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The average holiday rental host spends hundreds of Euros every year to advertise his property on classified ads websites, with no guaranteed return from his money. He spends hours on the phone every week with potential tenants that enquire about his property, often for periods that are already booked. When he does get a confirmed booking, he has the unpleasant task of collecting money himself from the guests.
The process is very difficult for guests as well: they need to call an average of 8 rentals before finding one that is suitable and available! They then need to make a risky payment to an individual host, without knowing what happens if something goes wrong.
Holiday rentals are often nicer than hotels, and almost always better value for money: you get more room, more facilities, great locations and you can stay together with your traveling companions. So why is it so difficult to find and book them?
HouseTrip.com launched in mid-September and has already gained the confidence of hundreds of holiday rental hosts and guests.
Hosts list their property for free and then manage the whole rental process through the site: they simply sit back and watch bookings coming their way. When they accept a booking, the guest’s credit card is automatically charged and their calendar updates itself accordingly. If a guest cancels his booking, the money is automatically distributed according to the host’s chosen cancellation policy, and the free dates can then be rented out again.
HouseTrip is also much easier for guests: they can easily find the holiday rental suiting their needs, browse reviews from pasts guests and read answers to questions commonly asked about the property. They then securely pay through the site, knowing that they are protected by HouseTrip’s cancellation policy if anything goes wrong.
In addition, HouseTrip proposes other fun and practical features to its users:
Auctions: hosts can auction certain dates in their property. It typically makes sense during periods of high demand for the location of the property or when the host wants to advertise special reduced rates. Auctions work in a classical way: the highest bidders win the stay.
Groups: they allow hosts to market their space to guests with an interest in particular types of space, host or location. This can help to create a feeling of trust through mutual connection and affiliation. Groups also bring together seemingly disparate accommodations into neatly assembled collections.
HouseTrip has a commission-based revenue model: it typically takes 10% on the transactions that happen on the site. This is a pretty big revolution in an industry overwhelmingly dominated by classified ads website: HouseTrip’s ambition is to lead the shift of the industry to a « pay per booking » model. This model would allow for a standardization of the industry towards a future that resembles the state of the online hotel industry today. Holiday rentals owners have many additional benefits to adopt such a model: from guaranteed results for their money to analytics data on their bookings (since the transactions are handled through the site).
As its entry market, HouseTrip chose to concentrate on 3 cities: Paris, Berlin and London. They were chosen because of their importance in terms of inbound tourism. Within 2 months HouseTrip managed to gather more than 900 properties in its entry markets. As soon as a city gathers enough properties that it constitutes an interesting and varied offering, HouseTrip focuses on generating bookings. This is mainly done via search engine marketing, affiliate-like distribution and PR.
The company HouseTrip SA was formed by 5 co-founders of 5 different nationalities (French, British, German, Swiss and Chinese) and backgrounds that started the project in the first quarter of 2009. After raising a first round of capital from business angels in May, they developed the website until its release in the start of September. Shortly after, they gathered a second round of financing in order to finance some of the marketing activities they had planned. HouseTrip’s investors, advisors and board members include key individuals in the travel industry and the start-up world.
Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.
