9 ms·

Analysis Shows Hotels Are Not Losing Share to Airbnb

76 points by silvialisam 10y ago

visarga 10y ago
So both hotels and AirBnb are growing, but that doesn't mean AirBnb isn't taking a large share of the profits. I used to go to hotels when travelling, but in the last few years it has been only AirBnb. I am much more satisfied with the quality of service and being closer to the local culture.
jacalata 10y ago
This is a terribly uncompelling attempt at analysis and I can only assume that they began by writing the headline and then went and looked at the data.
- bkor 10y ago
  The link points to another blog which points to http://hotelnewsnow.com/Articles/77191/New-Airbnb-data-sheds-light-on-13-global-markets http://hotelnewsnow.com/Articles/77191/New-Airbnb-data-sheds.... Still very unconvincing.
  - jacalata 10y ago
    Yea, I read the whole report before making my comment. Terrible.
- coredog64 10y ago
  I assumed that was the norm in modern journalism.
sschueller 10y ago
I think hotels are loosing money because sites like booking.com charge insane fees (35% is not uncommon [1]) and the hotels don't have their own mega portal. Some of which will give you better ranking on their site if you pony up more percentage. If you are looking to book a hotel I would find what the price is on one of these sites and then call the hotel to negotiate a lower price. You get a better price and the hotel gets more money. [1] https://www.quora.com/How-much-commission-is-booking-com-charging-their-partner-hotels https://www.quora.com/How-much-commission-is-booking-com-cha...
- nothrabannosir 10y ago
  Anecdotally, I never do this anymore since a hotel manager bumped me in a double booking, in favour of someone from a portal. He explicitly told me: "yes, but they can leave a bad review." Lesson learned.
- saiya-jin 10y ago
  booking.com is one of the worst things currently for owners - they are ridiculously backwardish, all processes takes weeks/months instead of hours like with airbnb, super expensive and on top of that, they don't even facilitate payments - so you either ask people to bring a lot of cash, or somehow obtain credit card reader (and go through all the hassle that comes with it, which I won't). to sum it up, I do believe and hope booking.com will slowly die, since other services are just better in every single aspect.
  - te_chris 10y ago
    See, I normally prefer booking.com to Airbnb in Europe because airbnb is full of crappy apartments whereas booking.com tends to mostly list professional Bnb's where you get breakfast etc, less hassle with keys, someone on site. YMMV. Maybe I'm just blind because I have a good income and can afford it, but I much prefer the experience of bnb's and hotels. Airbnb is fine if you're with a group and partying, but is a sub par way to stay in a city imo. Also, in Paris, e.g., the airbnbs tend to be booked out way in advance and often much more expensive than hotels.
    - saiya-jin 10y ago
      OK then we have different experiences, but from different positions and places too. My comment was from the point of host (sorry if not clarified before) - dealing with booking.com is ridiculous, their charges are way above any other service, yet you have to do the payment yourself for example (major hassle). If hosts have to pay up to 30% booking fee for sub-par services (just because, you know, we are booking.com, so f__k you), guess who ends up paying for it? Not the owners, that's for sure... I agree that airbnb may end up being more pain in some places, if hosts are too restrictive (ie requiring passport scans, 24h pre-approvals etc.) - but this is optional, non-default setup that they chose for whatever reason. I don't do this for my place, instant booking without prejudice :)
rmason 10y ago
AirBnB's marketshare is coming out of someone. Travel habits are changing and it may take awhile for them to be observed clearly. I clearly remember the newspaper industry doing a survey in the late nineties showing that the Internet wasn't materially hurting their business. Then sometime after 2003 the industry fell off a cliff.
- toyg 10y ago
  To be fair, it's not like the holiday home-rental market didn't exist before Abnb. My family spent 15 years using that market - you only needed another family to share a house or large flat, to make it extremely cheap compared to hotels. My guess is that Abnb has killed the advertising industry in that segment (some of which was/is state-funded in many Euro countries). People also travel a lot more these days thanks to cheap flights (which have just gone through years of low fuel prices) and higher disposable income, so the holiday market as a whole is expanding.
  - nappy 10y ago
    Access to information and the ability to quickly book will also lead to increases in efficiency
- nappy 10y ago
  It's possible more people are traveling than before, or using airbnb/vrbo/others vs cash transactions, or that providing more capacity, especially at high demand times, brings more supply online at peak times.
- onion2k 10y ago
  I've said this for years, but the simple fact is you can't build a unicorn business by taking market share from other businesses. You have to grow the market. AirBNB have done this by lowering the cost of staying somewhere, and offering something different to traditional accommodation, to the point where lots of new people have started entering the market and people who were already occasional travellers have started travelling more. Their marketshare isn't coming from other businesses, it's that the market is $billions of dollars bigger.
blunte 10y ago
If the data only comes from Airbnb, I'm not sure how much I trust it given their suspicious behavior with New York data - http://www.businessinsider.com/airbnb-deleted-rentals-before-showing-data-2016-2?international=true&r=US&IR=T http://www.businessinsider.com/airbnb-deleted-rentals-before...
torrent-of-ions 10y ago
> Hotels have much higher year-round occupancy due to the diverse nature of their business (leisure, business, and group). What is "group"?
- mikeyouse 10y ago
  Group reservations are usually for weddings / graduations / anniversaries, etc.
dlss 10y ago
