Do Vacation Rentals Compete with Hotel Stays?

Just as the workplace became disrupted by the pandemic, leading to a still-evolving situation of some companies returning to the office, others staying remote, and others attempting a hybrid situation, so too hotels and vacation rentals had to adapt during the pandemic and continue to do so. As they do so, they continue to converge in reality and in the minds of consumers.

Workcations

The restrictions of lockdowns and the freedom of remote work drove many to flee — in some cases, permanently — from where they were living. This led to longer stays in some areas that were not used to an influx of visitors. Workcations became a new demand in the travel marketplace. 

While vacation rentals were able to absorb this demand, often without skipping a beat, hotels took a little longer to respond before jumping in by offering extended stay packages and in some cases, renovating some parts of properties to resemble vacation rentals, aimed at the same market.

Hotels have long been used to the idea of “bleisure travel,” which refers to business trips that are on the front or back end of visits, or business trips that include family and friends. The same amenities that have been attractive for that travel have also been attractive for workcations like pools, steam rooms, gyms, and continue to offer a slight edge as they compete for workcation stays that don’t offer similar amenities.

Standardization + Personalization

Airbnb has taken the recent complaints about cleaning fees to heart and has added a feature allowing guests to search for listings showing integrated pricing without a “surprise” cleaning fee that only shows up at booking. 

In addition to pricing, vacation rentals continue to standardize areas like cleaning and check in. Many vacation rentals added more contactless check in options during the pandemic, as did hotels, who also did so to deal with the practical issue of not having enough available front desk staff.

Yet, while these standardizations in vacation rentals have continued, some of the best hosts have continued to use and advocate for small personal touches, whether that’s leaving a handwritten note upon check in or something that the guest really likes in an amenity basket. These little touches can make a big difference in guests deciding to opt for a vacation rental instead of a hotel for their next stay.

Elite Experiences

Hotels have always had prestige properties that travelers love to experience or stay at. Airbnb recently has taken an interesting angle at competing in this space by highlighting historic or designer homes that have been featured in magazines and other outlets. Want to stay in a home designed by a famous architect? That’s an option that can compete with staying at a historic prestige hotel property.

Convergence

Big OTAs like Booking.com often offer vacation rentals, hostels, and hotels within the same search bar. Guests can enjoy the high level of personalization that filters can offer, which can sometimes lead to surprising options that appear at the top of their search, and can sometimes mean offering a choice between a vacation rental and a hotel, both of which have everything a guest is looking for.

Ultimately, vacation rentals are here to stay, and the corresponding moves that they and hotels make to adapt to the market and to each other offer a big win for travelers: more options, more possibilities, more adventures, more memories.

This content originally appeared in our twice-monthly Guest Book Newsletter.