Mike Bayer
Welcome back to the Vacation Rental Success Podcast. It's Mike Bayer, CEO and co-founder of the Vacation Rental Formula Business School, and I'm thrilled to share the fantastic response we've had to our newest training program, THRIVE Essentials, launched in October of 2024. THRIVE Essentials is designed to be the ultimate onboarding tool for vacation rental property management teams. It's perfect for quickly bringing new hires up to speed, cutting down on training time, and ensuring they have the essential knowledge to thrive in their new role.

Mike Bayer
With THRIVE Essentials, your team members gain the foundational skills they need to be effective contributors faster, building confidence, loyalty, and job satisfaction. Right from the start. The feedback from property managers and HR teams has been overwhelmingly positive. Many are saying they wish they had had access to this program years ago. Enroll your new team members in THRIVE Essentials today and you'll see how quickly they adapt, contributing with confidence and being effective within days. For more details, visit the link in the Show Notes or head to vacationrentalformula.com to see how THRIVE can transform your team.

Mike Bayer
Now let's get into today's episode. Here's your host, Heather Bayer.

Heather Bayer
On today's episode, we're talking about what is arguably one of the biggest shake ups in the short-term rental world this year, Airbnb's new co-hosting platform. Is it a game changer or a game ender for traditional property management companies, or is this an opportunity for savvy property managers to set themselves apart? Joining us is industry expert and entrepreneur Thibault Masson of Rental Scale-Up and he's going to break it all down for us. So if you're looking to future-proof your business, this is an episode you cannot afford to miss.

Heather Bayer
This is the Vacation Rental Success Podcast keeping you up-to-date with news, views, information and resources on this rapidly changing short-term rental business. I'm your host, Heather Beyer, and with 25 years of experience in this industry, I'm making sure you know what's hot, what's not, what's new, and what will help make your business a success..

Heather Bayer
Well, hello and welcome to another episode of the Vacation Rental Success Podcast. This is your host, Heather Bayer and as ever, I am super delighted to be back with you once again. And today I'm super happy to welcome a guest who's no stranger to this podcast. He's a seasoned short-term rental entrepreneur, an expert on industry trends, and a thought leader when it comes to helping property managers stay ahead of the curve. Thibault Masson has been sharing his insights into this industry since before this podcast started in 2013. Through his Rentalpreneur Blog, which later evolved into Rental Scale-Up, and which I hope you have coming into your inbox regularly. I'll make sure there is a link in the Show Notes to that, because it's one of the best industry newsletters to subscribe to. His hands-on experience as a vacation rental owner and a remote host in Bali and Saint Barts, combined with his roles in industry leadership. He serves as Global Head of Product Marketing at Price Labs currently and was once Global Program Manager at Booking.com. So has a lot of experience and this just highlights his extensive involvement in our industry.

Heather Bayer
In this episode, we'll be exploring a game changing development in the vacation rental business. Airbnb's new co-hosting platform And I have to admit, I really don't understand how this all works. But I do see that there are some significant changes on the horizon, because Airbnb is positioning this tool as a way to connect homeowners with co-hosts who can manage their properties, not something new, but the way they're doing it and the way they're promoting it is pretty new to us. So what does this mean for the traditional property management companies, who have long been the backbone of this industry? Is it an opportunity to innovate, or a threat that could disrupt the market as we know it?

Heather Bayer
In this interview, we talk about the ins and outs of this platform, the challenges, the opportunities and everything it presents to property managers, and also how it fits into broader trends like the push for direct bookings and OTA independence. Thibault brings a wealth of experience and a really sharp analytical lens to this topic, and I ask him to unpack what Airbnb's move means, not just for the big players, but for individual operators, homeowners, and the future of short-term rental management. So whether you're curious about how to stay competitive in this changing landscape or you're looking for strategies to grow your own business, you're going to get a lot out of this episode.

Heather Bayer
So I am delighted to have back with me an old friend of this podcast, Thibault Masson from Price Labs and from the Rental Scale-Up newsletter, which, as I mentioned in the introduction, if you haven't subscribed to that, you need to do so right now. I will allow you to press pause and go to Rental Scale-Up and and get that subscription in, because it's well worth it. And I'll put  the link in the Show Notes for you.

Heather Bayer
Thibault, welcome. Thank you so much for coming back and joining me again.

Thibault Masson
Heather, such a pleasure to be here to talk with you and also to be with the Vacation Rental Success audience. It's been a while and that's fun...., I mean, it's the longest running vacation rental podcast, I think, in the world, probably right? And it's fantastic to see it go and adapt new topics, new things. So congratulations on that.

