Why it’s Smart to Overpay for Vacation Rental Marketing


I know what you are thinking..

“Did he just say OVERPAY for marketing my VR?” Is he a crazy fool? Why on earth would I do that?

Most people will tell you to spend the absolute least amount you can on marketing your VR. I’m about to turn that school of thought upside down.

Let’s use a fictional example of Owen the Owner. He’s got an average priced 3Br place he rents for $200 a night.

Owen does what most average owners do:
List on one or two sites like Homeaway or VRBO, get a mid-level subscription which costs him $700 a year. Owen can’t believe he spends that much and can’t imagine spending more. After all his place gets rented about 50% of the time and he brings in $36,000 a year in rent. This just covers his mortgage, expenses and brings in a few hundred extra per month. Not bad right?

But let’s do a little math. Let’s say Owen wants to hit 90% occupancy instead of 50%. Let’s also assume 90% is close to the max when you consider change over days, and small gaps in your calendar, etc. 90% occupancy would net Owen $65,000 in rent or $29,000 more than 50% occupancy. Would you spend $1000 more to get $29,000 or even a more conservative bump of $10,000 in bookings which is still a 10 to 1 ROI?

Let’s say you need to spend $2000 extra to hit the max of 90%. Why on earth would you spend more than that?

Even if you are booked…Spend More!

Even if you already have a booked calendar here is why I would spend even more.

1) The more inquiries you have the more power you have to raise prices. For example, if you are at 90% and you raise your prices just $10 a night that’s an extra $3200 a year in profit, more than enough to pay for all of your marketing! It also prevents you from having to discount your place just to get a booking.

2) Your calendar get’s booked earlier and you get the power to take exactly the perfect guest for you. Higher paying, weeklong guests vs. 2 night stays with less turnover. Less turnover means more time saved for you. Time = Money!

3) The more renters, the more reviews! More glowing reviews = more guests! This helps create a snowball effect of demand for your rental. When people see you have 60 great reviews and most others have 10 or 20, you not only make your place more desireable, but also usually get a higher placement on the listing site.

4) Sending your ‘overflow” inquires to your fellow owners. Either take a finders fee or just a friendly swapping arrangement works great. This alone can pay for your extra marketing spend. Let’s say you refer out just $2000 in rents per month, that could be an extra $200 in your pocket, plus the goodwill that comes from that. This goodwill comes from both the renter who you took great care of by recommending a trusted place to stay and of course the other owner who now is more likely to send business back to you! Thus if you are sending out a lot of leads, you will also get a lot back to fill in the gaps in your calendar. Under this scenario we just raised an extra $2400 a year in profits, not even including the value of leads sent back to you.

What to spend money on FIRST?

1) The Top 5 Listing Sites

I highly recommend going all in on these 5 sites: HomeAway, VRBO, Flipkey, VacationRentals.com and AirBnB (which is actually free to list).  And by all in I mean buy the most expensive package that get’s you the most exposure. The exception is if you have very little competition (like 25 or less) in your area. No reason to spend $ to get bumped up since you will already be on page 1. This will get you off to a quick start since you can get all these set up in a matter of hours. This gives you coverage on the most profitable websites in the industry. This should be about $2000 a year or less. Here is something else to consider. Each market is different. You won’t know how each site performs for you until you try it. Use each site for at least a year before making decisions on which ones to cut if any. Track your booking sources so you can review at year end. I’ve seen huge shifts in the number of bookings from one season to the next. Flipkey is hot for a while. Then it’s VRBO, then it’s AirBnB. It’s impossible to predict, so once again, be everywhere!

So why would you want to be on 5 or more different sites? Let’s analyze user behavior. Most renters will do one of two things. The first group is experienced and has a favorite listing site they may have used in the past and simply type it in and being their search. If you are NOT on that site, you have ZERO chance of getting that listing. The second group of people just go to Google and type in the City + what they are looking for and likely land on a major listing site. That is why you dramatically increase your chances by being everywhere!

