The thing which grips the hotel sector the most about Airbnb is the lack of information about what it is. And where it is. You can see how a hotelier would become paranoid walking down the street; is that group of friends having dinner really from out of town? Should they have stayed in my hotel? Am I losing six heads in beds? Or are they just breaking lockdown?
And, as with many things we don’t understand, there has been a certain amount of animosity towards the platform, which has now been with us for 13 years, adding four million hosts along the way. And this animosity has expressed itself in lawsuits, in pointed letter writing and in funding pressure groups to say mean things about the platform and those who would use it.
Has it worked? Not so much. And now, with the IPO prospectus, we have some - not all - of the information the sector wanted. Airbnb recorded 327 million room nights and experiences last year and, although this was down 20% this year from July through September 2020, it’s not a number which can be ignored. It is certainly a number which needs finessing - including experiences, really? - but it’s still a significant number.
Even if you wanted to console yourself that these are just people flogging time on their sofas, it’s worth nothing that 92 million nights were in the hands of what Airbnb considers to be professional hosts. And bear in mind that Airbnb wants to present jurisdictions around the world - and guests buying into its homespun image - with the smallest possible number of ‘professional’ hosts so their definition of professional is likely to be a shade leaky.
With the equivalent of 67 nights of full occupancy across Marriott’s estate accounted for by professional hosts, is the platform a threat? Or are these, somehow, all brand new travellers who otherwise would be sat around in their pants catching up with The Wire?
The issue is less whether or not Airbnb has stolen guests away from hotels, but more about the mirror it has thrown up, most notably in customer service, which Airbnb hammered home in its prospectus.
Airbnb said: “Travel is one of the world’s largest industries, and its approach has become commoditised. The travel industry has scaled by offering standardised accommodations in crowded hotel districts and frequently-visited landmarks and attractions. This one-size-fits-all approach has limited how much of the world a person can access, and as a result, guests are often left feeling like outsiders in the places they visit.”
Have hotels learned from this? Accor has reworked Onefinestay and is expanding it - it benefitted from a strong domestic market in France over the summer, for example. And at Marriott International’s most-recent earnings call Arne Sorenson said that the company had seen increased demand amongst its Bonvoy members for whole home rentals during the pandemic, commenting that the group would build on the offering.
He said: “We will remain focused on whole home, warm weather, ski country, resort destinations. I am quite convinced that that will continue to grow substantially and it will be a nice complementary feature to the traditional hotel business for us.We have had conversations with some of our good partners about building new inventory in some of those resort markets.” So there is progress, the sector is starting to realise that it needs to address homesharing, but it's awfully slow.
One of the other fright-worthy pieces of news this week was from Bill Gates, who said that he thought that 50% of business travel would be lost, even after the pandemic. Now, a billionaire Gates may well be, but his insight isn’t flawless - look at Windows 95. That said, he’s pretty much eradicated polio so he’s worth five minutes of anyone’s day.
No-one knows what the impact of the pandemic will be on business travel. What we do know is that, at the very least, airlift will not return to pre-pandemic levels immediately, which is going to slow down the global business folk who the large global operators like to put in their hotels and lock into their loyalty programmes. The spotlight will remain on leisure for longer and if you dabble in leisure, you cannot discount Airbnb. Early signs of the response to the prospectus suggest that investors certainly won’t be.