Heather Bayer
Oh well thank you. And you joined me right at the very beginning. I think that was in 2014. You were part of one of the very first tranche of episodes. So now we're back over ten years ago since we first recorded together. So it's just so nice to have this relationship that's kept going over the years, and to see where you've gone with your career in this lovely, lovely business. So did you sell your property in Bali?

Thibault Masson
Oh, that's a good question. Yes, yes, I did so after more than ten years. Yeah, we sold the one in Bali. It's been tricky, but with two little kids in Europe now, I'm, less of a nomad as I used to be. You know, as much as you want to fancy yourself as a digital nomad at some point, with two kids, it's kind of hard to be traveling. What we did as well, we also sold one of the properties in Saint Barts where I lived for quite a while, and now we are getting one in Venice, Italy. So.....

Heather Bayer
Wow, wow. So what's it like in Venice for short-term rentals? What's the feeling in the city?

Thibault Masson
It's a good one. So I think just like any market. So let me contrast that. Contrast that with Saint Barts. Saint Barts is an island that lives from tourism, just like Venice in a way. Right? But it's an island where 70% of people come and stay in a villa. Here in Venice, people come and stay in hotels. The hotel lobby is very strong in Venice. And what's happened recently, where they just banned - they don't allow new short-term rentals, so you can't get a license.

Thibault Masson
Luckily enough, because I've been in the industry for a while, what I did immediately, as soon as we thought about going to that market, I contacted the local short-term rental association. Always been in contact with them and I knew it was coming. So as soon as I could, I'd fill in the form to get my license. Even before that, we bought the house the same day we walked to  fill in the paperwork, said we need a license now. So yeah, regulations are coming for each and every market. So really, if you don't know your market really well, if you're alone, just go to your short-term rental vacation rental association. It's so important.

Heather Bayer
That is a great piece of advice.

Heather Bayer
So today we're going to talk about co-hosting and Airbnb's co-host network. So I have alluded to this a couple of times in podcasts. I spoke to Richard Vaughton a while back about this, but you've been posting a couple of times about the co-host network and the new co-host network, and I know co-hosting has been going on for a long time, and I understand there are people who are really confused about what's different? What is different about this? How is it different from traditional property management models now? And really in this talk, I want to explore the opportunities and maybe some challenges to the property management world. So let's start with, can you just sort of explain what it is and its main features?

Thibault Masson
Sure. So in many markets in the world now, Canada, US, France, the UK, for example, Australia as well, I think there's this new service available called the Co-Host Network. The co-host network that Airbnb launched, actually, it's been around for three years in France, for example. My being French, I've been looking at this for a while. So let's describe what it does for a moment. So basically if I'm a host on Airbnb, I can go to that page and find.... I can enter an address for a listing and find local co-hosts or other hosts basically who have said, have raised their hands, filled the form and say, yes, I want to be a co-host. Right? And they can do things. I think there's nine types of services they can do for me, which go from check-in, cleaning, optimizing my listing, so they can do one of these things or all of these things.

Thibault Masson
So let's say which was sort of like, you know, basic service somebody could do in the past for you. A VA could do optimizing your listing, to the full property management thing, which is like, you know, marketing for you, answering the questions from the guest and welcoming people and making sure your property is clean for the next guest. Right? So it's very important that you go to this website again. So you enter your address and you're shown the list of co-hosts. And as I said, depending on the services you want, they're going to be going to rank them and show them the the one that matches what you need.

Thibault Masson
What's been so very interesting looking at the French market, for example, the co-hosts you see are not exactly what Airbnb is saying they are. What I mean is that usually Airbnb always pitches this as being like your local co-host, this friendly neighbor helping you out. And at least in the Paris market, I was studying the other day, some of these people manage 50, 60, 120 listings. So they're probably very friendly, but not your local friendly neighbor. They are clearly companies.

Thibault Masson
So that's what you see. Basically it's a way for you to do this the way Airbnb says. What it's for, for them, it's a way to unlock a million more, millions more listings because that's what we just needed. Millions more listings again. So you think about this as a way for Airbnb to have like quality supply, maybe to retain people who are struggling as well. And that opens the doors for a lot of questions. But that's basically what it does. It's match. And what they do behind the scenes as well, this being Airbnb. Airbnb is also a trust platform. So they rank the people for you. And also it's a payment platform. So they handle the payouts meaning that you get a booking, the money will go to you and also to your co-host. That's what everybody does.