Finally an article that answers some pressing societal questions: * Can hostfully.com identify suspicious data analysis? (no.) * If given the chance, will Airbnb present misleading data for self-serving ends? (yes.) * Will an already self-serving study be given an even more self-serving spin when presented by a sympathetic reporter? (yes.) To understand what I'm talking about, consider the source cited by OP (http://hotelnewsnow.com/Articles/77191/New-Airbnb-data-sheds-light-on-13-global-markets http://hotelnewsnow.com/Articles/77191/New-Airbnb-data-sheds...). Going by that data we might be tempted to say that Airbnb is being out-competed by the hotel industry. However, stagnant growth on the part of AirBnb seems like it would have been widely reported. And yet it hasn't. Googling we find a seemingly contradictory datapoint: Airbnb's revenue is up 89% this year (http://www.bizjournals.com/sanfrancisco/news/2016/09/01/airbnbs-revenue-soars-compared-to-hotels.html http://www.bizjournals.com/sanfrancisco/news/2016/09/01/airb...). How can Airbnb's revenue have almost doubled while still losing market share across the board? Option 1. They didn't lose market share across the board, and instead cherry picked non-representative markets for their 13 region hotel comparison. Option 2. They lost large numbers of low-margin bookings across the board, while gaining (taking market share from hotels) higher margin bookings. [Note this would contradict OP's article.] In both cases, Airbnb's data is misleading.
- MaysonL 10y ago
  It is interesting, nonetheless, that the past two years have been the best on record for hotels, as far as their occupancy rate is concerned. (http://www.calculatedriskblog.com/2016/10/hotels-occupancy-rate-on-track-to-be_17.html http://www.calculatedriskblog.com/2016/10/hotels-occupancy-r...)
  - sametmax 10y ago
    Except I'm on one of the biggest touristic area in France, and hotels here a loosing customers. We got less tourists than before, and I can see many people using RBNB. In the mean time, some people close to me are talking about being fired from their hotel because of the economy. While I know my situation is not a representative sample, I do travel a lot and observed the same thing in various places, including other countries. I discussed it with other travelers, and they reported the same. So I wouldn't conclude that everything is ok for hotels. The story needs more data.
xchaotic 10y ago
Bad analysis. Nowadays, my bookings are 50/50 split between regular hotels and apartment rentals. I would have stayed in hotels 100% if there was no alternative.
antirez 10y ago
So I've a bunch of friends than when traveling used to go to Hotels and now go to AirBnb. While anecdotical, this is more convincing than data from AirBnb cherry picked to show a seemingly hard to make point.
- soulnothing 10y ago
  I've seen this as well. Alot of my friends are using Airbnb vs hotels. I've seen two reasons. One is solely fiscal the cost savings. The other is being treated more like a local. By that I mean hotels I usually hear of locations that feel touristy. While hosts direct to local venues. I'm a fringe point, Ive always preferred saving money for experience. So I'm used to hostels, couch surfing, etc. I would only touch hotels if it was part of a rewards program. I'm also a host. My rooms are priced at 12 and 25 a night. I've noticed two trends and seen it backed up via host forums. Firstly travelers are expecting hotel quality at a fraction of the price. They're expecting travel toiletries, clean to the point of shining. I purchased a number of travel size soaps and one customer raided my entire supply. This stuff adds up. I can buy some items in bulk. But not at the discount rate of hotels. I also offer food when I'm making it. Some customers outright asked me where's breakfast. Oddly ive seen this primarily with younger people. Older, 40+, join the household. Cook with us and buy ingredients. Secondly I'm seeing Airbnb as a short term rental place. After 2 weeks listed I had one room booked for 6 months the other for 4 months. These are largely people who are just moving to the area, and finding their grounding. Or I've seen a lot of visas doing short term contracts. I can pretty much boil my listing down too. Either a short term rental. Or a stopping point between Philadelphia and Baltimore/DC.
  - harrisonmalone 10y ago
    I definitely agree with the short term rental stuff. When I came on a J1 visa I was told to Airbnb for a few days while I sorted out an address.
  - dismantlethesun 10y ago
    > Some customers outright asked me where's breakfast. Oddly ive seen this primarily with younger people. I'll blame that on the AirBnB name itself. BnB implies Bed and Breakfast, so people might rightly expect that breakfast would be served. I think it'd be better if both sides---consumer/suppliers---looked at AirBnB offerings as a bed and breakfast or a vacation rental, but never as a straight up hotel or couchsurfing replacement.
hsx 10y ago
This doesn't surprise me in the least. Businesses will still much rather use trusted hotels than Airbnb hosts.
ComteDeLaFere 10y ago
Simple common sense pretty much negates this headline and its premise. To be honest, I can't say that I have a compelling interest in protecting hotel market share. As a resident of NYC, however, I do have an interest in protecting my relatively cheap (but in-the-real-world-expensive-as-hell) rent. I see more and more people with suitcases leaving and entering buildings in the neighborhood, and I have to wonder what that is doing to rent prices. It's still a gut thing right now, but the case feels like it's getting more compelling.
nojvek 10y ago
I was a big believer in Airbnb but I've had some really bad experiences. The refund policy favors host over guest. The prices are usually on par or higher than hotels. Service can be really bad. It feels after growing airbnb lost its ethos.
wyc 10y ago
In the Innovator's Dilemma framework, entrant firms typically attack the bottom of the market first and will not steal business from the likes of Marriot or Hilton until later in the game, where their services improve to the point of "good enough" for the existing hotel consumers.
spectrum1234 10y ago
Well this study is obviously wrong. Myself and many others use Airbnb strictly in place of hotels.

