\n<\/p><\/p>\n\n\n\n

BOOTS ON THE GROUND VERSUS A VIRTUAL OFFICE<\/h2>\n\n\n\n

Vanessa: Having local offices on the ground is important, you think?<\/strong><\/p><\/p>\n\n\n\n

Steve: <\/strong>Yes, one of the things I think you were at a conference where I talked about lessons learned. We tried this whole concept of the virtual office. In fact there were some conferences where I talked about the virtual offices back in 2010, 2011. From my standpoint, it did not work. I get where virtual offices are appealing particularly as a pitch deck power point slide. But, the reality is you need boots on the ground, you need guest services, you certainly need owner services and you need a nexus.<\/p><\/p>\n\n\n\n

That\u2019s a lesson we learn the hard way by doing it both ways. Having an office, having a nexus makes more sense. The one thing we\u2019ve learned is if we\u2019re going to market you don\u2019t need four or five offices in the same market. You can gain consolidation. That\u2019s something we\u2019ve done when we go in market and we do additional roll ups in market. You don\u2019t need to have four or five offices but you do need to have one.<\/p><\/p>\n\n\n\n

\n<\/p><\/p>\n\n\n\n

Vanessa: Given that your product is in non-urban resort locations mainly ocean \/ mountain leisure, is it possible to have a strong brand?<\/strong><\/p><\/p>\n\n\n\n

Steve:<\/strong> I think it\u2019s possible. I am not sure that it\u2019s our priority at this point. I think it\u2019s going to take a while to build a brand. I think that brand is going be built from the bottom up as opposed to top down I don\u2019t know that it\u2019s feasible to just spend a huge amount of money building PR, public awareness on a brand.<\/p><\/p>\n\n\n\n

But, I do think that as you start to gain consolidation synergies within market, certainly as you start to do some of the things we\u2019re doing which is our purpose built home communities where you have exclusive leases into perpetuity, that\u2019s where you\u2019re going to start to build a brand. I think that brand then can be built from the bottom up.<\/p><\/p>\n\n\n\n

<\/h2>\n\n\n\n

ON SCALING TOO FAST<\/h2>\n\n\n\n

Vanessa: What was your biggest business mistake?<\/strong><\/p><\/p>\n\n\n\n

Steve:<\/strong> We\u2019ve made some mistakes in terms of trying to grow too fast without having the infrastructure in place. I\u2019m talking about people so when we did ten roll ups in 12 months, we did not have the accounting piece in place. What I did is I slowed down, made sure I hired the accounting team which is a chief financial officer, a couple people and FPA \u2013 Financial Planning and Analysis.<\/p><\/p>\n\n\n\n

First of all I\u2019m very numbers driven and second of all, so much of on-boarding and bringing in companies is the due diligence and you can really lose control of your costs very fast. From my standpoint, I think it\u2019s been clear that this is not a sprint on the property management side \u2013 it\u2019s a marathon. Getting the foundation right, firming it up, making sure you have the people in place, making sure you have the core competency in places and fast.<\/p><\/p>\n\n\n\n

We\u2019ve certainly backed the trend about growing revenue at all costs. In fact I\u2019ve said forget about growing revenue. Let\u2019s focus on profitability, let\u2019s build this business the right way. We\u2019re in a marathon, we\u2019re not on a sprint. Some of the people that are racing ahead, we\u2019re going to see them on the sideline probably in a fetal position.<\/p><\/p>\n\n\n\n

\n<\/p><\/p>\n\n\n\n

NO TO BUILDING TECH, YES TO REQUESTS FOR PROPOSALS<\/h2>\n\n\n\n

Vanessa: <\/strong>It\u2019s a good expression \ud83d\ude42 You mentioned Smart Home Automation, Centralized Accounting, are these are these tools that you\u2019ve built yourself or do you rely solely on third party software?<\/strong><\/p><\/p>\n\n\n\n