Heather Bayer
Yeah. And there was a survey. Airbnb did a survey and they said 40% of Airbnb hosts who were surveyed expressed a desire for assistance. That's a lot of hosts.

Thibault Masson
It's a lot. But what's also very interesting where there have been these two things, volume versus think. So Airbnb will always tell you that 90% of their hosts, 90% of the hosts have like one listing. Right? But that does not mean that most of the business is not done by professionals, or like a big chunk of the business is done by professionals who manage hundreds of listings. Right? So the number of listings managed by professionals is probably very big. I don't know how much that is, but it's much more than 10%, obviously. Right? But it does mean at least 90% of the people that have homes, a lot of people are struggling.

Thibault Masson
And actually what they said in that survey, they say they would give more availability to Airbnb, meaning they would host more if they had someone to help. Because in that number of people, you have people who are occasional hosts. Again, that's very important for us when we're professionals to think, what are we talking about here? Probably in a survey, you have people who maybe welcome guests a few times a year and they say, yes, if I have somebody helping me with cleaning or giving me the keys, I could do it a bit more. But otherwise it's everything. Every time it's me or my sister-in-law who have to arrange everything, it's kind of complicated. So it does point out to a need for this.

Thibault Masson
And again, it's not the first time Airbnb has been trying to help out hosts who are struggling. Right? They had a program already in the past with ambassadors, who basically you want. You arrived on a platform, you wanted to start listing. You know what to do, and Airbnb could match you with an ambassador who could help you with their listing and would give you $400 or $500 just to help that listing go live, because that's so much work. Airbnb is saving a lot of money by this in not answering your question, especially if you're a small host. Right? So it's better to give somebody else $500 and hire people to answer the questions for people just starting out. So that's really going further, as you can see, it's not just starting out and listing your property, it goes all the way to full property management service.

Heather Bayer
I remember when I was running my property management company, and particularly after about 2016 or so, when it began to really filter out into our rural Ontario area, that we began to find acquiring new owners was becoming  marginally more challenging, because they had more options. So I would talk to an owner who said, well, you know, I've got the option here to pay you 20% commission or just to pay a very small amount to Airbnb to do it myself. So I think I'm going to do it myself. And we would say, well, that's absolutely fine. If you want any help, you know, I'll look at your listing, and this was our practice. This is the way we did it. We'll help you out and check your listing, make sure you've got everything there. And what that did was create that trust and loyalty. So eventually they came back to us, usually within about 4 or 5 months because they found this was really hard work.

Heather Bayer
So we got them after they'd been doing it themselves and then realizing that time is actually money. And it was much more time effective for them to hand it over to us and just step back and let us do that. And we did that for several years until the whole co-hosting thing started, and more and more people came into our property management network who were simply co-hosting. And that's when the competition really began to heat up.

Heather Bayer
So what can you say about these challenges? Because these are big challenges now for traditional property managers who are looking to acquire new properties, because now they're not just having to go up against an independent host having to do it themselves. They're going up against the independent host doing it themselves and the co-hosts. So let's talk about these challenges. Is it a big a major challenge or is it something that traditional property managers can overcome?

Thibault Masson
So I love your example. Right? Because we talked about people who wanted.... It's exactly the people Airbnb have been saying this is for, right? They've been on the platform for a while now, they're struggling. They're about to leave. Right? And Airbnb wants to increase their supply. So if people are leaving, that's not helping them increase their supply. So that's a very good point. So it does mean in a way, again if you're a property management company, you can list yourself as a co-host and find new leads. So it's a great way, for free, to find leads. The catch is in Canada and US, for example, your profile cannot be under your company name. You have to be Jane Doe/John Doe. Right? They really want you to look like you as a person, even if you manage 100 listings. It's a bit weird, but that's, you know, on that feeling.

Thibault Masson
So the thing is, it's a way for you to get leads. But the billboard effect, by which you could also advertise the name of your company and people will think I'm going to find you directly is less obvious, but it doesn't matter so much. But it's not the same case for you listening to this from the EU. By law in the EU we have to know, users have to know whether they're talking to a business or an individual. So if you're a business, you actually must put your name out there. So it's a bit defeating the purpose of Airbnb on that, but that doesn't matter so much. So it's a source of leads in a way. One issue is what kind of leads are you getting? I've heard from some co-hosts that the leads you're getting are not always the best.