76 points by silvialisam 10y ago

So both hotels and AirBnb are growing, but that doesn't mean AirBnb isn't taking a large share of the profits. I used to go to hotels when travelling, but in the last few years it has been only AirBnb. I am much more satisfied with the quality of service and being closer to the local culture.

jacalata 10y ago

This is a terribly uncompelling attempt at analysis and I can only assume that they began by writing the headline and then went and looked at the data.

bkor 10y ago
The link points to another blog which points to http://hotelnewsnow.com/Articles/77191/New-Airbnb-data-sheds-light-on-13-global-markets http://hotelnewsnow.com/Articles/77191/New-Airbnb-data-sheds.... Still very unconvincing.
- jacalata 10y ago
  Yea, I read the whole report before making my comment. Terrible.
coredog64 10y ago
I assumed that was the norm in modern journalism.

sschueller 10y ago

I think hotels are loosing money because sites like booking.com charge insane fees (35% is not uncommon [1]) and the hotels don't have their own mega portal. Some of which will give you better ranking on their site if you pony up more percentage. If you are looking to book a hotel I would find what the price is on one of these sites and then call the hotel to negotiate a lower price. You get a better price and the hotel gets more money. [1] https://www.quora.com/How-much-commission-is-booking-com-charging-their-partner-hotels https://www.quora.com/How-much-commission-is-booking-com-cha...