Steve:<\/strong> That\u2019s a good question. Again, one of the things that we\u2019ve made a strategic decision to do versus not is work with hosted companies. There\u2019s been two paths, some of the companies that are venture funded or going after building their own software and getting into the software development component. We did not believe that that\u2019s a core competent for us. We are not software programmers but we are really good at property management.<\/p><\/p>\n\n\n\n

Instead what we like to do is partner with companies that are best of breed and work with their hosting systems and then API connecting together. So, Smart Home Technology, we\u2019re working with a company called B-Hunt 24\/7. They\u2019ve been excellent. Property management systems we\u2019re in the process of making a decision to migrate to a new hosted system. We\u2019ve done an extensive request for proposal.<\/p><\/p>\n\n\n\n

We have three companies that have been fantastic and I think have best of breed systems, Kigo, Guesty and Tracks. We\u2019ll be narrowing down that search by the end of the month or certainly the end of November. We have customer relations management systems. We host our website using a third party vendor. Distribution, we use a number of companies to help us with distribution, some of it directly through our property management system company and some of it using other companies called channel managers.<\/p><\/p>\n\n\n\n

<\/h2>\n\n\n\n

THE ACCOUNTING MODULE: A KEYSTONE FOR ENTERPRISE TECH<\/h2>\n\n\n\n

Vanessa: So you went ahead and put in a request for proposal\u2026 that\u2019s very common in the hotel industry but I actually never heard of this happening in the VR industry.<\/strong><\/p><\/p>\n\n\n\n

Steve:<\/strong> I think the VR industry is growing up a little. It\u2019s going from maybe infant stage to at least the next stage of childhood. Part of this is a request for proposals are critical. I think one of the things we did is, I actually formed a group with other enterprise customers called the Vacation Software Advisory Group. We went out and basically talked to a number of different customers about what our enterprise requirements.<\/p><\/p>\n\n\n\n

The reason why we just didn\u2019t do it is I didn\u2019t want to leave lead property management systems down a road of saying \u2018Hey this is a customized system only for VTrips<\/em>\u201d We really wanted to make sure that we just went through and we scoped out requirements from a number of enterprise leading systems in leading companies in North America. That\u2019s what we\u2019ve done. We came up with requirements and then we presented them to the property management systems and a number of companies were not at a point where they could even come close to those requirements. Three of them said \u2018Hey we can do it.\u2019<\/em><\/p><\/p>\n\n\n\n

To me, the thing is really separating the companies that are enterprise versus the companies that aren\u2019t, is the accounting system.<\/strong> I know that sounds like a common word, accounting system. Accounting systems in property management systems are very complex because not only do you have the reservation from guest but then you have the distribution back to the owner of the property. You have service order billing, you have all the things are functions through an accounting system. You have trust accounting in certain states and even certain counties and cities as well as well as sales tax and other distribution.<\/p><\/p>\n\n\n\n

All that stuff has a time stamp. We do auditing statements, we have a big accounting firm called Grant Thornton that does our audit statement. One of the things they do is \u201cmeans testing\u201d. At the end of the year when your books are closed they go back and they sample items from your system. If those items don\u2019t reconcile with your previous statements, that\u2019s going to give you a bad statement in terms of at least a foot known and certainly potentially even flagging you as a going concern.<\/p><\/p>\n\n\n\n

This is just common sense and I applaud the three companies that we\u2019ve talked to you about making the commitment to accounting system. Guesty has put a ton of money into building an accounting system, so has Kigo. Tracks is a little further along. But look, these three companies recognize, they want to be big and in order to get larger enterprise companies accounting is a core requirement.<\/p><\/p>\n\n\n\n

Vanessa: <\/strong>I don\u2019t know how they would be able to do this cross the Atlantic as well. It just gets so complex. Isn\u2019t it a question of finding multiple different technologies that connect to each other that are best of breed? What about accounting, this is not something that could be plugged in?<\/strong><\/p><\/p>\n\n\n\n

