If you are managing multiple short-term rentals, you know that problem guests and fraud chargebacks can be a nightmare for a hospitality business. Letting bad guests in your property can cause property damage, negative review increase, damaged local reputation and even lost rental income. This us why it is important to build a robust guest screening and verification strategy to bulletproof your scaling vacation rental business.
We have teamed up with Autohost to gain a better understanding of guest screening process and solutions that allow to streamline this process for both operators and guests. Our matter experts share top tips and best practices to implement in guest vetting process to achieve peace of mind. They will share a plan of what to do to prevent scams and how to face events of fraud and chargebacks when they already happened.
Moderator: Francois Gouelo, Cofounder and CEO of Enso Connect
Guest speaker: Austen Bernhardt, Sales and Partnership Manager, Autohost
Watch the full webinar recording
The importance of guest screening and verification for vacation rentals
Why do property managers need a proper guest screening and verification to ensure safety, security, and overall quality of vacation rentals? The top 5 reasons for that are:
Safety and security
By implementing a thorough guest screening process, you can reduce the risks of potential harm, such as property damage, theft, or illegal activities. Screening guests helps you identify any potential red flags, such as criminal records or negative reviews from previous hosts. This lets you filter out risky reservations and make informed decisions about who you allow to stay in your rental.
Trust between property managers and guests
When hosting people in a rental property, there are many unknowns.
When relying on different online travel agencies (OTAs) to attract guests, you have to “blindly” trust these platforms adequately screen and verify the guests. However, this trust often lacks transparency and control for property managers. For example, while Airbnb incorporates certain screening measures, Booking.com lacks such protocols. With direct bookings, hospitality businesses can only rely on their own verification resources. Implementing thorough vetting processes internally brings operators the much-needed visibility and control over guest selection.
When the verification process is conducted in a professional and convenient way, it helps building trust with guests. They develop confidence in the operators and feel more comfortable sharing personal details, including documents for identity check. By streamlining and simplifying the process, operators increase the overall guest experience and satisfaction.
Trustworthy relationships with property owners
In a highly competitive market, it’s important to ensure that property owners recognize you as the top choice for managing their properties. The ability to instill confidence in property owners by preventing fraud becomes a significant differentiator for property management companies.
Risks of not using proper guest verification tools in vacation rentals
The absence or inadequate implementation of guest screening and verification in vacation rentals can expose operators to many risks. The most common and painful of the are identity theft and chargebacks. On the side of the property management team, there is also a risk of human error or discrimination, which can be harmful for the business.
A comprehensive risk profile for each guest, including valid identification and credit card information, is crucial for ensuring property security.
Technology-driven guest-screening solutions help prevent chargebacks by analyzing data, detecting inconsistencies, and mitigating potential discrimination risks.
Protecting your business against frauds and chargebacks
When mitigating fraud chargebacks, the absence of guest data often leads to a situation of conflicting claims without concrete evidence. Credit card companies and OTAs often side with the guest as the primary customer, leaving property managers at a disadvantage.
However, by presenting objective evidence property managers can establish a strong case. These can be guest’s digital fingerprint, signed rental agreements, matching credit card and ID information, etc.
This is precisely what Autohost and Enso Connect integration accomplishes by collecting, analyzing, and generating risk profiles. The primary focus is on preventing chargebacks with a high degree of accuracy, thereby avoiding financial losses and the need for post-stay disputes.
By de-risking the situation, property managers can ensure a steady flow of revenue without engaging in exhaustive battles to recover lost funds. In the event that a chargeback has occurred, Enso-connected users can retrieve a Chargeback Report. This report serves as a comprehensive summary of all the evidence pertaining to the transaction in question.
Do you always need a rental agreement in vacation rentals?
The quick answer is yes. Even if your bookings come from Airbnb, which has it’s own documentation, you should have your guests sign an agreement. Because there’s always going to be certain aspects that the OTAs won’t even let you write on your contracts. This is your reservation, the guests stay at your properties, so you should have the full control.
