Will Booking.com Alter Its Vacation Rental Business Model in 2016?
Photo Credit: Booking.com is increasingly following a solitary path in declining to charge travelers a booking fee for vacation rentals. Pictured is a screenshot from the company's 'Booking Hero' TV ad. Booking.com
Skift Take
It is very attractive for Booking.com to abstain from charging travelers a booking fee on vacation rentals. But the lack thereof means Booking.com's commissions may not be competitive and shareholders will likely demand that Booking.com maximize the revenue opportunity and impose the booking fee.
Rest assured that when Priceline Group officials review the company's 2015 earnings with financial analysts next year, someone will ask how long its Booking.com unit can hold off and ignore the financial opportunity in charging travelers a booking fee for vacation rental bookings.
HomeAway, for example, plans to introduce a booking fee for travelers in the second quarter of 2016 and officials forecast it could eventually triple the company's annual revenue.
As 2015 becomes history, Booking.com finds its vacation rental business model increasingly isolated -- Booking.com officials would call it differentiated -- in that the other major vacation rental players, including Airbnb, Expedia/HomeAway and TripAdvisor/Flipkey, will all be levying or increasing booking fees for travelers in 2016 and charging owners lower commissions than Booking.com does.
In explaining why Priceline didn't pull the trigger
