building manager probe did something that Airbnb can’t do and most management companies have been loath to do – the company has eliminated cleaning fees for guests.
Until Sonder scrapped cleaning fees, about three-quarters of Sonder-managed properties, including apartments, condos and hotel rooms everywhere from New York to Dubai, viewed cleaning fees as a charge. distinct in the total price of the stay. Fee amounts varied by property type and market, the company said.
Rivals of Sonder’s property managers such as Vacasa, Evolve and Vtrips all generally charge separate cleaning fees.
But Sonder quietly rolled out what he calls “zero cleaning fees” in November, although there was no official announcement.
“We’ve rolled out zero cleaning fees across our portfolio, to further simplify pricing for our customers,” said Nathan Bacher, vice president of revenue management at Sonder. “Price transparency was already part of the Sonder experience, and it goes even further.”
Bacher added that price transparency would help Sonder in his still small but business travel growth.
Here is a Sonder listing for a studio in New York. It clearly indicates the total price after taxes and including all fees. There is no charge for cleaning.
Previously, Sonder stood out among property managers and online travel agencies by displaying the full price, including tax, when travelers selected dates and first viewed listings. As it does now with the elimination of cleaning fees, Sonder has itemized rates per night multiplied by the number of nights; discounts or other promotions; any other costs; taxes and total rate. The difference is that there is no longer a separate cleaning fee.
Here’s a Vacasa listing for a four-night stay in Intervale, New Hampshire. It shows the total price of the stay, which includes $371 in fees, including $220 in cleaning fees, after taxes. (Airbnb, for its part, details the “total price” before taxes.)
Property managers such as Sonder have the power to eliminate cleaning fees because they operate these apartments or hotel rooms on behalf of landlords. In contrast, third-party online travel agencies such as Airbnb have fewer ways to eliminate or reduce cleaning fees because their terms and conditions allow hosts to set the price of stays and cleaning fees.
Airbnb recently started indicating the price of an advertisement, including cleaning costs, in advance in many major markets, but excluding taxes. Sonder, a much smaller company than Airbnb, shows the full price including tax. Airbnb said its initial price displays exclude taxes, because that’s how outlets in the United States, for example, typically display prices.
Oh, the pain of the surprise cleaning fee
Cleaning fees have been a sore point in the short-term rental industry for years as they can sometimes be significant and exorbitant, and also a surprise when it comes time to pay, especially when some hosts charge a flat-rate cleaning fee regardless. the duration. of the reservation.
Some hosts view cleaning fees as a profit center, a way to make extra money because they may charge guests more than they actually pay to have the unit cleaned. On the other hand, prices for cleaning services have increased with inflation.
There may be a sticker shock about cleaning fees on a Booking.com listing for 341 East 62nd Street in Manhattan, which it describes as “an unbeatable room with a huge private patio.” The booking shows the price for a week in bold at $2,450, but you should notice the fine print says there is also a $98 service charge and a $150 cleaning fee. The host also charges the same $150 cleaning fee for a two-night stay.
But at least we have to give Booking.com credit for detailing the charges, albeit in a somewhat diminished way.
Does Sonder just hide the cleaning fee?
One has to wonder if Sonder’s elimination of separate cleaning fees means the company is simply hiding them in the room rate or absorbing them in some other way.
Bacher of Sonder wouldn’t be specific on this, saying, “We’ve waived the cleaning fee to provide greater transparency and a frictionless booking experience for guests, while offering competitive rates.”
Andrew McConnell, CEO of a revenue management technology company Rented, said the success of Sonder’s elimination of cleaning fees would depend on guest perception, including how Airbnb and other online travel companies display Sonder’s prices when Sonder markets its rooms through l intermediary of these third parties. (Airbnb and Booking.com show Sonder’s total rate without a cleaning fee. However, we found instances where Airbnb and Booking detailed a $1 cleaning fee on Sonder properties.)
“A guest really wants to know what they’re going to pay in total,” McConnell said. “Either Sonder really got rid of the cleaning fee, and there’s a cost advantage (or they’re incurring more loss per booking), or it’s just a bundled thing, and if third-party listing sites start listing all-inclusive costs, this is going to be a wash.
Steve Milo, founder and CEO of the property manager Vtripswho charges cleaning fees, said he didn’t believe Sonder’s approach would work.
“I don’t think the regrouping fee will be successful,” Milo said. “There is a reason the airlines have unbundled their fees. Google Travel is a powerhouse and benefits companies that offer unbundled pricing. »
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