The following is an excerpt from a recent Instant Software client newsletter.  To read the full article click here.

——————- ISI Insider Newsletter—————–

ISI Clients are Increasing Booking Conversions with New Integrated Guest Review Service Powered by FlipKey

Instant Software and FlipKey launched an integrated seamless guest review service during RezFest 2008. In less than three weeks since launching, 35 property management companies have successfully begun integrating guest reviews through ISILink. Over 4000 reviews have already posted on 1500 properties with an average rating of 4.32 out of 5. Getting started with guest reviews is quick and easy…and it’s also FREE.

WHY COMPANIES ARE USING FLIPKEY / ISI GUEST REVIEWS

Research shows that recommendations from prior guests have a dramatic effect on booking conversions. According to Compete, Inc., 78% of vacationers say they are significantly more likely to book a vacation home if they can read reviews from past guests. TripAdvisor notes that hotel websites have doubled their conversion rates after incorporating guest reviews into their websites. Why? Because they remove the uncertainty and unpredictability often associated with a potential accommodation.

Not only will guest reviews likely increase your booking conversions, but through FlipKey, you will also increase your marketing distribution. In 2009, TripAdvisor will begin promoting vacation rentals that feature FlipKey reviews, giving you the opportunity to promote your properties to more than 24 million visitors per month.

MANAGE YOUR REPUTATION – NO REVIEW IS A BAD REVIEW

Some property management companies have expressed concern about potentially negative ratings. However, 81% of guest reviews are positive to very positive with an average rating for ISI clients of 4.32 out of 5. In fact, only 4% of guest reviews are negative and these minor cases are critical in establishing the credibility of all your positive reviews. Research has shown products featuring at least a few critical reviews convert better than products featuring only positive reviews. 

To read more click here.

An interesting article came across my desk today highlighting the growing vacation rental market in San Francisco.

Here is an excerpt of the article:

San Francisco has been a mecca for tourists and business travelers for more than a century, and to meet the demand a vital hospitality industry has sprung up. Scores of high-end hotels and corporate apartments, hostels and bed and breakfasts all compete to attract the city’s yearly 16 million visitors and get a portion of the over $7 billion they spend. But in the past few years, with the rise of the Internet’s free market enterprise, the city has seen another sort of accommodation crop up: the individually owned vacation property.”

Cont…

“Indeed, according to a quick and dirty survey of a dozen Web sites which list San Francisco vacation homes, more than 700 houses, flats or apartments in San Francisco are being primarily rented as temporary crash pads. That doesn’t count those properties that exclusively use Craigslist.org as their sales portal.”

For visitors this is great news — especially as hotel rates escalate through the roof. Renting an individual apartment or house can mean a lot more space and luxury for a fraction of the price.

The Good and The Bad:

The emergence of urban vacation rentals is a great win for consumers. Consider, New York City, where average hotels prices exceed $300/night. If you perform a quick search for vacation rentals in NYC you can find accommodations for ~$150/room/night. – a 50% savings boost compared to the average NYC hotel…

I have hands on experience with urban vacation rentals as I used to rent my Boston condo as a vacation rental. Last summer I was able to command ~$1,500/week. Most of my guests left wonderful notes thanking me for the unit and suggesting I charge MORE (true story).

The problem with urban vacation rentals is the increased unpredictability and potential legal concerns. Last summer, most of my guests required I “prove my identity” before they would send me payment. Luckily, I have a number of online profiles that helped.

An additional challenge faced by urban vacation rentals pertains to zoning laws and condo/co-opt bi-laws. Most urban vacation rentals are facilitated via apartments/condos that are accompanied by specific rules/regulations for how an owner/primary-renter is to maintain their unit. In many cases, the owner/primary-renter may be taking legal risks in turning their unit into a vacation rental.

The Urban Vacation Rental market is a real opportunity in cities such as, San Francisco, Boston, New York and Chicago, but there are valid trust and legal concerns that need to be addressed before this segment of the vacation rental market will emerge as a mainstream lodging option. In the interim, it’s great to see the concept gaining momentum and I look forward to helping provide urban vacation rental accommodations via FlipKey.com in the near future.

For the international crowd, renting a vacation property for your “holiday” has been a popular alternative to hotel and resort accommodations for decades. Over the last several years this trend has been spreading across the Atlantic and represents a growing segment of the US travel market.

And it’s not just families trekking for a weeklong vacation at a home rental on the coast. Here at FlipKey we have experienced first hand the growth of urban vacation rentals and the increase in travelers seeking alternative lodging in places not usually associated with vacation rental travel. Our personal rental units here in Boston are fully booked and have been since the Spring.

Maybe you’re planning a trip to Vegas? Why stay on the Strip? OK, we can think of a few reasons – but the rationale of the vacation rental holds true even in the hot desert sun: affordability, unique accommodations with more space, and the opportunity to escape the madness of the hotels and retreat to your own temporary oasis and private pool. Las Vegas Retreats – Castillo Estaban.

As vacation rentals become more popular, we expect inventory to continue to grow in all vacation destinations, not simply beach, mountain and golf locations.

I have been a vacation rental manager for the last six months in hopes of renting my condo during the tourist heavy summer in Boston.

I would estimate 80% of the inquiries I receive via the listing service I use are legitimate guests looking for accommodations. I find many are a bit ‘cheap’, aggressively trying to reduce my (very reasonable) rates, but they are good people for the most part.

The remaining 20% I would characterize as ‘Un-Spam’ – meaning, people that don’t realize they are sending me unreasonable requests.

• A man from Idaho asked me if he could rent my two bedroom condo for one night for himself and 20 of his closest friends. (That was not a typo – 20 friends)
• At least 2 people each week ask to rent my unit on a week that is already clearly booked on my calendar
• A woman from Texas offered $50/night for three nights in exchange to keep it ‘clean’
• A lot of house swap offers

My place is booked for the rest of the year and to cut down on the Un-Spam I have blocked off my calendar, but I continue to get about 3-4 inquiries a week. I don’t see this as a bad thing and more of an illustration of how demand for vacation rentals exceeds supply.

I believe there are some simple solutions to cut down on Un-Spam and I will explore potential solutions in future posts.