Steve: <\/strong>We did a diagram and accounting is really a core function. You can plug in just about everything else. I\u2019d say accounting, reservation, content and the way your rates display, how they are called out. That\u2019s your core component. Everything else can then be run through an API. Most of these companies particularly in Europe were built on reservations and rates. Accounting just was not something that they thought through at the beginning so there certainly is a bigger learning curve getting into North America. And as I said North America has numerous states that have trust accounting walls.<\/p><\/p>\n\n\n\n

You\u2019re going to have to do something called reconciliation where your bank account and your property management system audited a penny. It\u2019s very tough to get there but that\u2019s what enterprise companies need.<\/p><\/p>\n\n\n\n

\n<\/p><\/p>\n\n\n\n

ON DISTRIBUTION: LARGE OTAs, NICHE OTAs, DIRECT BOOKINGS<\/h2>\n\n\n\n

Vanessa: Good luck to them, I\u2019m very glad I\u2019m not in the PMS business but in the channel management business and in fact that leads me to the next question. How do you choose the channels that you work with, because with so many properties you must really excel at distribution, how do you choose the channels that you want to work with? Do you work with niche sites as well or are you just advertising on the big top 10 let\u2019s say?<\/strong><\/p><\/p>\n\n\n\n

Steve: <\/strong>Five years ago, 80% of our business was coming in offline, 20% was coming in online. Most of that 20% was coming in online was really through our own direct website. Fast forward to today and we\u2019re definitely closer to 70% online and 30% offline. The online makes it pretty interesting where OTAs, our friends Airbnb, Expedia, booking.com, those big three companies have made up a big chunk of online distribution.<\/p><\/p>\n\n\n\n

Back five years+ and it was mostly a business where you get an email or a phone call. Now everything is transactional. We\u2019ve been masters at transactional and we\u2019ve done it in a number of ways. One through API feeds directly through the property management system. Another is through companies that are channel managers like Rentals United.<\/p><\/p>\n\n\n\n

The interesting thing is 10% of our OTA business is coming from miscellaneous. So miscellaneous would be kind of a niche sites that you\u2019re talking about. There\u2019s a company in Gatlinburg Tennessee in the mountains that does well over 10% of our revenues in there, they\u2019re called smokymountain.com<\/a>. They\u2019ve built an amazing niche site.<\/p><\/p>\n\n\n\n

We have niche sites in Hawaii, we have niche sites in the Panhandle. The ones that have really works well for us are geographical niche sites because I think they can focus in on the organic search words. Then you got the big three or four, depending on if you want to separate the VRBO<\/a> out of Expedia. Those we\u2019ve made tremendous strides particularly the non VRBO business. This year we\u2019ve seen pretty significant increases at booking.com which in Europe obviously they\u2019re the dominant channel but in North America they\u2019re definitely not as big.<\/p><\/p>\n\n\n\n

We\u2019ve seen good increases in Expedia. We\u2019ve also seen healthy increases in Airbnb and Google is another component that we\u2019re working closely on getting integration directly with them. We are even taking a look at trying to get an integration directly with Ctrip or through channel manager so that we can access the China market. Distribution, I\u2019m a huge believer of it. I think what it does is it increases exposure, increases demand. The more demand that we have, the more occupancy we can fill and frankly some of the ADR we can tweak up higher. I don\u2019t really see the downside of distribution I only see the upside.<\/p><\/p>\n\n\n\n

Vanessa: <\/strong>Do you also drive traffic to your own website? Do you do adwords etc?<\/strong><\/p><\/p>\n\n\n\n

Steve: <\/strong>Yes of course. Our website is always going to have the lowest price. Once we get a customer through an OTA, that\u2019s when we begin the communication that \u2018Hey in the future, rebook with us directly.<\/em>\u2019 I think there\u2019s an inherent ability for property management companies to drive booking direct by educating the consumer that the best price would be on the website and part of that is we don\u2019t have a guest traveller fee.<\/p><\/p>\n\n\n\n