What NOT to spend money on

There are LOTS of listing sites out there. Even lot’s of “free” listing sites. The truth is most of these lesser known sites are a waste of time and money. While there are some good local or regional sites, do your homework before investing in these other sites. Do this easy test:  go to Google and type in “[Your City] + Cabin Rentals” or whatever term fits your VR. If the website you are questioning is nowhere to be found on Page 1 of Google, you should really reconsider. However I bet you see VRBO, HomeAway, and Flipkey all over that same Page 1. See my post “How I got my VR to show up 9 times on the first page of Google.”  The other test is to see how many others in your market are already listed on that site. If it’s only 3 then I would say buuuuh-bye! Bottom line: There are other good sites beyond the top 5, just make sure you research before spending money.  Please note: I’m speaking about the USA market here, internationally it may be different.

2) Professional Photography.

Next spend $200-500 on professional photos. This is SO worth it, especially if you just spent $2000 on getting massive exposure, you want a great first impression! The difference in bookings between average photos and good professional photos can be dramatic. Don’t skimp on this important step. Note: if you are going to take your own photos, at least go to some classes or get Tyann Marcink’s great guide “Create Killer Vacation Rental Photos” eBook so your photos look professional.

3) Your own website – Another huge source of leads (if you do it right)

Next get your own website. If you are web savvy you might be able to design your own site for free. If not, spend up to several thousand on a great looking website. I would spend here according to how exclusive and expensive your property is. If it’s a cookie cutter condo for $100 a night don’t overspend, but do get a site up. If you have a multi million dollar property, or a portfolio of 20 properties, spend a decent amount of $ to properly showcase your property. If you are in it for the long haul, this is just a one time cost assuming it’s a site you can update yourself, which it should be.

Why do you want your own website?

  • An independent source of leads not dependent on the listing sites.
  • You control everything. Unlimited photos. No restrictions.
  • Legitimizes your rental.
  • When linking to it, it’s your site only. Better than sending someone to HomeAway where they can easily go look at 100 other options.
  • Let’s you establish a place on the Google Map, which can bring loads of free traffic.
  • Your Blog, which lets you write articles and increase traffic to your site.
  • When you sell your rental: You can sell it as a VR with a built-in business and potentially sell the property for much more.

Additional Marketing (your own website required)

Google Adwords – Pay per click for people searching for your VR area. This is nice because you control how much you spend, and can target exactly the kind of customer you want, geography, and timing of your ads.
PR – press releases on your VR. These can build lots of traffic for your site.

Grand Totals:

HomeAway: $999 Platinum Level for maximum exposure.
VRBO: $250 if you bundle with HomeAway.
Flipkey: $0 upfront, pay 3% per deal.
VacationRentals.com: $199
AirBnb: $0 upfront, pay 3% per deal.
Website: $0 – 5K (one time fee usually).
Adwords: Less than $1000 depending on your market and goals, however I spend less than $200 a year.
Press Release: $250
Email Marketing: $50
Misc: $1000
Total $5000 a year max


Fully Booked (90%) at $200 a night x 325 nights = $65,000
50% Booked at $200 a night x 185 nights = $37,000

EXTRA $28,000 in RENT


Raise prices by JUST $10 a night = $3250  ($20 = $6500)
Referral Fees from other owners = $2400*
* Check to make sure referral fees are legal in your area.

Total = $5650

This total paid for all of the marketing and gave an increase of $28,000 in rental income.

I can’t stress enough: This is a spend money to make money business! If you don’t spend any, you won’t make any!

The good news: the longer you own your rental you can actually lower your marketing spend without hurting your bookings/profits. This is because of two main reasons. 1) an increase in repeat business over time 2) if your website is successful you can get most of your leads there. But that usually takes considerable time and effort.

Please note: This is an example only and is not a guarantee of similar returns. I do however use the above methods myself.

So, what do you think? Is this the worst idea ever or do you agree in the “be everywhere” strategy?

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