The short-term rental industry has hit its stride, so much so that even with economic uncertainty, guest demand continues to top previous years - up 17.9% in 2022 compared to the same time last year (
AirDNA
). With rapid growth comes new life in tech platforms looking to support property managers in their eternal quest toward meeting guest demands smoothly and consistently. But increased competition can amount to added pressure for tech companies trying to keep their heads above the parapet in an ever-expanding market.
Making sure hospitality tech platforms develop sustainably and consciously from the beginning is a win-win approach; not just for their own benefit, but also for the greater good of the industry. Offering long-term reliability in resources that property managers can depend on will help nurture a solid, loyal community of followers, and may in turn increase the likelihood of them investing in tech.
With sustainable growth comes the opportunity for hospitality tech providers to acquire industry expertise in the areas in which they’ve honed their craft. Those who can weather the storm of outside market challenges can act as a real source of industry knowledge and advocacy over time, helping the industry as a whole to survive and flourish.
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With the benefits of growing sustainably in mind, there are a number of ways that hospitality tech companies can make sure they stay in the industry for the long-haul, in an increasingly saturated and economically challenging climate.
Talk to potential customers
Believe it or not, it’s very common for technology providers to build a solution to a problem that doesn’t actually exist. Speaking with as many hosts and property managers as possible before getting started is therefore a non-negotiable for building a truly valuable hospitality tech product. Find a problem or pain point, then build the solution.
Lead with quality
Robust, well-oiled hospitality software doesn't take shape overnight. Building with quality in mind from the beginning is essential to get the product just right over time. This approach can be maintained by focusing on solving the problem at hand, as opposed to creating all-singing, all-dancing features quickly that are less valuable to the end user.
Fund with integrity
Venture capital funding can propel tech companies looking to grow quickly. However, pursuing the VC funding route isn’t always the best option where risk is concerned. My business partners, Tadej Murovec, Andy Shipman and I decided to go down a different route with Uplisting. We built the business organically for the first five years, before securing funding. While now is not a great time to look for VC funding (valuations have dropped by up to 50% and investors are wary), it’s always a good time to build a sustainable business with the aim of becoming profitable.
Increase revenue per customer
When recession looms, how can tech solutions prepare and survive? Most players in the short-term rental space have experienced huge growth over the past 18 months, but it's important to keep one eye on the risk of a recession. With this in mind, Uplisting, for example, is working on added-value features to increase our average revenue per existing customer, instead of focusing solely on getting more customers through the door.
Keep members at the core of decision-making
Solving customers' challenges is just as important as knowing which customers and feedback to listen to. It may seem counterintuitive, but we say "no" a lot. It’s impossible to build a solution to meet everyone’s needs 100% of the time. Startups without a product background often don’t understand the need to focus on listening to the right customers and digging deeper into understanding what the challenge actually is.
Often it’s not what they have asked for. If you’ve ever used a platform that is extremely difficult to navigate, you’ll understand what I mean. Our job as technology providers is to offer an easy-to-use, reliable and valuable product. Create features that help save members time and increase their revenue. It’s that simple.