Interview with Frans Schoon, owner Etoiles du Sud
The rental market is constantly changing and landlords must move with it. Not only has the consumer changed, but technology, the method of booking, has turned the market upside down in the past ten, twenty years. Frans Schoon has worked in this market all his life and has just started a new chapter with his rental company Etoiles du Sud.
By way of introduction, who is Frans Schoon?
54 years old and seasoned in travel. More than 25 years ago I started at Holland International in tour operation where, among other things, I was responsible for programming the South of France. That is also when my love for the Côte d’Azur was born. Then I made the switch to the vacation home industry and was active for almost 20 years as director of Novasol Benelux.
What have you been up to in those 20 years?
At Novasol, I worked mainly to put the brand on the map and build a large portfolio of vacation homes. For the last 10 years, I had the responsibility for the Southern European markets as a secondary task where I was able to make excellent use of my wide network in France and the special bond I have always had with the country.
Many readers obviously know some of the major rental organizations. How does that work behind the scenes there?
The larger organizations are usually owned by large parties such as equity funds where the focus is on profit optimization with the intention of eventually being able to resell the company at a large profit. So it is mainly about volume and as many vacation homes as possible, centralization of services, reduction of costs and the highest possible margin.
Doesn’t sound very strange in itself. Is there a downside?
Such a strategy unfortunately comes at the expense of product knowledge, local service and personal attention to guests and landlords; they are only a small link in the bigger picture in this playing field. Because everything is so tightly monitored, terms are inflexible, contracts often have to be exclusive, and an owner has virtually no say.
Of course, such companies have deep pockets and through their marketing power a large reach that does allow them to generate the necessary bookings. Often they all work with the same rental portals so that you will see exactly the same offer on different rental sites. As a result, it also remains to be seen who will be staying as a guest in the vacation home because these organizations usually hardly build personal ties with their tenants themselves. If an owner wants to maintain some control and profitability is not the main reason for renting out, then it is worth considering a smaller rental specialist.
Please elaborate
They are flexible, have good knowledge of product and region and know what is involved in renting a vacation home. Usually they have connections with like-minded parties in international markets and usually have a very loyal customer database. Well considered a personal advisor when renting out the vacation home with conditions tailored to the specific rental situation.
How have market conditions changed for such rental companies in the last 10, 20 years?
The rise of large portals and new parties such as AirBnB and Booking.com has changed the traditional rental market quite a bit. On the one hand, while this has brought more attention and also growth to the sector, on the other hand, brand loyalty has seriously diminished and, as a result, guest contact has become more volatile. Precisely because of the scope and popularity of the major portals, traditional rental companies are increasingly forced to adjust their business model accordingly, and consolidation and flattening is occurring.
The effect of the internet?
Vacation homes have always been an easily bookable product on the Internet, much earlier than e.g. package holidays. The use of algorithms and the ranking on Google are now the order of the day. Being well findable is essential in order not to get lost among the abundance of offers. Being distinctive and offering service is therefore becoming increasingly important.
How has the consumer changed?
The trend toward luxury and more privacy had already started, after corona we only see it increasing. Corona limited us in our freedom and quality of life, now that we are allowed again you see that the emphasis is more strongly placed on this and then a vacation home is actually the ideal accommodation. We also see more couples and families traveling together and booking the larger houses. This often also has a financial advantage compared to package tours and hotel accommodation. Divide the rental price by the number of people and then luxury and privacy turns out to be quite affordable.
Brand loyalty has decreased among today’s consumers; price has become an important factor in the booking process. Especially since many vacation rentals are offered on multiple portals, a comparison is easy to make. Consumers are also becoming increasingly empowered and have specific needs. Smaller organizations can often respond better to these than larger rental companies due to their flexibility and personal contact.
How do we engage tenants again? Or is that a rearguard action?
Engaging consumers at vacation rentals is now really based on details and exceeding expectations. This, in my opinion, is the key to turning these consumers into ambassadors of your vacation home so they also know how to enthuse potential guests within their network. Showing honest reviews of other hosts is also an excellent tool to highlight individual service.
And how do larger rental companies do that?
They have a large file to fill and a large overhead to pay for and therefore logically have less attention to individual service. Consequently, the loyalty they try to develop is more in the area of discount promotions and cross-selling on other products they offer.
How do you see the market developing over time?
The demand for personal advice will only start to increase and algorithms will take over even more. The larger parties are moving further in an even more impersonal direction so that experience and service will become more and more distinctive.
What about yourself? How will you distinguish yourself with your new venture?
Etoiles du Sud precisely wants to be a counterpart to the big organizations and portals by investing in the personal relationship with a landlord and advising him in the best possible rental. The landlord is our long-term relationship and we will always cherish it.
Of course, as a smaller player we can never compete with the marketing power of the large organizations and that is not our approach: our motto is quality over quantity. We are therefore selective in our choice of offerings and invest primarily in collaborations with local partners to help guests return home with the best vacation memories.
Etoiles du Sud has no ambition to become the biggest. We want to become the best rated. Within the current playing field, there is definitely a need for a fresh, young and professional company with the philosophy we adhere to.
Finally, do you have a golden tip for a landlord reading your story soon?
Invest in good facilities, comfort and individual service. If hospitality is the driving force, try to stand out from the crowd. Create ambassadors and partner with specialists who can advise and adjust. Quality is not so much in luxury as in the consumer’s vacation experience.