Businesses Need to Swing Back to True Stakeholders
We have the good fortune to have a winter and summer property that we rent out on occasion. We began renting our place, using VRBO, shortly after buying it in 2011. At that time, we also had our own dedicated Web site to promote rentals, now abandoned. What was good about the timing at that point was that rental Web sites were being aggregated by entities like VRBO. Prior to that point, finding rentals in various parts of the globe was an onerous hit-or-miss task for vacationers. For owners, finding a consolidation point for advertising a property was also a gap. These interests aligned in the marketplace, with VRBO becoming a prominent agent to help overcome these limitations. VRBO is now owned by Expedia.
Yet, today, I am actively looking for a replacement to VRBO as our agent for rentals by an owner. This quest is despite the fact that, as an active Internet user since the beginning, with often more responsive Web interfaces over time, we have seen the benefits of better and more consolidated services. Unfortunately, with consolidation has also come monopolization, and what had previously been useful services to which we were willing to pay a reasonable rent have morphed into higher fees under the new overlord masters dictating to us rules, process, and rewards. We pass on their greed in higher rents and service charges to our renters.
We have been on VRBO for about a dozen years, and have witnessed two trends that we find unfortunate. First, there has been a steady encroachment of VRBO into fees and charges to both renters and owners. While there have been some advantages for VRBO to take on some of the onerous reporting and collection tasks formally the responsibility of the owner, that has also come at a price of fees (never announced in advance) unilaterally imposed. Further, VRBO holds our payments — sometimes received months in advance — until renters actually stay at the property, so VRBO gains rents on what should be our payments, not VRBO’s. In the unilateral arrangement imposed by VRBO, while our older annual fees have decreased somewhat, that basis has been supplanted by per rental fees that have zoomed the total payouts to VRBO. For renters, that has caused inflation in base rents, further exacerbated by additional fees charged to them as renters. To be sure, VRBO has also added new services for which VRBO deserves compensation and a profit. But VRBO unilaterally sets these rates and has chosen not to engage us owners as the supplier of inventory for what is right and fair. VRBO has shifted its role from a facilitating agent to a monopolistic master. Perhaps any unchecked profit-seeking entity would behave similarly.
In changing from agent to master, the VRBO Web site continues to get less useful to us as owners. Rather than consolidate pages (the original design was a multi-tab layout), functionality is now split and segregated across multiple menu options that force rigid but unintuitive work flows. These work flows are geared to direct us, as owners, to answer new qualifying questions about the uses and policies regarding our properties, many of which feel arbitrary and imposed by VRBO, not the marketplace. Aside from temporary pandemic requirements, all of my new property requirements have resulted from mandates by VRBO, and not from renters or local authorities. Further, not once have I been questioned or solicited by VRBO about these new policies or mandatory requirements, nor do I believe have any owners been so consulted, and we sometimes login to our property management Web site that has a new design or layout but without any prior notice or assistance in navigating the new reality. Who is driving this bus?
These same concerns about arbitrariness pertain to other aspects of the service, such as getting Premier status to obtain higher displays on rental listings or other acknowledgements. All criteria are unilaterally imposed by VRBO without input or inquiry. As an example of how one-sided this all is, there is not even a search function under the so-called owner Dashboard to get access to a FAQ or knowledge base without having to poke through unobvious submenus. In what appears to be by design, one can’t get access to a real human online, but also can not get access to useful digital information.
Truth is, from my perspective, we have seen way too much of this across major consumer-facing service providers in the last five- to ten years. My sense is this trend from one of supportive and facilitating agents to one of monopolizing masters has been accelerating in recent times. Like much that seems like it is careening off the rails, I think companies like VRBO may be headed for a comeuppance.
In this instance, we as rental owners are the sources of inventory for VRBO. Once we reached the point of consolidation for central lookup, renters and owners alike lost their ability to engage in free transaction. Yes, the transaction was made more efficient, but the basis of the transaction got “intermediated”, which is just a fancy way of saying hijacked.
There are only two ways to counteract this monopoly. One, we see new competitor entrants that break the monopoly, resulting in price and service competition. Or, two, either the buyers (renters) or suppliers (rental owners) refuse to be intermediated in the way being imposed. Unfortunately, that is nearly impossible without alternative agents.
Thus, here is my request: New entrepreneurs, please look to the manifest opportunities available to enter these markets and provide a fair and responsive agency service. There is no need to screw the pooch when a good walk would do just fine.