Converting your vacation rental inquiries into actual bookings is the most important thing you can do to increase your vacation rental cash-flow.
This article will focus on what you can do to convert those incoming inquiries into actual cold, hard cash aka bookings. I will even introduce you to a formula I created "IBCR" (inquiry-to-booking-conversion-rate).
Before you can convert your inquiry traffic to bookings, we know you're concerned with increasing your volume of inquiries first. But we'll leave that article for another day. Suffice to say increasing your inquiries is a more tangible prospect. For example you can take different or better or more professional pictures. You can write more or write better descriptions of your home and it's amenities. Things like that will go a long way just to increasing your inquiries but we'll cover that in a follow up article.
For now, let's improve your inquiry to booking conversion rate. First and foremost, I have to ask and you have to answer honestly with yourself, do you know your current conversion rate of bookings? What I mean is, do you know, on at least a monthly basis, a) how many inquiries you get and b) how many of those inquiries turn into actual bookings? (Keep in mind, you might also think about tracking when inquiries are made in relationship to the time of year they are being made for. In other words, an inquiry made in April may be for a booking date in July).
This mathematical division problem is the only formula you need to know and it will tell you everything about your conversion approach. Without knowing your exact specifications (geographic location, home size, bedroom & bathroom count, amenities, etc.) I can't tell you what the conversion rate should be. But what I can tell you more generally and anecdotally is that 15%-20% is the goal and anything above that means you probably don't need to continue reading this article. For those without a calculator in front of them, if you had 100 inquiries in a given period (let's say 6 months), then you should have 15-20 bookings.
But while that's considered a success, that also means (from our above example) that there's 80-85 inquiries that are abandoning your listing and costing you time and energy (to review the inquiry, respond accordingly), and worse potentially leaving your home open for dates that are otherwise going unbooked. That's costing you money and is an absolute no-no if your home is available and otherwise staying unoccupied during a 'rentable' time period.
In order to improve your inquiry-to-booking conversion rate (IBCR) there are a handful of ideas and themes you should be aware of and employing:
1. Notification and Response.
First and foremost, with most listing sites you can download their smartphone app so that you can receive a notification as soon as an inquiry comes in. You should be set up for this. Literally a text message alert should hit your phone moments after the inquiry is sent. Within minutes of that you should a) be aware of it and b) crafting your response.
Most online listing sites allow you to use a template response so that the only thing you need to do is quick-glance the data that you are sending back to the inquirer to confirm accuracy, or update for additional fees (pet, for example).
Your email template should be simple and to the point:
- a) thank the sender for the inquiry,
- b) confirm the date range they've inquired about is available
- c) indicate your attached quote is for the given date range and party size they've indicated (if it's not indicated you MUST leave open the possibility "the quote could change contingent on additional information to be determined" and
- d) you're available to discuss by phone if they have any questions.
Then you hit send. Simple. You'll also receive the incoming and outgoing communications through the app to your email inbox. I personally store those in a folder in case I ever have to refer back to them for follow up communications. I shouldn't have to tell you how important it is to respond quickly to incoming inquiries. But suffice to say if you're taking a day or longer to respond, you're losing out on a lot of business. I personally don't go more than an hour, and I'd be wiling to bet I haven't gone more than 15 minutes in most cases without responding.
2. Stay In Touch.
Overwhelmingly after the initial communication (as between the incoming inquiry and the response/quote), the dialogue ends. To combat this you should consider following up via phone or email to confirm receipt of your response (sometimes I've indicated there's been problems sending messages/responses through the app and as such I just wanted to make sure they received my quote). You may also be able to tell what is a serious inquiry versus one that appears to be made by an undecided traveler or one that is being sent to a handful of other owners. How can you tell? I can tell most notably based on the language in the inquiry. First, are they speaking specifically about my property? And secondly, did they include the various data points required by the software to even send out the inquiry (name, phone number, email, number of people in party, etc.) The more information they include in their communication to you, the more likely they are serious inquirers. For folks that fit both of these above criteria, I often respond over the phone. They are more likely to convert once you've dialogued with them about their specific stay.
3. The Difference Maker Dialogue
It is during your initial return call that you can learn more about the inquirer's party, about their reasons for travel, how your home would be ideal for them and likewise what the surrounding area will afford them during their trip. For example, our company handles many San Diego coastal homes (Coronado, Pacific & Mission Beach, La Jolla, Del Mar, Solana Beach, Cardiff, Encinitas, Leucadia, Carlsbad, Oceanside). But even for folks traveling from another state, a coastal home (whether it be 3 blocks from the beach or 1 mile from the beach) can still appear to be the same -- coastal. But it's most definitely not. For our clients that have homes 1 mile from the beach we have to promote their home as desirable, or in some cases even more so, than those that are 3 blocks from the beach. So how is that possible? How can we possibly convince a would-be-vacationer that a home farther away from the beach is a better option. Here's just 2 examples of many of how we accomplish this: 1) we highlight the size of the property and especially the backyard/front yard. In coastal communities, the closer to the beach, the less land you get. This is a big sell for families that want outdoor space that's private and open for their children and their guests to play, entertain and generally just enjoy. 2) We highlight the neighborhood. In beachfront or nearby, in coastal San Diego, most neighborhoods are not well lit, have poor sidewalk or no sidewalk, and are usually situated on steep hillsides (to improve the views). We use this to let folks know that this could be problematic if they have children or pets or generally want to walk the neighborhood in the morning or evening. Sign up here if you have questions about how to up-sell your home as we have numerous other suggestions for those homes that are competing with the beachfront (or nearby) properties.
This extra dialogue not only goes a long way to improve the communication and increase the 'touch' you've made with the inquirer but also developing a trust and expertise of your area. This is something that very few owners either know to do, or can do. It goes without saying that offering this level of insight, which can also include local area knowledge (where to shop, which beaches to go to or conversely not go to, where to eat, etc.) is such an advantage over your competitor homeowners that I can almost guarantee you'll double your IBCR just by following this one tip.
In conclusion by taking those 3 steps above, 1) responding immediately to all inquiries, 2) connecting over the phone with your serious inquirers and 3) providing expert information on your home and surrounding area, you should be increasing your IBCR exponentially.
Most importantly, all of these suggestions are free and shouldn't cost you anything but a little bit more of your time.
Finally, this is an objective component of your vacation rental business. You can literally track every component and data metric of this phase of the rental process. To do so, simply export to a master spreadsheet (from the various listing sites) and combine into one worksheet with the following column headings; pageviews, inquiries (date & quality), booking and reservation. You should then be tracking date ranges (inquiry date vs. booking date vs. reservation start / end date). You should be tracking the quality of your inquiries (are they serious inquiries vs. generic inquiries that are probably going out to multiple homes). After a period of time you will have created a data pool that can be relied on to predict future rental activity. You can also use this data to improve or otherwise amend your strategies.
If you find that you don't want to be responding to every inquiry, or you don't have the time to promote your home or surrounding area over the phone, let us know and we can help. Contact us today and let's discuss what we can do together to increase your return and decrease your time and energy.