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Monaker Group (MKGI) is Following a Sure and Steady Path to Success in the Travel Industry

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

Let us hear your thoughts: Monaker Group, Inc. Message Board

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