Booking.com: The New Guy in Town

Posted on November 3, 2017

Do you remember those booking dot yea commercials that used to make you laugh? With 21 years of age, booking.com is one of the oldest and most popular travel sites around. Before getting bought out by The Priceline Group in 2005 they were a hotel-booking behemoth.

At one point they had listings of over a million properties across 228 countries and territories. Then all of a sudden in 2014 they made a shift and begun focusing on vacation rentals with the launch of their dedicated vacation rental website villas.com.

Many expected villas.com to be serious competition for companies like Airbnb and HomeAway. Despite villas.com growing to over half a million listings it was quietly shut down in 2016. All listings were then put on the mother site, booking.com.

Booking.com As Of Today

Booking.com currently lists over 837,000 vacation rentals. And while that number is still less than Airbnb’s and HomeAway’s more than 1 million vacation rentals, it’s the growth that makes booking.com worth your attention.

It took Airbnb and Homeaway 10 and 12 years respectively to get to those numbers. Meanwhile booking.com has gained over 800,000 listings in only 3 years. What does that tell you?

And while the numbers are impressive, they don't tell the whole story. What's it like to use booking.com from a host perspective? Let’s take a closer look, starting with the pros and then the cons.

Pros:

  • Booking is simple: You can book instantly. No inquiries, haggling, or asking for special treatment. Booking comes in, then it’s confirmed, and done.
  • Rates are flexible: You can easily adjust the rental rate anytime you want by clicking on the calendar. Whereas other sites force you to set and stick with “seasonal rates”.
  • They give you helpful tips: Little hints like “37% of travelers in your area travel in groups of 4 or less. Or "do you want to offer a discount for smaller groups?” make optimizing your listing for your local demand effortless. Now that's how you become a better host!
  • Epic support: Even if you don’t have a full-time partner manager like we do, (Hi Julia!) Booking.com's support is truly epic. They have the best trained and friendliest support of all the rental platforms hands down.

Cons:

  • It feels like a hotel site: Their setup isn't vacation rental friendly. Questions are clearly copied from a hotel listing and don’t always make a lot of sense for vacation rentals.
  • Lack of description options: There are no options for individual descriptions beyond the title of the listing. Definitely a carry-over from hotel listings, which is honestly them being lazy.
  • No payment solution in the US: They’re the only platform that doesn't provide payment services. You’ll need to charge guests when you use Booking.com. All they do is provide you with the credit card details.
  • Bugs galore: From messages failing to deliver to fees not saving, there’s room for improvement on the code front.
  • Host cost: The 15% commission in the US (it’s less in other countries) is by far the highest among the rental platforms. When you add that to the taxes you may or may not have to pay as a host, your profit margins definitely take a hit.

Is The 15% Commission On Booking.com Too High?

Booking.com customer service symbol

While 15% does sound high, it's actually about the same on competing sites as well. Sites like TripAdvisor, HomeAway and Airbnb all charge fees to both the owner and the traveler.

In Airbnb’s case, it’s 6-12% for the traveler, and 3% for the owner, which brings the fees to 15% in some cases. What distinguishes Booking.com from its competition is all their fees get paid by the host. Travelers don’t pay any fees at all.

Now I want you to think about that. Because if you list your property at the same price as on other platforms (which you should, according to their clause on rate parity), you should receive more bookings from Booking.com than any other platform.

Side note: Not having to pay up to 12% in booking fees seems pretty attractive from a guest perspective.

One more interesting fact you should know about is how both guest and destination locations influence the popularity of Booking.com as a vacation rental platform. More than 65% of Booking.com's bookings come from the Middle East, while only 10% come from the U.S.

On a related side note, 50% of the bookings for our properties in Europe (Switzerland) come from Booking.com

How Will Booking.com Perform In The Long Run?

Booking.com's parent company generates hundreds of millions in profits every year, which means they've got plenty of cash to throw at the ever-growing vacation rental market.

But with Airbnb's $30B+ valuation and HomeAway now being part of travel giant Expedia, their competition is in a similar position. How will Booking.com perform in the long run? Only time will tell. One thing's for sure, they’re not going away anytime soon.

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About the Author:

Picture of Markus
Proud father and husband, humble leader. Currently revolutionizing short-term rental management with GoNitely. Living in beautiful California close to San Francisco.

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