One of Aesop’s Fables concerns The Tortoise and the Hare and
provides lessons for us even today, some 2,500 years after it was written. One
of those precepts is that the swiftest do not always win the race. The hare in
that allegory, undoubtedly, had all the alacrity that members of its genus are
capable of; yet it lost to the sure and steady tortoise. Like Aesop’s fabled
world, the corporate world has its hares and tortoises, too. Not always do
those first out of the gate touch the tape of success.
The rapidly expanding racecourse of alternative lodging has
its hares that appear to have the race wrapped up with their large number of
listings. However, Monaker Group, Inc. (OTCQB: MKGI) is on a surer and steadier
course, because it is focusing on return rather than just reducing channel
costs. Its extensive video portfolio can enhance the research process for
would-be vacationers by starting the holiday virtually… before it actually
begins.
CEO Bill Kerby has described the alternative lodging market
as ‘the hottest space in travel’; here’s why. Alternative lodging rentals
(ALRs) are whole-unit vacation homes or timeshare resort units that are fully
furnished, privately owned residential properties, including houses,
condominiums, villas and cabins, that property owners and managers rent to the
public on a nightly, weekly or monthly basis. Recent estimates by Research and
Markets indicate that this market will grow by a whopping 70 percent over a
four-year period from $100 billion in 2015 to $169.7 billion in 2019.
However, this alternative lodging sub-segment is just part
of the larger online travel agency (OTA) segment of the giant global travel
market. Online travel agency or travel booking revenues, as they are also
referred to, are currently about $340 billion with a projected growth rate of
12 percent, while global international tourism revenue in 2014 was $1.25
trillion, according to Statista. Online travel agencies (OTAs) expand their
reach much wider than their traditional counterparts do. They offer information
and access to airlines, hotel and alternative lodging, car rentals, cruise,
rail and a combination of any of the above, referred to in the industry as
packaged travel.
The prospects of the industry are indeed promising and, at
present, it appears that that promise has already been harvested by the
privately-held Airbnb and HomeAway, now a subsidiary of Expedia, Inc. (NASDAQ:
EXPE), with their myriad listings. But there’s more to this than meets the eye.
A comprehensive report from investment bank Evercore ISI points out:
“While we are seeing larger online demand channels expand
their inventory of vacation rentals listings, this still has not translated to
bookings fully shifting to online. In fact, these listings are largely utilized
to drive leads for renters, while actual bookings continue to occur via cash,
check, PayPal, etc. whereby the original demand channel is not involved. For
instance, while 2012 data indicates that vacation rental listing sites are
responsible for nearly 60% of reservations, only 8% of reservations come from
booking sites, demonstrating that we still see a fair amount of leakage whereby
transactions occur through different means or even offline, potentially
skirting a booking commission. Closing this gap between leads and transactions
could prove to be another potential tailwind for the industry.”
Listings are great, but they aren’t everything.
Monaker Group is differentiating itself by enhancing its
listings with a rich array of video-centered marketing and itinerary technology
for travel customers. The website VIRTUETS Video Marketing for Real Estate
provides data that shows why this is crucial to success. Video can increase
click-through rates by more than 90 percent, and 90 percent of users say that
seeing a video about a product is helpful in the decision process. Forbes
writes that 59 percent of executives would rather watch video than read text,
and, according to an Australian Real Estate Group, real estate listings that
include a video receive 403 percent more inquiries than those without.
Monaker is forging ahead with listings, too. Since the
launch of its flagship NextTrip platform in February 2016, it has listed some
250,000 units of vacation rental inventory. It has about one million additional
alternative lodging units under contract that will soon be added to the
platform. This will position the company to challenge industry leaders Airbnb
and HomeAway.
For more information, visit www.monakergroup.com
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