The success of peer-to-peer marketplaces like Airbnb has proven that the rental marketplace model is lucrative, and can be applied to pretty much any type of business.
In the coming years, we're going to see huge innovation in the field of rental platforms. There is no better time to become a rental business entrepreneur than now. Although the industry is favorable for new businesses globally, getting things right in the beginning is very important.
The whole process of building rental marketplaces can get complex and expensive as it involves high-end tech.
There are no shortcuts for launching a rental marketplace and running it successfully.
In this blog, let’s look into some best practices to overcome running a rental marketplace. Having a good strategy and knowing the best practices will help, but you still have to put in a lot of hard work to grow your business. Let’s get started.
1. Build a community
When you are building a rental marketplace, try establishing a community that helps in creating trust between users. If you consider Airbnb’s marketing strategy, it is more than a peer-peer accommodation provider. Airbnb has been successful in creating their own community where they encourage detailed profiles, regular communication between users, and a strong review system. The engagement in the Airbnb platform is phenomenal.
It is not just better communication or strong reviews; it is also the authenticity of the experience that makes Airbnb a successful community. Gain inspiration from marketing strategy by offering top quality services and connecting people together to expand beyond a peer-peer rental market place.
2. Deliver a remarkable user experience
The user experience is all about what your customers feel when they visit your platform or application or use your services. To deliver a great user experience to your customers, you must maintain the right balance between your actions and your customer’s expectations. When designing a remarkable customer experience, start from the first screen a user sees in your platform to reliable customer service. To make a great online rental business, your platform must also have a unique, attractive, and gripping content structure.
3. Choosing the right technology
We live in an era of hyper-connectivity where technology plays a major role in powering every online business. To repeat the success of an already existing marketplace, you can use the same technology used by the pioneers to provide the same level of reliability and safety to your customers. For example, if your business model is similar to that of Airbnb but in a different niche, you can use an Airbnb clone to build your marketplace with the same technologies to implement the same functionalities and features customized according to your needs.
4. Security
Security is one of the significant attributes that help rental marketplaces progress to the next level. Your online rental platforms must have strong and robust security architecture to protect sensitive user data and financial transactions. For example, the SSL protection is necessary for any online platform to ensure the Internet transactions remain safe and secure.
It is not just about the security of your online platform, the security of the user’s properties is equally important. Ensure that all the booking requests and interactions of your users are screened, reviewed, and free of fraudulent activities. If there is the slightest sign of any unusual activity in any account, you must have a system that activates to solve the issue.
For instance, Airbnb has “Airlock” to deal with fraudulent activities. In case of any unusual activity on the platform, the interaction will be blocked triggering their multi-factor authentication security system. Run extensive background checks and offer escrow services and in addition, to ensure that the service providers in your platform get compensated for the products or services they offer without fail.
5. Build relationships with relevant influencers
Influencer marketing is one of the best ways to leverage word of mouth publicity. Any event your business hosts, make sure you invite as many social influences as possible, you will be surprised by the results.
If you are running an apartment rental marketplace, you can utilize the impact of celebrity stays by partnering with celebrities and offering your services in return for some social media love, page hits, and new users. By collaborating with relevant influencers, you are connecting with their audience as well. It also helps in converting your one-time customers into forever-loyal customers. Influencer marketing instantly increases brand awareness and drives quicker customer retention.
6. Business model
The choice of business model is one of the main factors that the success of every rental marketplace. Rental businesses are long term initiatives that require the best revenue strategies to finance their operations. One of the primary reasons why a new business fails is that they choose a revenue model that doesn’t scale. The key elements of a rental marketplace business model include the target market, competitive advantage, unique value proposition, key metrics, price structure, revenue channels, and profit margins. The common business models of the rental marketplace are commission model, membership model, a freemium model with featured listings and ads, etc.
7. Great customer service
Offering great customer service to your customers will dramatically increase the growth and value of your rental marketplace. Best customer service increases customer retention by 10% and automatically increases the profit by up to 30%. Investing in customer service will also decrease the churn rate and money you have to spend on acquiring new customers. In the event that something bad happens, 24/7 customer service is critical to increasing customer satisfaction.
In Conclusion
There has not been a better time to enter into the online rental business arena as the market is maturing with people preferring rentals over ownerships. Thanks to the Internet and technology, launching a rental marketplace has become easy and emerged as one of the most lucrative business ideas. Whether you are a budding entrepreneur or an already existing rental business struggling to outperform competitors, these best practices will help to take your business to new heights. Focus on offering a remarkable experience for your customers rather than providing just the rental services. It is when you will create a customer for life for your business.