Thibault Masson
What I meant to say is, in your case Heather, you used to know these people, so you had pre-selected them. You were interested here in this case. Sometimes you get people who are struggling for good reason. The property is not great or they've  been terrible owners. We all know that some owners really don't want to attract sometimes, or some properties are not a good fit. So that's what I've heard as well that you get inquiries, but furthermore, the volume is a bit limited on the number of people who want to work with you. The quality can be a bit tricky, so as usual you have to select your properties. Obviously, if you can tour it before saying yes, that's fantastic, but I don't know how much you can do that when everything is online. Is it what people are expecting you to do? But I still would recommend keeping your SOP, the way you do your business, usually you just don't say yes. Obviously you want to talk with these people, or the other challenge here is as you talked about the margins, right?

Thibault Masson
We can imagine that you are now competing with people who are maybe managing ten listings, who are only relying on Airbnb so they don't have a PMS to pay for. They don't have an office at all, so maybe their cost base is lower than yours, so they can afford to have lower margins or sorry, not lower margins, but lower prices. But for you, that would be eating up your margins. So you can imagine it could be increasing now again, it's for the moment there's only 20,000 co-hosts in the world, I think, so it's I think 10,000 are live and 20,000 more want to join. But it could create some pressure right on the margins going down. So it's a risk, so opportunity as well. Again these property managers in Paris I know who are part of this program, their feedback I got is they're very careful who they accept, because in the end   these people have problems. Sometimes it's problems that cannot be solved, even by the property manager.

Heather Bayer
Yeah, that's an interesting one. So from a property manager perspective though..... Oh let's just go back to..... You were talking about leads. So a property management company can collect leads. Airbnb has always been very careful about what they..... I mean they started that term 'leakage' a number of years ago. They didn't want to leak their guests into somebody's direct booking program. How are they going about not leaking their owners to a traditional property management company? Who's going to take them on as a co-host and then bring them into their traditional acquisition method?

Thibault Masson
Yeah, exactly. That's such a great question. That is on my mind. I'm like, okay, that's strategically, it's not in their interest that this property manager would then list the same property they've got on Vrbo, for example. But actually it's possible they can, because that's what it all comes down to in the end, you're the co-host property manager or property manager. You have them. You have these people and these people want bookings. And you have to find demand as much as you can and so Airbnb lets you also handle that and list this property if you want on your PMS and then on to other channels. So that's interesting. I think probably it's better to have at least part of this availability, part of this listings. Nicer than nothing. That's very interesting, but as well, that's how we think about the world as vacation rental companies.

Thibault Masson
Now we also have to remember that for a lot of people, Airbnb is the world. It's the only thing, the only game in town. Right? I think we kind of talked about this before this call, but it's the only game in town. The same thing for a lot of entrepreneurs. Airbnb has been this amazing engine that has created entrepreneurs. Right? People are becoming hosts with their own place and they become entrepreneurs. And as well a lot of, you know, modern day short-term rental companies were born out of Airbnb, right? But people are starting to co-host themselves. Right? Just Airbnb is doing this framework. But before the playbook was more like I'm starting this an Airbnb and I got ten listings. I'm getting a bit overwhelmed. I need a PMS maybe to solve some issues and I'm going gonna need some of the platforms. Here, Airbnb in a way, has been making things so that if, for example, you have ten listings,  managing co-hosting as you call this now, managing co-hosting ten listings, you can actually stay on the Airbnb platform provided there's enough demand in your market, right?

Thibault Masson
Because now you know you have the teams feature to manage the cleaners. Next year, Airbnb is launching its Host Marketplace. So it means that next year, as a host, I will be able to connect to tools like Breezeway or Price Labs or other tools. Right? So these third party services basically that I could only use if I had a PMS, I don't need a PMS anymore. So I can also stay in the Airbnb ecosystem to manage my whole property management company. So we can see how, again, probably Airbnb is not saying that big property managers, independent minding property managers will do this, but they say for some of them it's going to be good enough and it's almost free of charge. So it's a real way for Airbnb to have a lot of their own supply, which are exclusive to Airbnb. And why not some property managers exclusive to Airbnb too? That's very interesting.

Heather Bayer
Yes. Yeah. And that that was my question. What are the long-term implications of property managers becoming increasingly reliant on Airbnb platforms? What happens to their own websites? What happens to their direct booking, the whole direct book movement. And I know we've talked for years about this being a fragmented industry. And I think 6 or 7 years ago we were saying it's beginning to smooth out, but it's not. It feels like it's becoming even more fragmented. But from what you're saying here, it's almost as though maybe it will shift back into something that is just one big.... I'm trying to trying to articulate this and not doing very well, but it almost seems like Airbnb will rule the world.