In cases of disputes with Airbnb, having your own rental agreement that clearly states the guest’s commitment to refrain from damaging the property or engaging in prohibited activities becomes crucial. By presenting this evidence to Airbnb as the merchant of record, you can request the necessary financial compensation. This approach effectively strengthens your position, providing you with additional leverage and support in resolving the dispute.
2. ID verification
ID verification goes beyond merely collecting and storing identification documents. It involves verifying the authenticity of the ID by checking for any signs of tampering or manipulation, such as photoshopping. It includes ensuring that the information on the front matches the encoded data on the barcode at the back. With thorough scanning and validation, both the property management team and the guests can benefit from enhanced security and confidence.
3. Credit card validation
Implementing either a security deposit or a credit card verification process allows for the collection of three crucial data points.
What is guest digital fingerprint?
We gather the three essential data points and incorporate the guest’s device and browser information into the verification process. This allows us to acquire a wealth of data to construct guest digital fingerprint. These data points form the core elements necessary to build a comprehensive risk profile. The back-end operations extensively use this information, enabling thorough analysis and risk management.
Balancing the security with the guest experience at scale
What if a guest that doesn’t want to go through your verification process? This can impact the guest experience and your relationships with guests. Is it worth to take the risk and give up on verification process to win the reservation? What are some of the exceptions where you have to mitigate the risk for your business?
The approach to guest vetting’s impact on the guest experience can vary depending on the property management company’s preference. Some companies with a large number of properties may have strict procedures in place. They require guests to provide the necessary information, agreeing to the process. Failure to comply may result in termination of the stay. Other companies aim to streamline the workflow by reducing up to 90% of the manual guest checking process. However, there is still value in assessing bookings where a guest may be hesitant to provide certain information. In such cases, operators have the flexibility to reach out to guests, communicate with them directly, and evaluate the risks involved. They can choose to accept the risk and proceed with the booking. They can use resources available on the Autohost website to manually vet guests via phone or email.
Benefits of Enso Connect and Autohost integration for seamless guest verification
The Autohost and Enso partnership allows to automate guest verification, eliminating the need to manually verify each guest. The system identifies and flags potentially risky guests, allowing property managers to focus their attention on those cases. The payment aspect is also noteworthy, with different connection options available. Some users can process payments through Autohost, while others can handle them through their own system. Additional security measures like 3D Secure can be implemented alongside other data to enhance the overall risk profile. The partnership between Enso Connect and Autohost enables continuous improvements to the flow and process. It allows property managers to customize the guest experience based on risk profiles generated by AI tools. For instance, different flows can be applied based on factors such as booking lead time or guest credit checks. This flexibility aims to minimize guest friction while prioritizing the prevention of fraudulent bookings.
Our integration eliminates redundancies. For example, guests no longer need to manually enter their personal information such as first and last name, etc. Instead, this information is automatically populated, streamlining the flow and saving guests time and effort.
Driving revenue, bookings and owners with guest verification
When property managers talk about their priorities—revenue, bookings, and owners—they often overlook the importance of verification. However, implementing a robust guest screening process can positively impact all three aspects. By incorporating Autohost into their workflow, property managers can open up new revenue channels, eliminate missed opportunities, and gain the confidence to take risks without compromising security. Autohost’s low false positive rate ensures accurate screening, allowing property managers to tap into quality revenue sources. Additionally, the use of Autohost can be a strong selling point for property managers when pitching to new owners, as it demonstrates a commitment to security and risk prevention. The partnership between Enso Connect and Autohost offers a seamless integration, delivering time-saving solutions and building trust among property owners.
Communicating the screening process with guests
Effective communication with guests regarding verification is crucial and varies across different channels. For example, Airbnb guests may be hesitant to share information outside the platform. It is crucial to communicate in advance, explaining the purpose and security measures before the guests book. Collecting IDs via a secure portal is recommended. Clear messaging in initial emails or texts is essential, emphasizing the mandatory verification step – add it to your OTA listings. Mandatory guest screening is preferable over optional to ensure compliance. Consider country-specific requirements.
