A View From The Road Part 3 – Smart Investing in Uncertain Times

December 2, 2020

Xplorie President and CEO Matt Loney hit the road this summer for a road trip across the country in order to see first-hand how the vacation rental industry was changing during the pandemic and to gain some insight on how to best navigate the new industry landscape. Here is Matt’s continued view from the road…

(In case you missed it, check out Part 1 and Part 2  in our “A View From The Road” series.)

In a few previous posts, I shared my motivation for deciding to take a cross-country road trip during these strange, socially-distant times. For me, the virtual Xplorie office and the Zoom calls simply weren’t cutting it. I needed to see firsthand the challenges my clients— and their guests— were facing.

So I loaded up on the hand sanitizer and hit the road.

The Corona Conundrum

As the summer is starting to wrap-up and one particular topic keeps coming up again and again in my meetings with property management company owners and executives— and it involves corporate strategy. Mainly what I hear most often is something along the lines of— I know I need to continue to invest in the growth and evolution of our company… but how do we do that when the future is so uncertain?

The popular, almost reflexive response from salespeople goes something like— Now is the time to double-down! That way, when we come out of the pandemic you are better positioned than your competition to capitalize on all of the new opportunities.

Sound familiar?

Although a tad self-serving— since such a comment is often followed by an explanation of how that investment includes their product— it doesn’t mean these salespeople are entirely wrong.

And while it’s true that— now more than ever— it’s crucial you’re investing in the long-term future of your company, this also doesn’t mean you need to be spending like a drunken sailor. Or that you should be seeking growth simply for the sake of growth. Rather, investments in your company must be more strategic now than ever before.

Set Your Pandemic Priorities

To build your strategy, I recommend that you first list out the areas of your business where you feel you have the greatest opportunities. If available, list the corresponding relationships and/or vendors that can assist with achieving these goals, along with the related estimated cost.

Once you’ve made this list, prioritize it as follows:

1. Investments that advance your core business model should hold the most important spot.  Right now the focus must be on putting more heads in beds— period.

But don’t limit these solutions to only marketing and distribution. Instead, evaluate your business holistically. Determine where you have the greatest opportunity to increase your occupied nights, increase your rates, and/or increase your rental inventory.

A few things to consider:

• Improving your floor plans and listing photos— check out TruPlace
• Magnifying your guest’s experience and adding value— with programs like Xplorie
• Trying a new homeowner acquisition tool— such as Vintory or Propersum

2. Prioritize investments that eliminate or reduce your general & administrative expenses.

3. Focus on the ROI of each and prioritize those with the lowest ratio of cost versus return. Just because you need to continue to invest doesn’t mean that need to invest at pre-COVID levels.

4. Lastly, prioritize investments that solve problems that will continue to exist in a post-COVID world.

Smart and Steady Wins the Race

As the old saying goes, “If you’re not growing, you’re dying.”  The death may be slower, but the end result will be the same. And while it may feel strange to invest in long-term corporate strategy during a time when the future is so uncertain— making smart investments and planning for intelligent growth is more important than ever before.

Someday soon this pandemic will be in our rearview mirror. How we behave now will determine what our business looks like in that near future. It’s time to take an unflinching look at our business model and our industry as a whole and make the brave and strategic decisions we need to thrive.