nothrabannosir 10y ago
Anecdotally, I never do this anymore since a hotel manager bumped me in a double booking, in favour of someone from a portal. He explicitly told me: "yes, but they can leave a bad review." Lesson learned.
saiya-jin 10y ago
booking.com is one of the worst things currently for owners - they are ridiculously backwardish, all processes takes weeks/months instead of hours like with airbnb, super expensive and on top of that, they don't even facilitate payments - so you either ask people to bring a lot of cash, or somehow obtain credit card reader (and go through all the hassle that comes with it, which I won't). to sum it up, I do believe and hope booking.com will slowly die, since other services are just better in every single aspect.
- te_chris 10y ago
  See, I normally prefer booking.com to Airbnb in Europe because airbnb is full of crappy apartments whereas booking.com tends to mostly list professional Bnb's where you get breakfast etc, less hassle with keys, someone on site. YMMV. Maybe I'm just blind because I have a good income and can afford it, but I much prefer the experience of bnb's and hotels. Airbnb is fine if you're with a group and partying, but is a sub par way to stay in a city imo. Also, in Paris, e.g., the airbnbs tend to be booked out way in advance and often much more expensive than hotels.
  - saiya-jin 10y ago
    OK then we have different experiences, but from different positions and places too. My comment was from the point of host (sorry if not clarified before) - dealing with booking.com is ridiculous, their charges are way above any other service, yet you have to do the payment yourself for example (major hassle). If hosts have to pay up to 30% booking fee for sub-par services (just because, you know, we are booking.com, so f__k you), guess who ends up paying for it? Not the owners, that's for sure... I agree that airbnb may end up being more pain in some places, if hosts are too restrictive (ie requiring passport scans, 24h pre-approvals etc.) - but this is optional, non-default setup that they chose for whatever reason. I don't do this for my place, instant booking without prejudice :)

rmason 10y ago

AirBnB's marketshare is coming out of someone. Travel habits are changing and it may take awhile for them to be observed clearly. I clearly remember the newspaper industry doing a survey in the late nineties showing that the Internet wasn't materially hurting their business. Then sometime after 2003 the industry fell off a cliff.

toyg 10y ago
To be fair, it's not like the holiday home-rental market didn't exist before Abnb. My family spent 15 years using that market - you only needed another family to share a house or large flat, to make it extremely cheap compared to hotels. My guess is that Abnb has killed the advertising industry in that segment (some of which was/is state-funded in many Euro countries). People also travel a lot more these days thanks to cheap flights (which have just gone through years of low fuel prices) and higher disposable income, so the holiday market as a whole is expanding.
- nappy 10y ago
  Access to information and the ability to quickly book will also lead to increases in efficiency
nappy 10y ago
It's possible more people are traveling than before, or using airbnb/vrbo/others vs cash transactions, or that providing more capacity, especially at high demand times, brings more supply online at peak times.
onion2k 10y ago
I've said this for years, but the simple fact is you can't build a unicorn business by taking market share from other businesses. You have to grow the market. AirBNB have done this by lowering the cost of staying somewhere, and offering something different to traditional accommodation, to the point where lots of new people have started entering the market and people who were already occasional travellers have started travelling more. Their marketshare isn't coming from other businesses, it's that the market is $billions of dollars bigger.

blunte 10y ago

If the data only comes from Airbnb, I'm not sure how much I trust it given their suspicious behavior with New York data - http://www.businessinsider.com/airbnb-deleted-rentals-before-showing-data-2016-2?international=true&r=US&IR=T http://www.businessinsider.com/airbnb-deleted-rentals-before...

torrent-of-ions 10y ago

> Hotels have much higher year-round occupancy due to the diverse nature of their business (leisure, business, and group). What is "group"?

mikeyouse 10y ago
Group reservations are usually for weddings / graduations / anniversaries, etc.

dlss 10y ago

Finally an article that answers some pressing societal questions: * Can hostfully.com identify suspicious data analysis? (no.) * If given the chance, will Airbnb present misleading data for self-serving ends? (yes.) * Will an already self-serving study be given an even more self-serving spin when presented by a sympathetic reporter? (yes.) To understand what I'm talking about, consider the source cited by OP (http://hotelnewsnow.com/Articles/77191/New-Airbnb-data-sheds-light-on-13-global-markets http://hotelnewsnow.com/Articles/77191/New-Airbnb-data-sheds...). Going by that data we might be tempted to say that Airbnb is being out-competed by the hotel industry. However, stagnant growth on the part of AirBnb seems like it would have been widely reported. And yet it hasn't. Googling we find a seemingly contradictory datapoint: Airbnb's revenue is up 89% this year (http://www.bizjournals.com/sanfrancisco/news/2016/09/01/airbnbs-revenue-soars-compared-to-hotels.html http://www.bizjournals.com/sanfrancisco/news/2016/09/01/airb...). How can Airbnb's revenue have almost doubled while still losing market share across the board? Option 1. They didn't lose market share across the board, and instead cherry picked non-representative markets for their 13 region hotel comparison. Option 2. They lost large numbers of low-margin bookings across the board, while gaining (taking market share from hotels) higher margin bookings. [Note this would contradict OP's article.] In both cases, Airbnb's data is misleading.

