Like Orbitz Worldwide previously and Expedia Inc. currently, HomeAway is transitioning its global sites to a common technology platform, a move that will facilitate HomeAway’s efforts to phase in a tiered-pricing model globally.
HomeAway.com is already on the tech platform and HomeAway’s¬†VRBO¬†brand has implemented the first phase of its migration, which is slated to be completed in 2012, CEO Brian Sharples told analysts February 22.
Speaking during HomeAway’s fourth quarter earnings call, Sharples noted that HomeAway.com and VRBO account for about half of HomeAway’s listings.
Three of the company’s sites in Europe, which saw slower than expected sales in the fourth quarter and accounted for 38% of revenue in 2011, will be brought on board in the fourth quarter of 2012, officials said, cumulatively bringing about 70% to 75% of HomeAway’s listings onto the new platform along with tiered pricing.
Platform migrations are a major distraction and expense for any company. After several years, Orbitz Worldwide completed its sites’ migration to a new tech platform February 1, and Expedia, which put Hotels.com on its new platform early in 2010, will be putting the finishing touches on getting Expedia’s vacation packages onto the platform toward the end of 2012, the company projects.
Sharples indicated that HomeAway’s US businesses out-performed expectations in the fourth quarter while its European sites, facing an industrywide slowdown in vacation rental keyword terms and pressure on traffic and sales growth, were under-performing.
The migration to a common platform would enable HomeAway to globally phase in tiered pricing, which was implemented on HomeAway.com in 2011, Sharples said.
In the US, the tiered pricing for vacation rental properties at the Classic level costs $329 annually and includes a basic ranking in search results, along with two dozen photos, reviews, a map, and an availability calendar.
There are five levels of subscription pricing, with the highest tier, the Premium level, costing $999 per year. Among the Premium features, properties get rotated into an exclusive Featured Rental display, the company says.
Among HomeAway’s key metrics, visits to its global sites increased 21.8% to 97.1 million during the fourth quarter, compared with the same period in 2010.
HomeAway narrowed its net losses in the seasonally slow fourth quarter to $256,000, compared with a net loss of $10.6 million a year earlier. Revenue increased 28.5% to $58.5 million in the fourth quarter, driven by record renewal rates at 76.8%, a jump in new listings and the addition of ancillary services.
In other news, Sharples said a Carefree Rental Guarantee, protecting renters’ payments in the event of fraud or misrepresentation, will go live March 13.
The only global competitors that HomeAway pays attention to are Airbnb and TripAdvisor, with the latter being the “most annoying” in the UK because of its deep discounting practices, Sharples said.