Homeaway Rolling Out Tiered Payments

HomeAway.com indicated recently that they are in the process of rolling out "tiered payments" for vacation rental owners. The concept is that owners will pay higher fees to appear higher up the listings on the page. This approach is currently in beta testing on Homeaway.com and will be gradually rolled out in the future to Homeaway's sites globally.

Price-based tiered listings are not new. They already exist on HomeAway’s VRBO . Other sites, such as Vacationrentals411 offer free basic listings, but you can appear higher in their listings by paying for a "premium" listing. Also, many sites offer the ability to pay a premium listings on a short term basis (e.g. for featured listings for a week or month).

However, Brian Sharples, HomeAway cofounder and CEO, indicated that vacation rental owners generally would have to pay triple the normal fees to get their listing to the top of the page.

Given that Homeaway is already one of the more expensive sites, is this really practical?

Well, maybe for luxury villa owners, which rent for thousands per week, this might represent good value and a way to stand out from the crowds of more ordinary vacation rentals listings.

On the other hand, many vacation rental owners on the large sites such as Homeaway already feel that they are lost in the crowds and might be tempted to switch to other sites where they can find it easier to be noticed.

Homeaway may also find it harder to attract new owners to list their vacation rental property, since these owners will be reluctant to commit to paying for premium listings up frontand the results from standard listings will not be as good as they have been. (On the other hand, I know that some vacation rentals sites actively promote new or expiring listings, particularly during trial periods, to increase visibility and enquiries.)



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