Direct Bookings vs. Airbnb vs. Agents: Finding the Right Balance for Growth

Why is my occupancy so low outside of December? - This is the question many shortlet operators in Nigeria ask themselves. Increasing occupancy, especially in Nigeria, requires marketing through multiple channels. But which one is the best? In this article, we will take you through the secret sauce of balancing getting bookings from different channels, including agents, websites like Airbnb, and even the secret to getting those commission-free \ bookings directly from customers.

What are OTAs and how can they help you. An OTA or Online Travel Agency is an online site that connects travelers with accommodation, flights, car rentals and even guided tours. For shortlet managers in Nigeria, the top OTAs are Airbnb, Booking.com or Expedia. These sites account for 99% of potential online guest traffic. OTAs are great because they provide instant visibility to a global audience, features like built-in customer support host insurance protection, and, importantly, built-in trust from guests. In fact, “Airbnb” has become such a household name that it works as a bit of a short hand for the entire shortlet and vacation rental market. However, not all OTAs are built the same. For example, Airbnb works best for shortlet apartments, while Booking.com and Expedia are best for boutique hotels or apartment-hotel style properties.

However, there are a few drawbacks for OTAs, including high commissions (typically 12% - 20%), limited control over guest relationships, and strict rules that could lead to your account being disabled with little warning. In addition, for customers in African countries like Nigeria, many OTAs do not handle payments or allow for payments in local currencies. For Airbnb and Expedia, this means you will need a US, UK or EU-based bank account to get paid by the platform. For Booking.com, you will need to remit commission on a monthly basis or see your account blocked. The lack of payment flexibility can definitely be a barrier to some managers and make it daunting to get set-up. If you need help getting set up feel free to book a call with us at Reeka.

In conclusion, OTAs like Airbnb, Booking.com, and Expedia can give you powerful exposure to global audiences, but the high commission, payment limitations, and strict rules make it risky to rely on these platforms exclusively for bookings.

Local Agents are a big part of the shortlet business in Nigeria. So much so, that potential guests often get confused between agents and actual property managers. As many seasoned shortlet operators know, working with good Agents can be a reliable way to fill availability, especially last-minute, but bad agents can be a hellish experience.

Let’s start with the good side; agents are a big part of the business, especially in Nigeria, and can genuinely help you get guests. Nigerians tend to be relationship-based people and like to have someone’s “shirt to hold” in case things go wrong. That added layer of trust and convenience really can make all the difference for people looking to book stays at shortlets, especially the first time they stay at your apartment. There are also many local agent WhatsApp groups, that can help you connect with agents. Working with agents from these WhatsApp groups can be helpful because members typically have a minimum level of vetting.

Now the bad news: typically, agents charge a large commission, sometimes as much as 50%. This added cost typically gets charged to the guest, so it may not affect your revenue directly, but it will also raise the expectations of service guests expect to receive. In addition, it is hard to know who is “legit” because there are no official organizations for shortlet agents. In addition, agents at their core are middleman, so working with them can be highly manual and require a few rounds back and forth to get the booking done.

Is there any way to get the most out of working with agents?

• Work with previously vetted agents. Taking recommendations from other managers or even sticking with agents you have used in the past is a good start.

• If you do have to pay commission, track how much you are paying the agent. This is easy with a platform like Reeka, which is built to track details of bookings even if they happen offline.

• Joining agent WhatsApp groups. Joining these groups can give you direct connections to a more vetted group of shortlet agents

The best option for your business is when guests just knock on your door and book! No commissions, no middlemen, and the ability to build a brand. Direct bookings can be a powerful channel when given a little bit of effort. A lot of new managers can be unsure how to get direct bookings, but a mix of online and offline marketing will help get the word out there about your property. Offline channels can be as simple as printing flyers and going to local businesses, especially those that may have their staff or business partners traveling in periodically. Even places like community centers, recreational clubs, and bars can be good places to share about your new space. Local residents who may have friends or family members coming to the area and are top of mind will help you get bookings. To maximize online marketing channels, growing your presence on social media by posting regularly and partnering with local content creators can be an exciting way to share your property with a broad online audience. High-quality photos and videos make all the difference, showcasing and can help build trust with potential guests to give them comfort to book your property without going through sites like Airbnb or working through an agent.

Direct bookings become even easier when you have the power of an organized calendar with up-to-date availability and a public booking page to allow potential guests to easily book and make payment for their stay quickly. Reeka’s newly launched direct booking feature allows you to do just that. On your direct booking page, guests can see photos of the property, a map with the property location, and amenities, giving them the confidence to book easily with less back and forth.

To maximize occupancy and revenue, property managers will need to find a balance between OTAs, agents, and direct bookings. OTAs are great for international guests, but agents and direct bookings help you serve local customers with direct bookings, providing the most control and the least amount of fees. With Reeka, you can see all your revenue and bookings in one place, giving you the confidence to take in bookings from all channels without worrying about double bookings or having to reconcile revenue from different places. All in all, the healthiest business mixes all three. Don’t be at the mercy of one channel.