Thibault Masson
And that's fantastic. Not that, but that to think this because I'm going to go with the counterpoint on this. Exactly. Because when I put my North American hat, you know, from The Caribbean, we are North America, so the North American hat looks like this, right? Airbnb is the only game in town, Vrbo has been losing share. Booking.com is also - it always looks like 'next year is going to be big.' Right? If [Booking.com]you're out there looking and listening to this, I still love you. I worked there for five years, but it's true, Airbnb looks like the only game in town.

Thibault Masson
But if you look at Europe, for example, in Europe, Airbnb on the demand side, because in the end, what counts is only all this is true. I can build my business on Airbnb but what if demand stops? What if demand is not there anymore? Right? And I mean Airbnb as a whole, there's so much supply. They need a lot of demand, right? And again, they want to unlock millions more listings with this. What happens if you don't have enough demand? Well, in Europe I'm back from a big event in France. France is the number two market in the world for Airbnb. Second market in the world. They've been losing share big time. Big time to Booking.com. It's really crazy.

Thibault Masson
It's just, it's like, let's say there were like 40-50% of the share for property managers. Now they're like 25-30%. So Booking.com is as you know, has taken a lot of time to get its game right. And it's okay. And it ramped up the market spend on keywords for anything to do with vacation rentals. And the bookings are pouring in. So people are like, you know what, Booking.com is a bit 'meh' in terms of interface, but you're bringing in the money. So people are excited about Airbnb, it's true, it's shiny, it's great. But like, you know what? Good old Booking.com in Europe brings us some good business, so I'm also going to pay attention to this. So you can see how diversification is important, because I would - not even coming from Booking.com - I would not have bet two years ago that they would be the ones currently winning in Europe. And I say currently winning, who knows what's going to happen next year? I have no clue.

Thibault Masson
But it's interesting, right? If I build my business first, it's on somebody else's turf. What happens if my account gets banned? We've got good friends who got banned, even for a few weeks. Do you have enough money to run your business out of for some weeks? What happens if you get banned? But not only this. What happens if the platform itself is so much more supply than it needs? So much more demand and somebody else is coming? What are you going to do? Maybe Google Vacation Rentals is a very big source of business and you're not there. So it's also interesting to think about.

Heather Bayer
Yes. Yeah. I think it's easy to think that you're so surrounded by Airbnb, that that is all there is.

Thibault Masson
And the brand Airbnb, it's very interesting. Airbnb is such a great brand, right? As they say, We are a noun. We are a verb. Yeah. They're very proud of this, but it's even on the mind of us professionals. Again, I'm back in France. There was a law that was passed two weeks ago and people are traumatized by this, but it was actually reported everywhere, in newspaper.... It was called the Anti-Airbnb Law. And people were on stage, I heard lawyers on stage at the event saying, No, please don't call it this because it's not an Anti-Airbnb, it's anti-property managers like you and me. And if you don't get this right in the mind of people, it looks like it's a law against this big bad US company. Actually it's a law against local businesses like you and me. So it's very interesting the way the fact that we all call this Airbnb. So the amazing brand, it's kind of like makes you not think right about the reality of the market.

Heather Bayer
Yeah, yeah. Really interesting point. Let's go back to, you know, practically for property managers when they're listening to this and particularly when you talk about next year and the marketplace, I mean that if I was still a property manager, that would be a little concerning to me, particularly in terms of a lot of things, but owner acquisition just as a major one, how am I going to, as a property manager, sell myself as a traditional property manager to an independent owner when they have these or this option available to them at a lower price?

Thibault Masson
Yeah, I think it's a great point. If you think as well into the path, the journey of  an owner here, Airbnb I think is targeting more people who are already or who have already listed a property there and is struggling. Right?

Thibault Masson
As a property manager, probably you can still reach out to people, you know, if you're partnered with a real estate company and, you know, they've just acquired a vacation rental company, contacting them before they think about doing anything is still good. You still have a lot of people out there who don't want to touch anything, right? It's still to them it's an investment, or they live far away. So they would not even think about listing on Airbnb starting doing this. So it does mean that again, you have to think about who you want to target and find the right source for this. These people, you know, who just bought a property, for example. And because it does mean indeed people who are in the platform Airbnb the way they could be interesting, but they are the ones who will be presented with this option.

