HomeAway to introduce new traveller service fees
In the second quarter of 2016, HomeAway, newly acquired by Expedia, will be introducing new fees for guests / travellers across its network who book properties through the HomeAway checkout marketplace.
CEO Brian Sharples said in November 2015 “Today we’re announcing business model changes, including the addition of a traveler service fee in mid-2016, which will dramatically change our ability to compete and thrive in the coming years”
“Better monetization will allow us to accelerate revenue growth, but most importantly will provide more resources for an even better product and service experience for our owners, property managers and travelers.”
It will be included as part of the first payment by credit card and will be refunded if the booking is cancelled.
“Traveler service fees are commonplace in the travel industry, and based on research, we do not anticipate that a service fee will be a meaningful deterrent to travelers wanting to book your property” say the vacation rental leader on their website.
Owners on a pay-per-booking will see commissions reduced from 10-8%.
Comparison: Airbnb charges guests booking fees of 6-12% and charges hosts a 3 % commission.
What is the fee?
The fee will be applicable to all pay-per-booking listings and owners with subscription that enable online bookings. It will depend on the overall cost of the booking but will range on a sliding scale from 4-10% of the total booking cost. The lower the amount, the higher the percentage fee will be, with the average expected to be around 6%.
How will the traveller see the service fee?
The service fee will be included in the ‘total’ booking price but guests can see a line-item on your more detailed price quote.
Moving towards 100% online booking?
HomeAway also encourage owners to use online booking to avail of their ‘best match’ facility. The company also states “…when your traveler checks out through HomeAway, they become eligible for enhanced protections and services, improving their booking experience through increased peace of mind“.
How are owners reacting?
Across lots of forums, owners on a subscription based model are unhappy about the additional cost to guests. Many feel that if they do not want to adhere to the ‘Book It Now’ online payment implentation (and enable the traveller fee), their property will plummet down the search listing results. The other main bone of contention is that lower-priced properties are being more heavily penalised than higher-priced ones.