Today, Online Travel Agencies (OTAs) have become so synonymous with vacation renting that Airbnb has become a verb: Have a property you want to rent out? Why don’t you Airbnb it?
OTAs like Vrbo and Booking.com have also become household names, offering property managers a platform to list vacation rentals and connect with guests. They offer the full package when it comes to streamlining your hosting and booking experience – with everything from advertising, to insurance, to dispute management covered. It makes plenty of sense why property managers around the world are choosing to rely on them.
But Airbnb and the rest of the online travel agencies family are large companies, continuing to make record, multi-billion dollar profits. As much as they’re helpful, they’re businesses designed to benefit from you using them – charging service fees and added premiums which, ultimately, come out of your pocket.
The share of direct bookings soared nearly 50% in 2023 compared to 2022 (report). Today, more and more property managers are choosing to step away from OTAs, giving them total control over their rental properties, and skipping the added fees.
In this guide, we’ll break down all you need to know about direct booking vs Airbnb. We’ll look at the why and the how of making direct bookings happen (as well as how to get more direct bookings) – so you can start running your own investment property with security, flexibility, and total control.
Why drive direct bookings?
Direct booking short term rental properties you own instead of relying on an OTA can completely transform your business. It can lead to better profit margins, more flexibility, and even enhanced guest loyalty.
You can rely on yourself more
When it comes to holiday rentals, unfortunately, the Field of Dreams hypothesis does not apply: just because you’ve built it, guests won’t necessarily come… because they might not know it exists. That’s where OTAs come in. Having your listing appear on one of these websites ensures that your property can be searched for easily, helping you to connect with potential guests. However, this benefit comes with significant costs, such as:
- High commission fees. The commission fees OTAs charge can significantly cut into your profits – sometimes taking as much as 15-20% per booking. It’s worth researching the costs of advertising a property yourself and making a comparison. One thing to note is that building a loyal customer base might mean you’ll reach a point where you don’t need to advertise at all.
- Dependence on OTA algorithms. Using an OTA can help your rental property get noticed – but among the millions of other listings that are active today, you can’t always ensure that yours will appear on the first page of someone’s search. Typically, OTA algorithms will prioritize properties that perform well according to several metrics: like reviews, host status, and cancellation rates. Airbnb rewards Superhosts by prioritizing their listings, but this status can be difficult to achieve. Dynamic pricing algorithms can also affect your property’s nightly rate, leaving you with less control over your revenue.
- Less control over guest communication and experience. OTAs impose several restrictions on the way hosts communicate with guests, which can depersonalize communications and reduce the quality of the booking experience.
You can increase profit margins
In the direct booking vs Airbnb debate – profitability is where Airbnb and other OTAs can fall short. Cutting out the OTA is the same as cutting out the middleman. It typically means more money in your pocket, because you’re free from (hefty) commission fees. With more of your profit coming back to you, you’re also likely to be in a better position to offer competitive pricing to guests – which can lead to more bookings, and even more revenue.
Building brand loyalty and relationships with guests
Want to offer premium services to your visitors, or speak over the phone? If you’re using an OTA, you might not be able to offer this level of service. Airbnb encourages hosts and guests to communicate exclusively through their app – even redacting phone numbers and addresses if guests or hosts attempt to send them.
Driving direct bookings means you can communicate the way you want to, which can help to build organic relationships with guests and trust in your brand. Customer loyalty is a huge boon – bringing in repeat bookings as well as word-of-mouth referrals.
Greater control over pricing and policies
Using an OTA means that your pricing and cancelation policies are subject to their specific business model, rather than being optimized for your business. Driving direct bookings allows for more flexibility on cancelations and pricing, giving you more control over your experience as a host, your relationship with your guests, and your revenue.
Access to guest data
A marketing campaign is a key part of any successful business – holiday rental businesses included. And to run a successful marketing campaign, you need to know your audience.
Stepping away from OTAs and driving direct bookings means that you can collect information from – and better reach – your guests. It also opens the door to email marketing campaigns, which can take your business to the next level.
Eight ways to drive direct bookings
Moving from an OTA to direct bookings – or starting from scratch – certainly doesn’t happen overnight. But with the right strategies, you can build a sustainable booking flow from the ground up – without needing to depend on an OTA. Here’s a step-by-step guide to show you how:
1. Build a professional vacation rental website
First of all, your listing needs a home: AKA, a website. Your website is the first stop for potential guests, which means it needs to highlight your property’s best qualities, show guests they can trust in your business, and provide a safe and easy way to book a stay.
