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Channel Manager vs PMS [+ How They Can Transform Your Business]

By June 1, 2022 September 27th, 2022 No Comments
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Whether you’re an Airbnb owner or a vacation rental property manager, there comes a time when trying to scale your business without a system in place becomes overwhelming. Fortunately, problems like avoiding double bookings and updating listings on OTAs (online travel agencies) have been solved by property management systems and channel manager software.

Unfortunately, to a newcomer in the industry, it’s not always clear what the difference between them is. If you aren’t quite sure what a channel manager vs a PMS is, we’ve broken it down for you here.

Channel manager vs Property Management System

TL;DR – A channel manager lets you list properties on multiple listing sites at once. The software coordinates your calendar and prevents double bookings. A property management system centralizes all your operations in one hub, lets you automate repetitive tasks, and coordinatoes operations with other specialized vacation rental software.

Another TL;DR – PMSs offer connectivity to all the major listing sites. Channel managers really shine when you want to list on niche websites (i.e.; you offer an eco-home and want to advertise to eco-conscious travellers). For the majority of hosts and property managers, choosing a PMS vs a channel manager is the best choice. You’ll get to list on the sites that drive bookings, but benefit from the automation tools that the Channel Manager don’t offer.

The truth is, channel managers advertise having similar features to PMSs. And PMSs do the same vs channel managers. At the end of the day, the channel manager is to widen your marketing distribution and reach. The PMS is to centralize, coordinate, and automate your operations with basic marketing distribution capabilities.

In the rest of the article, we take a deep dive into some of the extra features of both

What is a PMS?

The acronym PMS stands for a Property Management System. It’s an end-to-end solution for short-term managers and Airbnb hosts to simplify and automate their day-to-day operations.

You’ll see PMS sometimes called PMP (short for Property Management Platform). The use of PMP is simply to highlight that the software used is the base of all other integrated apps and is a central hub for a team to work off.

How does a property management system work?

PMSs have been around since the early days of hotel management. Large and small hoteliers use this type of software to ensure that they don’t double book, track their online payments, coordinate cleaning and turnover tasks, and automate messaging. Using this type of software has been essential to their business, significantly eliminating time-consuming front-desk tasks like re-typing out the same email in response to repetitive questions from guests.

Now, this technology has been adapted to fit the specific needs of hosts and property managers in the vacation rental industry. For example, PMSs typically have direct connectivity with booking engines like Airbnb, Vrbo, Booking.com, Expedia, and others. Additionally, they integrate with third-party vendor apps such as cleaning, dynamic software, and others that are custom for short-term rental operators.

What are the benefits of using property management software?

This type of software makes it easier and less time-consuming to manage bookings, improve communication during your guests’ stay, and streamline check-in and check-out procedures. Here’s a video prepared by Hostfully that explains the key benefits:

Here are more details on some of the benefits you can expect from implementing a PMS:

#1 Automated messaging

Have you lost the enthusiasm you once had when you got a booking inquiry or a question from a potential guest? When you’re busy, it’s easy to start resenting all the work it takes to provide top-notch guest communication and help walk potential guests through your check-in process. It’s also a terrible feeling to know you’ve taken too long to get back to a client or missed their message altogether because you’re so swamped with administrative work and lost an opportunity for a booking.

With automated messaging, you’ll never have to worry about missing an inquiry again with customizable template messages that will respond to direct inquiries, send booking reminders, directions, check-in and check-out instructions, and requests for payment.

#2 The use of a central calendar 

Property management software syncs all your reservations for all your properties across all the listing sites on one calendar. That’s a long sentence, but there’s no short way to explain it.

What this solves is the time-consuming of flipping between multiple calendars on a bunch of sites. When you implement management software, you’ll be able to see all of that and more with just a glance. And you can finally ditch all the time referencing logging into multiple platforms to get the answers you need.

#3 Take payments easily with payment processing

You can do everything right, but if the payment process is bumpy it can make a significant dent in your bottom line. To avoid overlooking missed payments or applying them to the wrong account, a property management system will simplify the process with features like collecting direct booking payments, paying out vacation rental homeowners (if you’re a property manager), charging for additional services, holding security deposits and integrating with popular payment processors with trusted payment gateways like Stripe.

#4 Reports and analytics

Knowing your numbers and seeing which properties are performing well and which ones need some attention will assist you in making solid financial decisions on how to prioritize your time and attention to increase revenue and patch up any leaky holes. The reports and analytics features will allow you to drill down on key metrics like occupancy rates per property, sales by agent and much more. Armed with this information, you can stop flying blind and avoid unwanted financial surprises.

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Most property management platforms come with basic reports and analytics features. Even the most basic management systems integrate with (that means it exchanges information) software like Key Data Dashboard. This type of 3rd party software specializes in extracting actionable insights from your booking data. The best PMSs let you create any sort of custom reports. So if you’re familiar with Excel or Google Sheets and want to learn how to crunch vacation rental metrics yourself, you can also do it yourself.

#5 Boost direct bookings

A good PMS will offer you two options for securing direct bookings. If you’re curious to learn more about the importance of direct booking sites, check out this article on becoming independent from listing sites for bookings.

One is a pre-built direct booking site where a visitor can make reservations. You can’t really edit the look and feel of the site. But if you have a way to reach potential repeat guests, it’s a cheap and effective way to rebook with you without having to pay fees.

