In the world of contactless check-ins and AI plugins, vacation rental veteran urges the industry to not forget the basics: Cleanliness and safety.
James Olin may be old school, but he’s no Luddite. He knows dynamic pricing and contactless services are the order of the day, but he still thinks safety and cleanliness are the most important elements of success in the short-term rental industry.
“You can use all the technology you want, but what will have people coming back is if the room is clean and smells nice.”
Olin got into vacation rentals in the late 1980s, and his major break was in 1992 when he ran Abbott Resorts. He also headed ResortQuest as its CEO from 1998 to 2004 and took it public. From there, he went on to join Sterling Resorts as the managing partner. He now runs C2G Advisors, which is an M&A consultancy for short-term rental and vacation rental businesses, as its founder and CEO.
Skift spoke to Olin to discuss his perspective on how the industry has changed in the past three decades and where he sees it going.
Below are the edited excerpts of what Olin said:
On Changes In the Vacation Rental Industry
There really were two major changes that occurred in the vacation rental industry that changed everything — and Airbnb was the second one. The first one was technology. Just a good old-fashioned computer. When I started in this industry, we had some computers but we didn’t have emails. Our idea of dynamic pricing was when to start spring break each year. But we did everything by hand. And being on site with an office like a hotel was very advantageous.
It wasn’t until technology allowed someone that was five miles away to be able to book the unit and service it that way that the people on site started losing that competitive edge.
When the off-site operators came around, because technology allowed them to, you started seeing Airbnb-style private equity coming into the industry. Before that nobody knew who we were, they thought we were a timeshare — they didn’t get it, they just couldn’t figure us out.
On Discovery and Vacation Rental Distribution
It was a somewhat of an easy industry when I got into it back in 1989 because there was no technology and there weren’t a ton of players in the industry. Distribution was easy for us in the Florida Panhandle region because there were only four or five cities — our target was Atlanta, Birmingham, Nashville, Memphis and everything in between.
We didn’t change rates, we always discounted, and that was it. We did a lot of it with trade where we would go to radio stations and do ads. We did have a database if you want to call it that of past guests and we had a strong repeat clientele. But we did distribution and customer acquisition the old-fashioned way — we gave 25% off if they came back.
We didn’t have email blasts, so we did oversized postcards. We would have the Atlanta Braves night where we threw out the first pitch, and we hired Don Sutton as our representative for four years, because he was an ex-Atlanta Braves pitcher, and everybody knew him.
On Back to The Basics – What the Vacation Rental Industry Has Lost
I think everybody knows what needs to be done, but that doesn’t work for Wall Street. When I was a public company CEO, the guys on Wall Street didn’t want me to talk about our laundry and how we have one of the best laundries you’ll ever see.
So let’s be honest, when we walk into a room, one thing we all do is we breathe in. And we want it to smell fresh.
Forget about all the technology, dynamic pricing and everything else. You don’t want to walk into a room and have it smell musty. I think we use technology as a way to raise money, as a way to promote our industry. The way I think about it is, I go into a McDonald’s, I talk to the person behind the counter, pay them and get a burger. Today, McDonald’s might have a kiosk where I press a bunch of buttons and wait for my burger. Does that make McDonald’s a technology company?
It’s the same with vacation rentals. Are there tech tools that are going to help? Yes. But when you get down to it, the biggest challenge, especially in heavy seasonal markets, is getting labor and ones that will go in there and scrub the floors.
On Lessons From Operating a Public Company
I don’t know if any company in this industry should ever have a public company. I was the first one to do it with ResortQuest. It is almost impossible to manage a company that’s right for your customers, your employees, that is also correct with the way Wall Street wants you to do it.
Wall Street looks at a quarter like a year. And once a quarter is over, it is history. You know, look in the rearview mirror. Well, that’s not the way life is. Sometimes you may want to hold off a quarter and invest in the next one. So maybe it isn’t best that we try to make companies a public entity. Maybe keeping it private is better.
We’re not technology companies. We’re management companies, we manage other people’s assets, and we make people have a good vacation. That smells good.