Data privacy: protecting vacation rental guest data
AutoHost specializes in the field of cybersecurity, ensuring that the process of collecting IDs is highly secure. With a strong background in privacy and technology, Autohost brings a cybersecurity standard to the hospitality industry. Unlike other software solutions, AutoHost prioritizes the protection of user data and securely collects the necessary information.
How to handle disputes and vacation rental chargebacks
What to do in a scenario where a chargeback has occurred despite following the internal process and collecting relevant information? In such cases, both Enso Connect and Autohost offer a chargeback report to assist in disputing these chargebacks. The basic process includes three to four steps. We document the agreement, gather IDs and check-in instructions, and with key data obtained through the Boarding Pass. This data includes information like IP address, latitude and longitude, location, the type of phone used and smart locks info. This comprehensive report is readily accessible with a single click on the Enso Connect platform.
Implementing guest screening and verification process in a hospitality business
Autohost and Enso Connect offer various options for ID collection, including front and back scans as well as a selfie. The selfie scan ensures a biometric match between the ID photo and the guest’s selfie. A common question that arises is whether guests can upload a picture instead of taking a live one. In such cases, Autohost’s advanced verification process considers additional factors, such as the context and consistency of the profile information, to identify potential fraudulent attempts. By analyzing collected data and patterns, Autohost continuously improves its AI-powered system to enhance guest screening and prevent fraudulent bookings. Additionally, property managers who use Autohost can benefit from sharing best practices and insights within the network, leading to more effective and informed decision-making.
Calculating the ROI of guest verification tools
When it comes to implementing guest screening and considering budget, finding a cost-effective solution is important. Autohost allows a choice between a per-reservation cost or a flat unit rate that covers all reservations. The Autohost and Enso Connect integration allows tailoring the service to specific needs and priorities of each operator. This way, Enso-connected users can set conditions to use Autohost service only for bookings with a higher risk and manually check the Airbnb ones.
When evaluating the return on investment (ROI), take into account the value brought by a guest verification tool. While the cost per reservation may seem arbitrary, it’s crucial to consider the savings and time it can generate in the long run. By preventing chargebacks and avoiding risky bookings, you can save significant amounts of money and resources. For example, a single chargeback can cost hundreds of dollars, which could have been prevented with proper guest screening.
You can confidently explore different booking channels, including direct bookings, without fear of fraud. Remove trust issues by verifying guests regardless of the booking channel or lead booking time. This empowers you to build and expand your direct booking channel, reducing fees paid to online travel agencies (OTAs) and consolidating your revenue streams.
Transitioning towards verification: tips for taking initial steps
For those who are not yet ready to fully implement an automated solution for guest verification, there are some steps you can take to change your perspective and enhance your screening process. While the majority of guests are genuine and well-intentioned, there is a small percentage that may pose risks or cause problems.
One effective approach is to look for consistency throughout a guest’s profile and the information they provide. A genuine guest will typically exhibit coherence in their online presence, including their profile details and the story they share with you. On the other hand, fraudsters often try to obfuscate or confuse property owners and managers with misleading information.
A real-life example from Red Cottages highlights the significance of this approach. They had a guest who appeared legitimate on Airbnb but, upon arrival, their Airbnb profile suddenly changed to a random Russian name. Fortunately, no damage occurred, but such drastic alterations in data points can indicate serious criminal activities, including sex trafficking or other illicit operations.
It’s crucial to recognize that implementing guest verification is not just about protecting your property; it’s also about safeguarding your community’s reputation. Vacation rentals can be vulnerable to various criminal activities due to the lack of stringent processes and accountability. Borrowing lessons from the hotel industry, where identification and payment verification are common practices, we can adapt and tailor these measures to the unique needs of vacation rental management companies.
Autohost offers the flexibility needed to accommodate different management approaches, ensuring compliance while protecting the industry’s growth and reputation. As stakeholders in this rapidly evolving and expanding sector, we all bear the responsibility of safeguarding the industry and addressing the concerns that lead to imposing regulations. By instilling confidence and preventing illicit activities, we can foster a thriving vacation rental community.