The second option is a calendar widget that a web developer can insert in any custom site. It offers similar functionality as what guests are used to seeing on major hotel sites (pick a date range and price, then book).

Related post: How to Choose a PMS for Your Vacation Rental Business [2022]

link to download paper on direct booking sites

What is a channel manager?

A channel manager is a bonus tool that will help you to diversify your distribution strategy across multiple distribution channels like Airbnb, Vrbo, and Booking.com. This specialized software makes it possible to distribute and update multiple listings in real-time from one central spot.

How does a channel manager work?

Channel managers are designed to communicate with the dozens of listing sites that advertise vacation rentals. Channel managers offer way more options for listing than PMSs. It’s their specialty.

Think of it this way. PMSs spend their time developing automation tools and connectivity with niche vacation rental software. When they have spare time, or a request by their users to do so, they build connectivity to a listing site. Channel managers are the opposite. They spend most of their dollars creating integrations to as many listing sites as possible.

Note that all Channel Managers integrate into PMSs. Most property managers start by building their businesses with a PMSs. After they mastered pricing, have all their cleaning teams synced and working off the PMS, and built a reliable flow of direct bookings, they tack on a Channel Manager to really expand their distribution offering.

What are the benefits of using a channel manager?

A channel manager means you can list your properties across multiple distribution channels and have them updated automatically. You’ll also benefit from having a birdseye view of your availability with a single calendar that syncs with various booking channels.

How to book listings in the offseason

Additional benefits of using a channel manager are:

#1 Avoid double bookings

If you’ve ever accidentally accepted a double-booking, you know the sinking feeling you get when you realize you’ll have to contact a booked guest and cancel their plans. Airbnb greatly discourages hosts from canceling bookings and enforces a strict cancellation and penalty policy. When you use a channel manager, you’ll benefit from a centralized calendar that will automatically update your calendar and listings across all your booking channels, alleviating the stress of overbooking and saving you from upset guests, negative reviews, and penalties.

Note that a PMS also has the benefit of preventing double bookings. PMSs similarly sync properties across multiple platforms and block off calendars.

#2 Save time uploading and updating multiple listings

With a channel manager, you’ll be able to manage all your listings in one place where you can upload and adjust them easily in real-time. This function will save you an untold amount of time and increase your ability to advertise your properties across more distribution channels resulting in higher visibility and more bookings.

Next steps: choosing the right property management software for you

Selecting the right PMS for you is an important decision. Not all property management systems are created equal, nor are their price tags. You’ll want to make sure that you choose one that offers you the functionalities you need presently and that it can grow alongside you as your business expands.

Here are some tips we suggest to help you make the best choice for your business:

  • Create a list of the must-have functionalities and features that you need and want. Features like a unified inbox, being able to schedule turnover cleanings and maintenance appointments, integrating with a trusted payment gateway, integrating with a direct booking site, and offering reports and analytics that will help you track key metrics as you grow.
  • Ensure that the PMS you choose will work seamlessly with a channel manager or has a built-in channel manager so you can easily manage and update multiple channel distributions and have your PMS update in real-time.
  • Narrow down your choices and book a demo with your preferred providers so that you can make an informed decision and ask as many questions as necessary.
  • Make sure that there is a mobile app so that you will have the convenience of conducting your business from anywhere at any time.
  • Ensure that the provider has a powerful list of partners and integrations to help you build a PMS that serves your individual business needs.
  • Make sure there is a suite of products like direct booking sites and digital guidebooks to help you build out your business further and offer your guests a more complete experience with your brand.
  • Check to ensure they offer strong customer support that is accessible and committed to providing you get the most out of their product.

call to action to book a demo for Hostfully PMP

Next steps: Picking the best channel manager for you

When choosing a channel manager, what you get in terms of functionality will largely depend on the provider, requiring some research on your behalf. We’ve put together a list of the features and functions we think are incredibly important so that you can benefit from gaining back the precious time you would have spent updating online booking channels and trying to keep your calendars in sync.

Here are some tips we suggest to help you choose the best channel manager for your business:

  • Select a few different companies and compare which channel distributions they support. Make sure that it works with a diverse group of booking channels, including niche OTA’s, the most frequented online travel agencies, and metasearch engines.
  • Ensure that the channel manager will seamlessly integrate with your direct booking site and your property management system.
  • Consider functionalities you might not think about until your company has experienced some growth, like multiple currency support and having multiple users so as your team expands, you can provide them with access to the system.
  • Make sure that it uses two-way synchronization, which is a critical feature using a complex API that will synchronize and update all your sales channels to reflect bookings and any rate changes in real-time.
  • Once again, you’ll want to be confident that the provider has a fantastic customer support team to help you with onboarding, implementation, and ongoing support.

Integrate your channel manager with your PMS

A property management system and a channel manager serve different purposes, but when used together, they create a robust system saving you time, money, and the platform for increased occupancies and revenue.

Once you’ve decided to adopt these systems, it’s recommended to choose a property management system with its own built-in channel manager so that you don’t have to work with two different systems and have the same customer support team for onboarding, implementation, and development. This choice will also ensure that both systems are designed to work well together.

It’s time to level up!

An integrated property management system and channel manager will simplify your life and transform your business. Once you’ve implemented these two systems, you’ll be able to throw your spreadsheets away, stop managing multiple calendars and increase your visibility in various distribution channels with ease. It’s time to level up!