Thibault Masson
I'm not sure right now the co-host network is really on the mind of a lot of hosts. Probably will be. But just  to think about this again. Airbnb is big, but it's not the only game in town even for a lot of owners, let's say starting out, they probably know they want to make money with Airbnb, but they probably still want professionals to help out and do the check-in or cleaning and the rest. So there's this big local presence that, as usual, right here, if you are locally trusted and I think probably with other people, I think you do great training, you probably teach them that. But that's the key to success as well. Right? All this still works. It works in the end because you still want  luxury properties for example, or very big properties. They probably want to meet you, not just find you online.

Thibault Masson
It's not Tinder, I think, for  them, they really want to go a bit further and want to know about your professional record. And so anyway, just just to say it's there, it definitely can create some pressure on the margins, but it does not mean that you can't differentiate yourself. You still have to create trust. Have a good record of service.

Thibault Masson
If you're starting out, then indeed you need to have the best practices from the beginning, or at least inspire trust, right? And things such as being able to talk to owners and explain having data is important, right? Being able to explain that in a certain market, for example, what's the actual share of Airbnb versus Vrbo versus direct bookings? That's always interesting because you look like you can explain it's not just about Airbnb. Everything you can do as well. And I think that's very important. And again, the fact maybe you installed this company that will hopefully not disappear next year or, you know, next summer when the bookings are actually coming.

Thibault Masson
And, you know, as an owner, you end up with no one to turn to. Again, that's still important for a lot of people. This trust factor you can inspire by not just being a profile on Airbnb.

Heather Bayer
You made such a great point and we were talking about this before we started recording. We were talking about AI and saying it's when you're immersed in AI and you're trying out lots of different platforms. You get the feeling that everybody knows about this, and then you go out and talk to people who say, no, I've never tried ChatGPT, what's that about? And in my head I'm thinking,  have you had your head under a rock for a while? But this is exactly the same that you were just saying that people have bought a property coming into this for the first time. They've perhaps heard of Airbnb, but they don't understand...., they're not in it like we are, talking in these terms. They probably have never heard of a co-host or a co-hosting network and if you can get in there right at that very start to tell them from your perspective as a property manager what this business is about and that it is about more than Airbnb.

Heather Bayer
I remember, 2019 seems like a decade ago, and I was thinking back to the.... What was it called...., Host 2019, in London. You were there, weren't you?

Thibault Masson
I think I was, yes.

Heather Bayer
Yeah, just it just seems like forever ago. But I did a presentation, one of the opening presentations there on Don't Put All Your Eggs in one Basket. And I think that is still such a good message to go out with, to talk to owners with,   going with an Airbnb co-host means you are putting all your eggs in one basket. And if something should happen, as you've said, that puts people in a difficult situation. So that really got to me when you said that, and I wrote down the AI immersion problem and it's also the Airbnb immersion problem. When you're immersed in it, you forget that people outside the industry don't have that same perspective as we do, so it is possible to go out and change minds before minds have already been set.

Thibault Masson
Correct. Exactly. So you have to come early into that journey. If they're already listed in struggling on Airbnb, maybe it's a bit late. I'm not saying it's bad, but it's just like there's other people who are not there yet. And indeed you can catch them as soon as they buy a property, for example.

Heather Bayer
And you also mentioned trust. You know, it's something that that we talk about a lot on this podcast. I mean, Chris Maughan has probably been on here as many times as you have Thibault talking about trust. We'll be kicking off our what we call our SSTIR Crazy Month, which is in February, soon, where we talk about the real foundations of this business Safety, Sustainability, Trust, Insurance and Regulations. And Chris will be joining us for a complete week to talk about trust and things like if you're going to have a direct book website, then make sure that it is trustworthy that people go to it and they feel comfortable with putting their credit card information in. That is the bottom line.

Thibault Masson
Correct, correct. Obviously I worked at Price Labs, which is a dynamic pricing management company. And as we talked about with one of the co-founders, in the end we also sell trust, because people have to trust you. You talk about AI algorithms, but people have to trust that the input will be great pricing for that property because it's their revenues we're talking about, right? So in the end, it's in any kind of business. In the end we are in the business of selling trust. And then you have to deliver on it. But it's really, really important to remember that.

