Sure, we’ve all been there, making our websites slicker than a greased otter in hopes of boosting your conversions. (And we build some really slick vacation rental websites here at ICND.) But here’s the kicker: it’s not just about how snazzy your site website looks or runs. Nope. It’s a whole world of external factors playing puppet master with your conversion rates. Factors you may haven’t even thought about!

“When comparing YOY conversion rates, it’s never apples to apples. So many factors dictate how well you convert, even with the best website on the planet. “

Paul Hanak (that’s me, 20 year SEO veteran and 15 year vacation rental marketing expert)

Let’s warm up with an easy one.

1. Who’s Booking Your Rentals? The Surprising Demographics

Picture Hilton Head Island, where the over-45 crowd isn’t just a majority—they’re practically the whole audience, making up over 80% of guests. And here’s the kicker: a whopping 30% of these folks prefer old-school phone bookings.

It’s extremely rare a client has a fully functional call tracking system that can track conversions from different sources. They are either expensive or time-consuming to monitor. That leaves with a gap that isn’t bridged by an online conversion. Sure, they may be looking online, but then finally call to talk to that “real person”, thus making it seem like your PPC or social media efforts didn’t yield that result.

To top that off, demographics are constantly changing. Gone are the days where grandma and grandpa rent the same house in the OBX for the entire family, each and every year. Everything is shifting.

Action Item: When we do have clients with advanced tracking, we are able to attribute that PPC, social media and other forms of traffic contribute to about 30% more than booking values attributed in Google Analytics.  Just something to keep in mind. 

2. The OTA Dilemma: Finding the Sweet Spot

Now, let’s dive into the murky waters of OTA vs. direct bookings. It’s a classic showdown, right?

“How much inventory should you give the OTA’s?”

But here’s the twist: shifting too much inventory to AirBnb or VRBO can actually nibble away at your direct bookings. It’s not like your properties are coming off an assembly line. There is only one, and once it’s booked, it’s booked. With the rise of OTA popularity, it could be hurting your on-site conversion rates because you have less inventory.

You may ask then: “Well, I’m getting the booking, why does it matter?” Two main reasons I can argue here.

• You’ll be losing brand loyalty (or the chance for it anyway) for that potential repeat guest to return in the future.
• Your website’s numbers look bad!

We’re talking about a delicate balance that can significantly impact the lifetime value of your guests. And with returning guests hovering around the high 30s percentage-wise, it’s a balance you can’t afford to ignore.

Action Item: All in all, make sure you are looking at your booking pace and percentage of bookings for all sources when comparing year over year. 

3. Price Wars: The Silent Conversion Killer

This one is simple, yet, achieving desired results is complex. – something all property managers have to worry about. If your 3-bedroom rental is pricier than the Joneses’ down the road, guess where guests are bunking? Pricing isn’t just about staying competitive; it’s about being compelling. Nail your pricing strategy, and watch those bookings roll in!

On the contrary, you may have the argument though of “but my place is soooo much nicer than my competition.” That may very well be! However, the number of people looking for a good deal for a vacation accommodation far exceed those who are willing to pay for quality (or even understand what really goes into quality).

Action Item: You have to do your comp homework constantly. With dynamic pricing strategies becoming more standard, it's easy to get left in the dust as the season and demand changes.

4. Timing is Everything: Early Bird Gets the Booking

Let’s take this scenario. If you publish your 2024 rates in August 2023, you will get more advanced bookings vs if you published them in November 2023, thus throwing off the numbers when you are comparing your February 2024 month vs February 2023. YTD pacing for future bookings is an important metric that may slip a property manager’s mind when they see their conversion rate for February 2024 is down comparatively.

When in fact, their future bookings on record are up! Less homes to choose from. Less availability. When it comes to booking pace, timing isn’t just everything; it’s all the things!

Action Item: When people start asking about staying again next year is when you need to have rates for next year.  We see many property managers wait until after their busy season (sometimes only a couple months before busy booking season!) to publish rates.   Get them out early! Get people on the books. Get them committed, and worry free without it dangling over their heads.

5. Speaking of availability…

This is probably the factor we see the most on a regular basis, especially as last-minute booking season approaches.

If you are full, people aren’t booking.

It really is that simple. If you paced way ahead this year and only have a few houses available, of course your conversion rate will go down! You don’t have what everyone is looking for (and have already booked). Just one of those many factors.