A recognizable and well-known OTA platform can help customers to find you, and trust you. They probably already know what kind of experience to expect when they book an Airbnb. Direct booking website strategies (like branding, for example) therefore need to consider how you will build trust in your new business.
There are numerous free and paid website builders out there that you can use to host and customize a website: WordPress, Wix, Squarespace, or specialized vacation rental platforms like Lodgify or Hostfully are all great options. You don’t need to know how to code to use them either – they’re designed to be simple to use, even for beginners.
Once you’ve picked a website builder and host, you’ll want to ensure your website ticks all of the following boxes before it’s up and running:
- High-quality photos: Showcase your property’s best features by uploading professional images.
Detailed property descriptions: Highlight the amenities your rental has to offer, any nearby attractions, and the things that make your property wonderfully unique. - Online booking calendar: Make sure that guests can clearly see when the property is available, and set up a booking system that is automated and easy to use (many website builders will offer a booking and/or calendar feature).
- Guest reviews: Make sure to include reviews from previous guests. These are crucial for building trust, and they can also help to showcase the positives about staying at your property.
- Clear pricing: Be transparent about costs, making sure to include any additional fees (such as cleaning fees) that guests will need to pay when they book.
- Contact information: Provide an email address and/or a phone number to make it easy for guests to reach out to you directly.
When it comes to design, make sure your website is easy to use, clear, and inviting. You may also want to consider using particular colours and themes that guests will come to associate with your brand. Check out our top five marketing tips for direct booking websites for more.
Now more than ever, people are making bookings on their phones – which means your website must be mobile-optimized. Most website builders will give you an option to see how each page looks on a desktop screen and a mobile screen before it’s published – so make sure to check that everything looks the way you want it to on both before you go live.
2. Implement a robust SEO strategy
Search Engine Optimization (SEO) is key if you want to lead guests to your website. Put simply, SEO concerns the strategies you can use to help your website rank higher in people’s search results. When someone types honeymoon vacation rental into a search engine (like Google for example), websites that use this exact phrasing are going to appear before others. When you’re creating your website, using popular keywords and phrases that the algorithm prioritizes can help to ensure your website appears before competitor sites.
To do this, start by researching high-ranking keywords localized to the area of your vacation rental property. Then, start incorporating them into sections of your website, such as your property descriptions and metadata.
Running regular blog posts is a helpful strategy for incorporating even more SEO keywords and increasing your visibility. To save yourself time, you can plug keywords into tools like ChatGPT or Gemini and instantly craft compelling, SEO-optimized content.
3. Leverage social media marketing
To ensure your listing reaches as many people as possible, it’s essential to market it to a number of audiences. And not every audience is in the same place. Advertising on social media platforms like Instagram, Facebook, and Pinterest can help you to reach Gen Z customers.
Unlike millennials, who are more likely to use Google to find a vacation rental property, members of Gen Z are increasingly using social media as their primary search engine.
For successful social media ads, use visually appealing images and videos that highlight the best of what your property has to offer. Several platforms offer advanced photo and video editing tools, as well as analytics tools that can help you track audience engagement with your posts.
4. Use email marketing for guest communication
A key part of a solid marketing strategy is an email marketing campaign. Start by collecting customer emails through your website, and build a list to stay connected with past and potential guests.
Sending targeted communications that include exclusive offers, local events, or seasonal promotions can encourage return guests and provide an incentive for new ones who might still be undecided about where to stay.
For a foolproof strategy, utilize guest communication apps like Mailchimp, Hospitable.com, Breezeway, ActiveCampaign and more to automate the process and even reflect on analytics.
5. Content marketing and blogging
Create valuable content about your destination and local attractions to attract prospective guests. For instance, a guide to family-friendly activities or a list of the best restaurants in the area can drive traffic to your site. Repeat travelers often return to familiar destinations, making content marketing an excellent way to stay connected with guests’ interests and stay in the forefront of their minds.
6. Offer incentives for direct bookings
Encourage guests to book directly by offering perks like discounts, early check-ins, or late check-outs. Highlight these benefits prominently on your website and social media.
7. Partner with local businesses
Collaborate with local restaurants, tour operators, and attractions to cross-promote services and expand your audience. Offering package deals can make your listing that bit more appealing and luxurious.
