Has Airbnb’s bubble burst yet?
Airbnb hosts are seeing bookings disappear since the summer travel season.
Based on the many emails I received, my recent story about Airbnb hosts becoming sick of Airbnb made a splash. Anti-Airbnb sentiment is rife, everywhere from Reddit and the Wall Street Journal.
The #Airbnbust seems, as with most social media phenomena to date, to be inaccurately reflecting what is actually happening in real life. According to an AirDNA report, the total demand for short-term rentals rose 24% in September, compared to the same month last years, according a recent survey. The average daily rate rose by an astonishing 31.9% in September compared to 2019.
Based on social media, it seems that everyone is fed-up with Airbnb. Based on the reality of the world, Airbnb is doing much better than ever. What’s the secret?
The Apple effect
Do you remember Apple’s “Batterygate?” scandal? The company was accused of “planned obsolescence” in 2017 (roughly 5500 years ago). This happened with software updates for iPhones. Apple was accused of deliberately slowing down older models in order to encourage customers to upgrade.
At the time, social media was rife with vitriol. iPhone users declared that they would switch to Android phones in droves. What happened? Apple was a $671-billion company in 2017, and its value has more than tripled to $2.5 trillion. So, um, no.
While they may not like all the services offered by these companies, Airbnb guests and Apple users will find that they prefer other options.
Android is a change of interface. You will also need to learn how to use iMessage. Switching from Airbnb is about either returning to hotels with their drawbacks or using Airbnb’s competition, which isn’t as good.
Airbnb is still a popular option for backpackers who want to travel through South America with a group of friends or book a place to stay in Palm Springs. There aren’t many other options.
Not yet, at least.
Lee Gonzalez and her sister Lauren are building hostels in America. I spoke to Lee Gonzalez. L&L hospitality opened two hostels in New York City, one in New York City, and another in Portland in 2021. She said that they struggled to accept the term “hostel” at first, but have since accepted it.
Gonzalez states that many travelers reject hostels in America. They think of the YMCA. “In the end we like the term. We want people to feel like a hostel span>
Lolo Pass, their Portland property is a departure from the stereotype hostel image. It features a grimy guy playing guitar in the common area and a grimy girl sleeping in a dorm. Loss Pass’s rooms are minimalist but elegant. The emphasis is on connecting guests to each other and the surroundings.
She explains that the programming is integrated into the local community. The spaces are as important for the neighbors as they are for guests .”
Gonzalez offered a list of reasons why her hostels could capture some of Airbnb’s market share when I asked. Her properties are clean, affordable, and free of cleaning fees. They are managed by on-site professionals. Hostels are more convenient than Airbnbs for little things like the ability to check out your bags and leave them behind after you have checked out.
As mentioned above, the biggest obstacle is getting over North Americans’ fear of hostels. Gonzalez believes that Airbnb is the catalyst for this change, particularly among younger travelers.
She explains that Aribnb “has actually paved the path for hostels in the U.S. to work by introducing the concept of shared spaces.” “Gen Z was brought up with Airbnb and doesn’t have the same preconceived notions about hostels as older people span>
Airbnb’s business model is only challenged by hostels. It attracts low-frills travellers looking for an affordable alternative to hotels. Legacy hotel brands won’t give up easily. A recent commercial by Hilton Hotels was aimed squarely at Airbnbers. It featured a creepy vacation rental filled with talking dolls while extolling the virtues of an old-fashioned hotelroom.
Maybe Airbnb is in need of some disruption. Airbnb is no longer the youthful upstart after turning the travel industry upside down 15 years ago. Perhaps a new model is emerging. The next step will depend on what we, the paying guests, decide to do.
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