MaysonL 10y ago
It is interesting, nonetheless, that the past two years have been the best on record for hotels, as far as their occupancy rate is concerned. (http://www.calculatedriskblog.com/2016/10/hotels-occupancy-rate-on-track-to-be_17.html http://www.calculatedriskblog.com/2016/10/hotels-occupancy-r...)
- sametmax 10y ago
  Except I'm on one of the biggest touristic area in France, and hotels here a loosing customers. We got less tourists than before, and I can see many people using RBNB. In the mean time, some people close to me are talking about being fired from their hotel because of the economy. While I know my situation is not a representative sample, I do travel a lot and observed the same thing in various places, including other countries. I discussed it with other travelers, and they reported the same. So I wouldn't conclude that everything is ok for hotels. The story needs more data.

xchaotic 10y ago

Bad analysis. Nowadays, my bookings are 50/50 split between regular hotels and apartment rentals. I would have stayed in hotels 100% if there was no alternative.

antirez 10y ago

So I've a bunch of friends than when traveling used to go to Hotels and now go to AirBnb. While anecdotical, this is more convincing than data from AirBnb cherry picked to show a seemingly hard to make point.

soulnothing 10y ago
I've seen this as well. Alot of my friends are using Airbnb vs hotels. I've seen two reasons. One is solely fiscal the cost savings. The other is being treated more like a local. By that I mean hotels I usually hear of locations that feel touristy. While hosts direct to local venues. I'm a fringe point, Ive always preferred saving money for experience. So I'm used to hostels, couch surfing, etc. I would only touch hotels if it was part of a rewards program. I'm also a host. My rooms are priced at 12 and 25 a night. I've noticed two trends and seen it backed up via host forums. Firstly travelers are expecting hotel quality at a fraction of the price. They're expecting travel toiletries, clean to the point of shining. I purchased a number of travel size soaps and one customer raided my entire supply. This stuff adds up. I can buy some items in bulk. But not at the discount rate of hotels. I also offer food when I'm making it. Some customers outright asked me where's breakfast. Oddly ive seen this primarily with younger people. Older, 40+, join the household. Cook with us and buy ingredients. Secondly I'm seeing Airbnb as a short term rental place. After 2 weeks listed I had one room booked for 6 months the other for 4 months. These are largely people who are just moving to the area, and finding their grounding. Or I've seen a lot of visas doing short term contracts. I can pretty much boil my listing down too. Either a short term rental. Or a stopping point between Philadelphia and Baltimore/DC.
- harrisonmalone 10y ago
  I definitely agree with the short term rental stuff. When I came on a J1 visa I was told to Airbnb for a few days while I sorted out an address.
- dismantlethesun 10y ago
  > Some customers outright asked me where's breakfast. Oddly ive seen this primarily with younger people. I'll blame that on the AirBnB name itself. BnB implies Bed and Breakfast, so people might rightly expect that breakfast would be served. I think it'd be better if both sides---consumer/suppliers---looked at AirBnB offerings as a bed and breakfast or a vacation rental, but never as a straight up hotel or couchsurfing replacement.

hsx 10y ago

This doesn't surprise me in the least. Businesses will still much rather use trusted hotels than Airbnb hosts.

ComteDeLaFere 10y ago

Simple common sense pretty much negates this headline and its premise. To be honest, I can't say that I have a compelling interest in protecting hotel market share. As a resident of NYC, however, I do have an interest in protecting my relatively cheap (but in-the-real-world-expensive-as-hell) rent. I see more and more people with suitcases leaving and entering buildings in the neighborhood, and I have to wonder what that is doing to rent prices. It's still a gut thing right now, but the case feels like it's getting more compelling.

nojvek 10y ago

I was a big believer in Airbnb but I've had some really bad experiences. The refund policy favors host over guest. The prices are usually on par or higher than hotels. Service can be really bad. It feels after growing airbnb lost its ethos.

wyc 10y ago

In the Innovator's Dilemma framework, entrant firms typically attack the bottom of the market first and will not steal business from the likes of Marriot or Hilton until later in the game, where their services improve to the point of "good enough" for the existing hotel consumers.

spectrum1234 10y ago

Well this study is obviously wrong. Myself and many others use Airbnb strictly in place of hotels.