Thibault Masson
And it's again, for a lot of people a vacation rental is a lot of money to their investment. And they probably want to know, as usual, that the guests will be happy and my property will not be destroyed, and I will get enough money to pay back my mortgage, for example. All this is still true. And again, I'm not saying co-hosts can't do this. And again, you can list yourself as a property manager out there. But just to say all these questions are still true in the mind, right? So probably if you're on a on a platform, every platform is a co-host having templates ready to answer questions that already convey trust is important. And that trust you're going to convey. People will only be able to check that maybe against what you see on your own website at some point, right? How can I trust what you're saying to me in this message on Airbnb? Probably going to Google you to find you. You still need your website out there with these signals to link back to what you said about having your direct booking website. Very important because it's supporting even your lead conquest effort on Airbnb, if I may say so.

Heather Bayer
So let's close out this discussion by talking about direct booking, because that is still a movement and I sort of go backwards and forwards on whether this is a powerful movement or whether it's growing or in decline. What are your thoughts on where we go with direct booking?

Thibault Masson
All right. If you look at the travel industry, their booking is winning. Not it's increasing. Right. If you look at flights, hotels. All these these especially in the US, for example, the airline companies, the hotel chains for example, have increased the share of bookings that come from direct channels. It's increased. The only the only category in travel where it's not the same. Where the bookings are going down is vacation rentals. Why? Well, there's a few things to think of. It's kind of obvious, right? Our market is very differently structured, right? We can name like five airlines. If we name these five airlines in North America, we cover 80% of them, probably, right? Obviously, the number of suppliers in vacation rentals is, we said, millions of listings. I don't know how many property management companies. So it does mean that having a marketplace, that's what Airbnb or Vrbo is, a place where all this supply is assembled, helps me as a guest, as a consumer, as a traveler. Right. So there's there's value in bringing this together. And it's obviously then harder to stand out as a with your own direct website by just your own brand.

Thibault Masson
You can't it's very hard to be a national brand. We've seen we've seen all the national brands in terms of property management company, a lot of them going down because it's very hard to scale nationally. So then have national brand also. Yet it's not because that's the structure of the market, but it does not mean that in your local market you can't do direct bookings. If I'm being clear here, what I mean to say that the whole I've seen a lot of people having success on people getting booking again with them for the second time. So as usual, using the the big platforms first as a way to get known, to get people to book with them the first time and doing everything you can to capture their contacts, convince them, brand your apartment wherever you can so people know with whom they stayed because it's never said otherwise, right? You have to know who that is staying with you. So please make it available somewhere where I'm staying with you. I need to see your name out there.

Thibault Masson
And then people think, oh, if I go back I'll book again with these people, also, all this is true and still does. And what's very interesting as well, and has really changed my mind, is that obviously it's not obvious that it's always cheaper, but it's not because it's direct booking that you can't put.... You could add a fee. Now, what I meant to say is that usually we say, for example, with Price Labs, what we hear a lot of people say, you know, Price Labs will generate the pricing and the PMS, and then you can send this to different channels. And for example, on Airbnb, you're going can add a 3% to 12% markup. Same for booking sites and then on your direct website, just push the prices straight and that's what you got. And a lot of property managers have been talking to say I don't. Yes, I do this, but I also add a markup to my direct website like this is like 5%.

Thibault Masson
That's pure margin for me. And there's a property manager that's a lot of money I can make. Right. So I was so it really made me think the whole thing about direct booking being just like about being cheaper by essence. No, it's you can be you don't have to be. You can take commissions. There's different ways even because you have to fuel. You have to pay for your own marketing team, your own marketing expenses if you're going to go that direct. So you have to think about other ways to earn money. And having a fee, for example, enables that. So it's again, it's very interesting, just like the OTAs, you can have dynamic pricing on your website. You can have a fee and then you can really start competing. I think it's also changed the way we do direct bookings nowadays from 2019. Probably.

Heather Bayer
So an interesting point you make about airlines and hotels, because I've seen my behavior change from using Expedia for everything to booking directly, and particularly with hotels, I will always book directly. You know, I found a chain of hotels I really like. I've got their loyalty points. I will go direct and book with them. Where do you see the loyalty factor in vacation rentals? Because it's a little bit more challenging to approach.

Thibault Masson
Yeah, it's a very good point. It is challenging because I may take an airline several times a year. I'm not necessarily going to the same place several times a year. I may not even come back next year to the same location destination, so may not come back and stay with you again. And people want to, you know, people want more and more change. So it's that's what we see as well. So loyalty is very hard. But it does not mean that everybody, like fewer people are coming back to the same destination year after year. But some people are coming back, right? So what are you doing to capture these people?