Some of these companies like Airbnb and VRBO are charging fairly excessive guest traveller fee. There\u2019s a portion of guests that have become extremely smart about just going to organic search and finding the direct source. In some cases we\u2019re charging different rate plans depending on the OTA. A company like booking.com has a fairly expensive cost of acquisition to their network. So we build that into the rate plan that we distribute to them so.<\/p><\/p>\n\n\n\n

That\u2019s we\u2019ve been able to manoeuver through what is a fairly tricky complicated process with OTAs.  On the direct side, we\u2019ve used that as a funnel. The business previously that I was in was called the Bradford Exchange. Bradford Exchange is probably not well known in Europe but a very large company in North America about a half billion dollar company direct to consumer and they did collectibles. They did plates, dolls, trains, jewelry, you name it, and they did it. They were really strong in continuity so \u201ccontinuity programs\u201d would be where they would just keep sending a product over and over again.<\/p><\/p>\n\n\n\n

If somebody was into jewelry and they had a bracelet they will continued to send pieces of the bracelet to them every single month. Those are called \u201ccontinuity program\u201d. When you\u2019ll find out is there\u2019s a major difference between the cost of acquisition and the true lifetime value<\/strong>. In the lifetime value, the customer can be worth a very large sum of money. That\u2019s where our ROI is base. When we take a look at these channels, it\u2019s not just the cost of acquisition were also factoring in what the true lifetime value is.<\/p><\/p>\n\n\n\n

Some of the channels that have the least disintermediation are going to be the ones that have the higher lifetime value. I strongly believe that Airbnb is the stickiest channel right now.<\/strong> Some of the other channels are less sticky and I think the lifetime value of their customers is much better since they are less likely to go back to that OTA, they\u2019re more likely to go back to the direct brand and book again.<\/strong><\/p><\/p>\n\n\n\n

Vanessa: Did you invest in creating a loyalty program at all?<\/strong><\/p><\/p>\n\n\n\n

Steve: <\/strong>We haven\u2019t yet it\u2019s something we\u2019ve talked about. These loyalty programs are tricky, you have to have them nail down <\/strong>because otherwise they become a liability. We\u2019ve been very careful and prudent about entering things until we absolutely have it nailed down. That would be one example.<\/p><\/p>\n\n\n\n

Vanessa:<\/strong> What about NPS? That\u2019s the big talk at the moment. Do you run an NPS for your properties?<\/strong><\/p><\/p>\n\n\n\n

Steve: <\/strong>We don\u2019t. We take a look at reviews, we have not done an NPS maybe we should. I hear it\u2019s a big buzz word in Great Britain.<\/p><\/p>\n\n\n\n

<\/h2>\n\n\n\n

CONSOLIDATION \u2013 WHICH BUSINESS MODELS WILL PREVAIL IN THE LONG RUN<\/h2>\n\n\n\n

Vanessa: Yes, you should listen to add to the interview with <\/strong>Graham Donoghue from Sykes Holiday Cottages<\/a>.  Let\u2019s talk a little bit about the industry. What are your thoughts around consolidation?<\/strong><\/p><\/p>\n\n\n\n

Steve: <\/strong>Obviously we\u2019re one of the companies that\u2019s consolidating because we\u2019re buying smaller companies up and we\u2019re rolling them into a centralized platform. I think it\u2019s a given because it\u2019s a highly fragmented market.<\/p><\/p>\n\n\n\n

Having said that, even with the amount of money that\u2019s been poured into the industry Vacasa <\/strong>by its own press release is saying that there were owning 3.3% of the north American market and 1% of the worldwide market. That\u2019s with hundreds and hundreds of millions of dollars invested in.<\/p><\/p>\n\n\n\n

I think in terms of consolidation we\u2019re going to see more consolidation, it certainly makes sense. Technology is allowing part of the consolidation and some of it is that the smaller companies are just very inefficient. There\u2019s also a large component of property managers we\u2019ve talked about you are in their sixties, seventies, even eighties and they\u2019re looking for an exit. Those companies are more difficult to integrate though. Those smaller companies of 50 to 100 units and you have to be good at integration.<\/p><\/p>\n\n\n\n

