Is Airbnb Replacing The Hotel Industry

Ayvio Marketing

14 February 2020

No Comments

Whats to come

 

Last year, The Guardian ran a story about “how Airbnb took over the world.” This piece explored how Airbnb grew from a humble startup into a $30 billion firm. That valuation is old, though, as Airbnb has plans to go public next year with an even bigger price tag. By contrast, Marriott – a well-established hotel chain all over the world – has a valuation of $46 billion. IHG, which owns venerable brands like Holiday Inn, has a market cap of $11.1 billion.

 

In 11 years, Airbnb is worth almost as much as Marriott, a 93-year-old company, and IHG, whose start was back in 1946 as InterContinental Hotels and Resorts.

 

In large part, due to Airbnb’s meteoric growth, many people have been suggesting that it may be replacing the hotel industry. Hotels are on the decline, and Airbnb rentals are trending upwards. While this is partly true, the real story is a little more complicated.

 

People Like Hotel Services

 

While Airbnb’s growth is exploding, many people still don’t use the platform because they miss hotel services. In particular, 38% of people who avoid sites like Airbnb do so because they prefer hotel services. 37% say they prefer hotel property amenities, and 17% are concerned about safety. 38% think staying in someone else’s home would be uncomfortable.

 

Hotels provide a level of anonymity, and there is some comfort in dealing with a faceless corporation that offers things like maid service. A hotel gives you a predictable experience, and you know what you’re going to get (within reason – sometimes even the most prominent chains have poor quality hotels in their portfolio).

 

The vanilla traditional Airbnb experience does not incorporate this level of hospitality. As such, traditional Airbnb rentals have a segment of the population with which they will never resonate. Of course, since Ayvio focuses on providing hotel-like hospitality to Airbnbs and Vrbos, our company solves these issues for this demographic.

Best Practices

Airbnb Is Cheaper And That Resonates

 

Airbnb is the less costly option when compared with hotels. A report by Ryerson University in Toronto in 2016 showed that Airbnb’s practical benefits, like cost, were at the top of many traveler’s minds. People who booked Airbnbs liked the low price and convenient location of the properties.

 

However, this report looked at Airbnb guests, not travelers as a whole. When you put the entire picture together, what you see are multiple types of travelers. Money savers have traditionally gone with Airbnb. Since there are so many people that like to save money, Airbnb has experienced significant growth over the past few years. However, people still want the hotel amenities, and those people have been sitting on the sidelines and avoiding Airbnb.

 

Blending Both Worlds

 

In the past, Airbnb was not replacing the hotel industry. It was siphoning off some of the money-saving customers, but there will always be a subset of travelers that want the hotel experience.

 

Ayvio, a hospitality company that focuses on short-term rentals, partners with property owners across the US, and we help them blend both worlds. We bring hotel-level hospitality to Airbnb rentals. The result is a higher ROI and a fantastic customer experience. Our brand of hospitality ensures that customers that want hotel-level service can still book Airbnbs!

Leave a Reply

Your email address will not be published. Required fields are marked *