Millions of Bookings Close to Home

The pandemic brought tourism to a halt. Then Airbnb noticed a shift that might have saved its business — people were booking millions of rentals close to home.

The challenges and opportunities we’ll discuss in this insight were informed by a Wall Street Journal article that ran on Tuesday, October 13,  2020.

As the travel industry works to find its footing, Airbnb’s pandemic reboot proves people still want to travel, but just not too far from home. And often where they can still work during their trip.

Love them or hate them, Airbnb is providing some guidance in these uncertain times. Their biggest observation from closely studying analytics led to major changes:

Big cities vis­ited by tourists had previously been Airbnb’s strength. But early in the pandemic analytics indicated that urban res­i­dents were search­ing for va­ca­tion rentals in neigh­bor­ing towns and cities. By June, the com­pany had re­designed its web­site and app so its al­go­rithm would show prospec­tive trav­el­ers every­thing from cab­ins to lav­ish beach houses near where they lived. In Au­gust, more than half of book­ings made were for stays within 300 miles of the guest’s lo­ca­tion, ac­cord­ing to the com­pany. 

Brian Chesky, the CEO of Airbnb, noted several big takeaways from his pandemic pivot. We can all take a few lessons from his experience: 

  • The most important takeaway: Move quickly. It’s imperative to keep up with a chang­ing in­dus­try.
  • Focus on your core business. Don’t overex­tend spend­ing on mar­ket­ing, staffing, or non­core projects.
  • Listen to your cus­tomers—in Airbnb’s case, both trav­el­ers and prop­erty own­ers. 
  • Keep communication channels open. After laying off 25% of its staff, the CEO in­creased com­mu­ni­ca­tion with remaining em­ploy­ees, switch­ing to weekly Q&As from monthly.

Not out of the woods yet.

While Airbnb has seen a slow but steady recovery since their pandemic pivot, they definitely have challenges cut out for them:

  • Based on their demonstrated history of spending with often reckless abandon, they must remain disciplined enough to keep costs down.
  • They will need to stick to their core busi­ness rather than on pre-pandemic forays into TV shows, feature films, developing Experiences, etc.
  • Cities are continuing to weigh­ zon­ing re­stric­tions on short-term rentals.
  • Due to their nature, Airbnb still strug­gles to po­lice crime and safety on its list­ings.
  • Relying solely on individual hosts for their inventory leaves them open to an unpredictable future of growth. 

The Business of Business Travel

“9/11 was be­fore Zoom.”

Brian Chesky, CEO of Airbnb

According to Chesky, he believes “The line be­tween travel and work­ing is blur­ring.” He feels the in­dus­try at large was bet­ting on busi­ness travel re­cov­er­ing faster than leisure, be­cause that’s what hap­pened the last time travel shut down in the wake of 9/11. Chesky has been bet­ting on the op­po­site, for a sim­ple rea­son: “9/11 was be­fore Zoom,” he said.

As we all plod along through a pandemic with an uncertain end in sight, we can take heed of one anecdote: people want to travel. Read, follow rabbit holes, and consider all that you can find that you think applies to your organization. Curate and regularly share your observations with your stakeholders and industry colleagues. If you would like to discuss your situation with an objective travel and tourism resource, we are offering 3 free one-hour consultation call slots per week to brainstorm with you on your situation. To book an upcoming consultation slot, contact us.

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