This year Airbnb, the original market disrupter, is taking greater aim at the hospitality industry by expanding its services in a bid to encourage more hotels to sign up. While the trading environment for both hoteliers and Airbnb operators is far from a level playing field, the platform does open up new opportunities for the traditional hotelier. We discover how to take advantage.
Airbnb was the first modern-day disrupter to hit the hotel market when it launched in 2008, pushing the already-fierce competition for trade into new realms. While growth in the hotel sector continued, it then began to be chipped away by brands such as Airbnb and HomeAway who had hit a sector niche just at the right time.
Providing an often cheaper alternative to traditional hotel rooms in city hotspots around the globe, Airbnb was offering more than just an overnight stay; it was an experience and the opportunity to live like a local, something that struck a chord with so many people during the boom of personalised travel.
Research from Colliers International found that the online platform accounted for more than 1.1 million overnight stays last year in Edinburgh, up 70% on the previous year as providers look to cash in on the demand for room nights in the city.
Hoteliers were ruffled, not just because Airbnb seemed to tempt consumers in a way that they struggled to adapt to, but because they argued that the rise of the selling platform presented an unlevel playing field in the market.
Since then, its unpreceded growth has seen tourist destinations around the world call for Airbnb to be regulated, caped, or even banned. Recently Edinburgh’s city council announced it would lobby the Scottish Government for a ‘licensing regime’ to potentially cap the number of Airbnb properties.
Hoteliers continue to lose out on revenue as a result and whilst hotels are hit with the cost of business rates, loopholes in rating legislation means Airbnb providers are able to avoid paying such rates, despite many operating in a similar way.
Regulatory change is beginning to happen in New York and San Francisco, where Airbnb has had to drop 50% of its listings as hoteliers’ fight back started to take effect.
In October, Bristol Hoteliers Association chief, Imran Ali, presented a four-point plan aimed at bringing Airbnb more in line with the hospitality sector, as the platform continues to have a significant impact on Bristol’s smaller hotels and B&Bs.
The points raised by the head of the Association, which represents 34 hotels in the city, included an optional, ward-based exclusion zone, which short-term letting operators must hold a license and are restricted to 170 days per year; and the assurance that Airbnb and the like are health and Safety compliant.
What originally started out as a platform for individuals to let out their own homes, has now, in some cases, become a profitable commercial venture whereby many people are buying residential properties specifically for use as Airbnb accommodation. In 2017, in London, around 62% of Airbnb listings were offered by hosts with more than one listing, up from 54% the year before and 48% in 2015.
Earlier this year, Airbnb took further aim at the hotel industry and OTAs as it bids to make a bigger imprint on the travel sector and go beyond shared accommodation. CEO Brian Chesky revealed in August that it will be expanding the type and quality of its listings, to make it easier for more hotels to list their services.
The company is also introducing four new rental categories, hiring people to vet higher-end listings and launching a loyalty program later in the year.
In August of last year, Chesky tweeted that Airbnb had listings for 15,000 boutique hotels, about 10 months after introducing them to the platform.
Then Airbnb announced a partnership with SiteMinder, a hotel distribution platform used by more than 28,000 hotels around the world.
The four new categories of listings — vacation home, unique space, B&B and boutique — will give hosts “an unprecedented level of detail in the travel industry” to showcase their properties, Airbnb said in a release.
While boutique, unique and individual hotels are welcomed on the site, Chesky stresses that attracting the multisite chain hotels is not on the agenda.
“We have to be more inclusive of who belong on Airbnb — but there’s also a flip side: Not everyone belongs on Airbnb,” Chesky said in December, during a global Q&A session.
“We want to have tighter host standards. Groups that provide mass-produced hospitality, who don’t offer belonging, who don’t care about what we care about — they don’t meet our standards, and they find somewhere else to do their business.”
Despite the start-up building its business as an anti-hotel alternative, the platform now offers more boutique hotel listings than ever before.
The official party line from Airbnb says that listings hosted by professional hospitality providers are ‘welcomed’, as long as they offer ‘unique spaces and personal hospitality to the Airbnb community’.
Lord Levan, owner of Mount Haven hotel says that the rise of Airbnb in Cornwall has helped bring more people to the region.
“The number of Airbnbs in the area has increased a lot,” he explains, “which has meant more people have come in. I don’t think the other hotels have lost out particularly, it’s just absorbed more people.”