8. Run paid advertising campaigns
Consider running targeted ads on Google or social media platforms to reach your ideal audience. Use location-based targeting to attract guests searching for accommodations in your area.
Make direct bookings safe
Using a short term rental direct book strategy requires careful planning to ensure your guests’ and your security. Here are the things you’ll need to consider to make direct bookings safe:
Guest screening
It’s hard to know who’s really coming into your home when the booking process is totally online. Even though most guests will be clean and respectful, there’s always a chance that the person who books your vacation rental property is one of the anomalies who won’t be.
If you end up hosting a problematic guest without realizing it, disruptive parties, property damage, and even illegal activities can result. These can be costly, traumatic, and even grounds to shut down your business entirely.
That’s why knowing a potential guest’s track record is crucial – not to mention having a way to ensure they are who they say they are. Guest screening – which can involve background checks, guest verification, and reviewing references – can help safeguard your property and offer you peace of mind. It’s your first line of defense against potential issues like property damage, parties, or fraud.
Take a look at these common vacation rental scams to know more.
Including guest screening as a mandatory part of the booking process also adds a level of professionalism to your business, which is particularly important for building guests’ trust. Truvi’s guest screening tools can make this process streamlined and stress-free.
Damage protection
Accidents happen in rental properties, and they can have serious consequences that affect your business. Something as small as clogged plumbing can lead to burst pipes, flooding, and water damage – which all come with hefty repair costs and may put your property out of commission for weeks or even months. Therefore, insurance against damages is crucial to ensure a vacation rental business runs smoothly.
Some OTAs, like Airbnb, offer built-in damage protection. Airbnb’s AirCover for Hosts provides up to $3 million in coverage for damage to your property or belongings caused by guests, as well as $1 million in liability insurance for bodily injury or property damage to others.
But you’re stepping away from Airbnb. Direct booking vacation rentals means you’ll be without OTA insurance, which is why it’s crucial to set up third-party protection against damages.
Specialized rental insurance providers like Truvi provide comprehensive damage protection services, which can be tailored to you. You may want to include some or all of the following as part of your booking process:
- A damage waiver: Charge guests a small, non-refundable fee as part of their rental agreement, which is put towards potential accidental damage. Pick a fee amount that works best for your business, and Truvi can facilitate the process for you.
- A security deposit: Collect a fully refundable deposit from guests when they book to cover missing or broken items, excessive cleaning fees, and other costs caused by damages during their stay. This amount is held by Superhog in a trust account and will be refunded to guests if they do not cause any damages during their stay.
- An insurance policy: Adding comprehensive insurance can add an extra layer of protection, which can be helpful for more expensive damages that aren’t covered by a security deposit or damage waiver payments.
Payment processing
When taking payments from guests, security is a must. Several payment gateways like Stripe, PayPal, or Square allow you to accept and manage online payments safely, and many of these can be easily integrated into your website.
To protect yourself against potential fraud, read up on the protections and policies offered by different payment processors. Look for options like encryption, multi-factor authentication, real-time alerts, address verification, and dispute resolution services.
When you set up a payment processing system, you’ll also want to make sure that it complies with worldwide Payment Card Industry Data Security Standards (PCI DSS), which impact how credit card information is processed and stored.
Doing your research and opting for a reliable payment processing service can help to protect you, your guests, and your business.
Taxes and legal compliance
OTAs typically handle taxes and compliance by automatically calculating and collecting local taxes (like VAT, city taxes, and occupancy taxes) from guests when they book. They may also help with documentation by keeping tax records and making it a requirement for hosts to upload licenses or permits before a listing goes live.
For property managers driving direct bookings, tax and legal compliance are your responsibility. Failing to comply can lead to fines, and even business closure, so it’s important to do your research and make the necessary arrangements (such as applying for a short term rental license) before you start operating your business.
Communication and guest support
The way you communicate with guests can have a substantial impact on their experience and how they view your business. Prompt, professional, friendly, and on-brand communication goes a long way when it comes to maintaining positive relationships with guests and making the booking process clear and stress-free. Providing clear arrival information to guests before their stay is crucial. Follow-ups afterwards can also be a way to encourage return guests and get important feedback to help you improve the way you run your business.
Direct bookings: final thoughts
By stepping away from OTAs, you’re in control of your business – from pricing and insurance policies to advertising and customer relationships. With plenty of professional third-party tools to help you fully customize your website, booking process, and marketing campaign, direct booking vacation rentals gives you the freedom to grow your business into what you envision it to be.