Thibault Masson
For example, in Saint Barts, what we do, we still have this big Instagram account, one of the biggest on the island, and we target people who are fans of the destination, because we know the fans of the destination by essence are more likely to come back, right? So I'm going after these people because they're the ones I'm going after.

Thibault Masson
So you can do loyalty, right? But it doesn't have to be loyalty program. It could be like, I'm going to target people who are loyal to the destination and have them come back and stay with me, or try me, because maybe they're not. I can't target just people loyal to my company, but maybe to the destination makes the pool bigger and then can help out. Hopefully. It's a silver lining here. It's not it's kind of tricky. But again, it's something that doesn't work out. So marketing doesn't work out. Bali is something you put in a bucket list, in there once in your lifetime. It was very hard to do. In some markets it still makes sense. You have to find these loyal people loyal to the destination and go after them.

Heather Bayer
I love that because it's something we've talked about quite a lot on the podcast over the years is that destination loyalty and creating a Facebook group? Maybe that is for that destination. And I see so many destination Facebook groups, which, you know, the little strap line on the banner at the top says 'by such and such a property management company', because you can do that. And they've created these huge followings, because they're not talking about their product or their company, they're talking about the destination. But just by that relationship, by being the owner of that group, for a start, they can post whatever they want. I've got my own Facebook group, which I can post whatever I want and I delete a lot of the rest.

Heather Bayer
The other one is something that's just come up recently, Tom Goodwin in the Smoky Mountains - Mountain Laurel Chalets - and they have just started a podcast  called For the Love of Gatlinburg. And I think destination podcasts are brilliant because people who like podcasts and who like to travel are going to listen to a destination podcast, and if that is produced by a specific company, then once again [there's] that direct relationship, and I think it's genius.

Thibault Masson
And to your point, as we talked about finding owners, right? Obviously, if you look like, you sound like being the expert in town, if I'm an owner, maybe I'm going to turn to you as well, because you like, you know the thing, and you're able to bring in guests, right? So it's so good.

Heather Bayer
So we started out talking about co-hosting network, but really gone into all sorts of different marketing here. But, really, what it all boils down to is that it's not.... Maybe I started out thinking, Oh gosh, this is this enormous threat, but having had this conversation, I'm thinking maybe it's not that much of a threat, providing you're willing to work at creating your own brand, trusted brand, and as I say, work at it.

Thibault Masson
Yeah. And again, it makes sense for Airbnb to do this, we all get it. Right? It make sense, you want to retain people, they're struggling. It's a way to have exclusive supply. Why not exclusive property managers? All makes sense, but Airbnb is not the whole world so that's the good news for all of us.

Heather Bayer
And that's a great, great quote to end on. Airbnb is not the world. Thibault as ever, it's always such a pleasure to have you here. I follow your Rental Scale-Up newsletter and really value what you and Uvika will bring to every issue. Read it thoroughly, recommend it all the time. So keep up the good work on that one.

Thibault Masson
Oh thank Heather. It's very good. I will tell Uvika because indeed there's two of us behind this. So it's very important. I'm glad you mentioned Uvika.

Heather Bayer
So no doubt we will we will talk again, hopefully face-to-face at a conference at some point in the in the next year, I'm hoping to get to a Scale event in Europe at some point. And if not, maybe we'll see you on the this side of the pond. So thank you so much once again for joining me.

Thibault Masson
Thanks a lot and thank you all for listening.

Heather Bayer
A big thank you to Thibault Masson for joining us and sharing his expertise on Airbnb's co-hosting platform. He broke it all down for us from what the platform is all about to the challenges and opportunities it brings to property managers. We talked about how property managers can stand out by building trust, creating strong local brands and offering something that goes beyond what Airbnb's co-hosting network can provide.

Heather Bayer
Thibault also shared some great tips on using direct bookings and building destination loyalty to grow your business. My big takeaway, Airbnb might feel like the center of the world sometimes, but it's not the whole world. There's plenty of room to succeed if you're willing to put in the effort and think creatively about your strategy.

Heather Bayer
So thank you so much for listening. Don't forget to check out Thibault's Rental Scale-up Newsletter. It's full of really good advice for anyone in the vacation rental space. So if you enjoyed this episode, be sure to subscribe, leave a review, and share it with somebody else who might find it helpful. Until next time, keep working hard, stay creative, and make your vacation rental business the best it can be. See you soon.

Heather Bayer
It's been a pleasure as ever being with you. If there's anything you'd like to comment on, then join the conversation on the show notes for the episode at vacationrentalformula.com. We'd love to hear from you, and I look forward to being with you again next week.