Action Item: Compare you future occupancy percentages vs the what was on the books last year. It may clue you in as to why people aren't converting. 

6. Site Metrics: Beyond the Surface

Hovering between a 0.4% to 0.6% conversion rate might seem decent (and that’s kinda standard to look out for) but let’s peel back the curtain. Think about what a conversion rate is.

Number of bookings / Number of People visiting the site.

However, just because you have more people, does NOT mean you have more bookings. Not all traffic is created equal.

Here is a small list of traffic sources that could skew your conversion rates:

• blog posts that get a lot of traffic, but no conversions (Top 5 Area Ice Cream Shops)
• if the website has a real estate division (or even if the company has an external real estate website and people get to the rentals one first)
• large social media influence and/or ads being served (billboard effects vs direct conversions)
• Traffic sources vary by conversion rate. Strong organic ranking for generic keywords? If you have inventory, good conversion rate. PPC campaigns blowing money? Even with inventory, bad conversion rate. This is also true for referral sources. If you invested in a website advertising venture and they are driving alot of traffic to your site, but no bookings….that skews your conversion rate.
• outside advertising referrals (chamber of commerce traffic) -internal email blasts (list size & quantity over quality)

Action Item: Look at each traffic source individually and analyze how those users behave. Don't just look at your website's conversion rate as a whole.  You could have a bunch of amazing blog posts that are getting alot of traffic and publicity, but no bookings, and that's perfectly fine! Just understand what goes into a conversion rate when it comes to your traffic sources.

7. The Tracking Conundrum: Navigating Analytics Anarchy

Oh, tracking tracking tracking. While I don’t have an official count, it seems like 1 in every 8 clients we onboard, tracking wasn’t set up correctly in some way shape or form. Of course, we fix it for them! The correct data is what you base your future marketing decisions on! Unfortunately, we can’t fix the past though. All that data that was pushed to Google Analytics from your website will forever be skewed. So now, when you look YOY, you are comparing correct to incorrect. From improperly installed analytics to the infamous GA4 “thresholding,” getting a grip on your data is like trying to catch smoke with a net. It’s messy, it’s frustrating, but it’s absolutely crucial.

Action Item: If your agency figures out your Analytics wasn't installed correctly, make a note of it on your calendar for NEXT year, so you know when it was fixed and what you are comparing isn't apples and cranberry juice. 

8. External Forces: The Unpredictable Wild Cards

And then there are the wild cards: red tide, hurricanes, the sudden appearance of new competitors, the sudden appearance of new inventory on the market, the AirBnb/VRBO saturation. These forces can wreak havoc on your conversion rates, turning what was a steady stream of bookings into a trickle. But here’s the thing: while you can’t control these external factors, being aware of them can help you navigate through the toughest of times.

Action Item: Understand what's going on around you in your market (and even your feeder markets).  These external forces sometimes require a pivot in pricing due to factors outside your control.

The Big Picture: It’s All Connected

At the end of the day, deciphering the puzzle of conversion rates in vacation rentals is like trying to solve a Rubik’s Cube in the dark. It’s challenging, it’s complex, but oh, is it rewarding when you get it right. Remember, it’s not just about one thing—demographics, pricing, timing, site metrics, tracking, external forces—it’s about how all these factors interplay and influence each other.

Embracing the Complexity: A Call to Action

So, what’s the takeaway? Embrace the complexity. Dive into your demographics, fine-tune your pricing, get your timing down, scrutinize your site metrics, overhaul your tracking, and keep an eye on those external factors. It’s a tall order, sure. But in the ever-evolving world of vacation rentals, it’s the only way to stay ahead of the curve.

Remember, it’s not just about finding a single magic bullet; it’s about understanding and optimizing every facet of your operation.

The road to conversion rate nirvana is paved with insights, adjustments, and, yes, a little bit of trial and error. But with the right approach, you can turn those mysteries into milestones on your journey to success.

Of course, it goesn’t hurt when you have a killer vacation rental marketing company on your side either – on that has years of industry experience, one that doesn’t pull wool over your eyes and shows you both good and bad, one still independently owned just like you, one that has marketing staff that have actually worked in-house at vacation rental companies and understands the biz. Yea, that’s us – ICND!