I think what\u2019s going to really separate companies that are actually consolidated is not how fast they consolidate but how much of the business they sustain two years after the acquisition.<\/strong> There are some companies that have made a lot of clippings about acquisition and roll up but they are haemorrhaging property owners as they bring them on in an attempt to merge them together. That\u2019s called churn. I think some companies have\u2013 that\u2019s their Achilles heel with their own internal software.<\/p><\/p>\n\n\n\n

That\u2019s just a fundamentally bad business model. It\u2019ll be interesting to see which business models actually prevail for the long run because some of them right now are inherently dysfunctional.<\/p><\/p>\n\n\n\n

\n<\/p><\/p>\n\n\n\n

FURTHER METHODICAL EXPANSION<\/h2>\n\n\n\n

Vanessa: How many property management companies are you looking to acquire next year? What\u2019s the big picture? Where are you going to be in three years, let\u2019s say?<\/strong><\/p><\/p>\n\n\n\n

Steve:<\/strong> We hope we\u2019re going to\u2013 that extent we\u2019ve actually sat down and talked about it. Our goal is to increase by three times our size within the three to four years so we have a path to do that. We\u2019ll increase our revenue or unit count and our bottom line actually will increase more than three times. That would put us give or take at 4,000 to 5,000 units and a very healthy top line and a very healthy bottom line. Certainly we\u2019d be up there with anyone in the industry probably better because we\u2019ve run such a good business.<\/p><\/p>\n\n\n\n

Vanessa: Great. Any other states you eyeing up? Are you coming to Europe? [laughs]<\/strong><\/p><\/p>\n\n\n\n

Steve: <\/strong>All my friends in Europe can rest assured, I\u2019m going to leave Europe to them. That\u2019s a great market, we love it but we have enough opportunity in North America and I like exclusive contracts. We\u2019ve been eyeing a number of different states but we\u2019re fortunate that Florida is the biggest state in in North America by far with the number of vacation rentals. In market it\u2019s highly accretive in terms of the margins that we can get. It\u2019s going to be a balance we actually are getting very granular and methodical into new markets.<\/p><\/p>\n\n\n\n

We\u2019re doing some pretty exhaustive research. We\u2019re using a third party to help us just a pin point the areas not just for occupancy but also ATR, fees, competition, all of the things that would really take a look at the market. We\u2019re trying to be very smart before we enter our market. It\u2019s very costly to enter a new market. I think one of the lessons learned is it\u2019s not how many markets you\u2019re in, it\u2019s how effective you\u2019re in\u2013 you do in the market you really are in.<\/p><\/p>\n\n\n\n

Our goal is certainly we would rather consolidate a market we\u2019re in than just race out and try to put a bunch of dots on the wall. That just doesn\u2019t make any sense to me, maybe the venture of capital funds but not to me.<\/p><\/p>\n\n\n\n

Vanessa: Very good, you seem very well prepared. Thank you so much!<\/strong><\/p><\/p>\n\n\n\n

\n<\/p><\/p>\n\n<\/div>\n\t\t\t<\/div>\n\t\t<\/div>\n\t<\/div>\n<\/section>\n","protected":false},"featured_media":4461,"template":"","meta":{"_acf_changed":true},"class_list":["post-47433","case-study","type-case-study","status-publish","has-post-thumbnail","hentry"],"acf":[],"_links":{"self":[{"href":"https:\/\/rentalsunited.com\/es\/wp-json\/wp\/v2\/case-study\/47433","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/rentalsunited.com\/es\/wp-json\/wp\/v2\/case-study"}],"about":[{"href":"https:\/\/rentalsunited.com\/es\/wp-json\/wp\/v2\/types\/case-study"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/rentalsunited.com\/es\/wp-json\/wp\/v2\/media\/4461"}],"wp:attachment":[{"href":"https:\/\/rentalsunited.com\/es\/wp-json\/wp\/v2\/media?parent=47433"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}