Airbnb was born in 2007 when Brian Chesky and Joe Gebbia did not have enough money to pay the rent for their apartment. Under the concept of “airbed and breakfast” they decided to launch a small website hoping to host guests during a design convention that was taking place in their city. During this small experiment they managed to receive 3 guests who paid $80 per night, thus managing to pay the rent.
Fourteen years have passed since then. What started as an idea to obtain additional income has become a company valued at more than 31 billion dollars. In addition, it has become a highly competitive space that requires professionalization in its management to achieve the results that hotels desire in a channel that generates more than 2.6 billion dollars in revenue.
In this blog we will discuss why my hotel should be listed on Airbnb and why it has become a channel with high potential for hotels. In addition, we will see what the implications of its professional management are for them.
Opportunities for hotels that appear on Airbnb
1. Attract new market segments
Airbnb has opened up the possibility for hotels to access new market segments that do not normally book through traditional hotel platforms. One of the segments that stands out in particular is long-stays. People who want to stay in a destination from a week to 6 months or a year and who have different needs. Hotels on Airbnb have understood that a 6-month guest does not necessarily want a rate with breakfast or to have their room cleaned every day.
Another particularly important segment for Airbnb is the pet-friendly segment. Guests are looking for properties where they can bring their pet, whatever it may be. On Airbnb, hotels have received messages from guests asking if the pet-friendly policy includes rabbits, birds, cats, or more than 3 dogs. Precisely because these are such specific needs, they prefer to book through Airbnb, as it is a channel that allows for greater interaction in the messaging service prior to booking.
As well as these, there are multiple other market segments. For example, the creative segment looking for locations to shoot, large families of more than 5 people looking for a spacious place where everyone can stay, or small groups looking to host celebrations such as birthdays or intimate weddings. To take advantage of these new markets, my hotel must appear on Airbnb!
2. Greater self-service with lower operating costs
One particularity of the Airbnb guest is that they are very independent. Guests usually do not need a large number of services such as breakfast, daily cleaning or 24-hour reception service. It is for this reason that in this post-Covid-19 reopening stage, many hotels that are not yet operating with all their staff and services find in this platform an opportunity to offer accommodation with lower operating costs. For example, there are hotels that do not yet have food and beverage service available, so they only offer accommodation. This makes their services more similar to those of an apartment or house, with the standards of a hotel. In the end, the value proposition ends up being favorable and shows us why our hotel should appear on Airbnb.
3. Growth of Short Term Rentals platforms
Finally, platforms like Airbnb have grown exponentially in recent years. With more than 2.9 million hosts, 7 million property listings and active listings in more than 100,000 cities, Airbnb has not only become one of the strongest platforms for online bookings alongside Booking or Expedia, but it has also opened the doors to new opportunities for hotels to access new markets by adapting their services and management.
Professional management and handling of the Airbnb platform
And how can you be competitive on a platform that has never been used before? Precisely by professionalizing its management and giving it professional handling with processes, people and adapted technology that allows for proper management. For this, hotel software such as LobbyPMS can be of great help.
1. Profile design and management
One of the biggest challenges for Airbnb is the design and management of the profile. This requires different elements than traditional hotel OTAs. New descriptions, an attention-grabbing title for the listing, carefully choosing the order of the photos, evaluating whether different photos are needed than those already available – all this before even going live.
2. Revenue management management
Once the property profile is established, it is necessary to use revenue management strategies to achieve competitive rates compared to the market. However, hotels have a particularity and that is the management of distribution in multiple online channels. This not only implies taking into account the rates that are going to be established on Airbnb, but also those of other channels. With a strategy and understanding of the demand and the different markets, a Channel Manager will be of great help in managing it.
3. Inventory management
Another key point is inventory management. Airbnb fines the property up to $100 when a guest cannot be accommodated due to overbooking or poor management of the hotel’s inventory. To do this, it is very helpful to have hotel software that allows for real-time closings on electronic channels. In this way, it is possible to close Airbnb availability when the same room has already been sold on Booking or vice versa.
This can be done through the integration of the Airbnb calendar and through a synchronization with “ical”, allowing these automatic closings to be generated in the PMS and not running the risk of overbooking. In addition, hotel software that allows an integration through “ical” does not generate additional charges by Airbnb for an integration via channel manager. This can cause the channel commission to rise up to 16% in some cases.
4. Management of requirements and follow-up to guests
Finally, professional management also requires being attentive to guest requirements and being able to monitor their arrival, stay and check-out. To do this, it is again very useful to have hotel software that allows changes in the operation or guest requirements to be visualized.
Airbnb has an advanced chat-like messaging service that allows the reservations manager or front desk to communicate with the guest easily. However, this messaging service does not allow for important notes to be saved about the guest’s stay, so if a staff member has not previously spoken to the guest, they would have to go back to the conversation over and over again to verify what exactly was offered. This is where hotel software should not only be useful in allowing for real-time viewing of reservations, but should also have the option to leave notes and alerts that can notify the team of any changes.
In this case, hotel software must not only be useful in allowing reservations to be viewed in real time, but it must also have the option of leaving notes and alerts that can inform the team of any changes.
In conclusion, Airbnb is a sales channel for hotels with extraordinary potential in new market segments and with lower operational costs and flexibility. However, professional management with appropriate tools is necessary for it to generate the desired potential income. Now, you are still asking yourself: Why should my hotel appear on Airbnb?
