If you’ve been following Airbnb and listening to some hotel representatives, you might believe that guests in hotel loyalty programs would never dream of booking a stranger’s apartment for a business trip or a weekend getaway. In 2014, Diana Oreck, Vice President of the Ritz-Carlton’s leadership and hospitality training center, told a Fast Company
reporter that she had never even heard of Airbnb. Why would she be worried? After all, don’t most Airbnb guests belong to the travel segment that doesn’t have the funds to stay in full-service hotels? Not so, says a new report from Morgan Stanley.
In a survey of 4,000 travelers who have used Airbnb
, 66 percent of respondents indicated that they earn more than $75,000 per year
. It’s safe to say that’s not the salary figure most might expect. However, it doesn’t necessarily mean that the typical Airbnb guest is using the peer-to-peer service instead of hotels. While 42 percent of respondents did indicate that they had used Airbnb instead of a traditional hotel, the data shows that Airbnb is also taking revenue away from bed and breakfasts, and it’s also giving guests who would have stayed with friends or family a new option. Morgan Stanley analysts also believe that the sharing economy site represents a bigger threat to online travel agencies than to hotel chains.
“We think investors overestimate Airbnb’s threat to hotels, but underestimate its threat to OTAs,” the report states.
Business Travel Could Be Big Business For Airbnb
The Morgan Stanley report highlights that the firm does not believe Airbnb will manage to take a big slice of corporate business travel revenue from hotels due to safety and privacy concerns. However, Airbnb is making a big push toward the business travel market with the launch of a new Business Travel Ready
program, which is designed to help travelers on the road for work easily identify properties that can accommodate the needs of corporate travelers. If a Business Travel Ready badge is next to a property, users will know that:
- The listing has five-star reviews for at least 60 percent of primary reviews, cleanliness reviews and accuracy reviews.
- The property has 24-hour check-in.
- The space is an entire home or apartment that does not allow smoking or pets.
- Wi-Fi, laptop-friendly workspace, smoke & CO detector, bath amenities and more are included.
- The host will not be able to cancel a confirmed reservation within seven days of the check-in date.
Is There A Loyalty Program In The Works?
I believe that Airbnb is going to continue to disrupt the travel industry, and despite Morgan Stanley’s predictions, I expect to see more corporate travelers use the service. For the longest time, though, there has been one big drawback to using Airbnb: the lack of a loyalty program. Regardless of age, budget and reason for traveling, hotel loyalty programs offer compelling ways to rack up points for free travel, and it’s felt like one of the big competitive advantages for the traditional hotel landscape. However, there was a recent a sign that Airbnb may be working to determine how to use its network of independent owners-operators to offer rewards for guests. A recently published (and then quickly unpublished) page on the site offered details on “The Airbnb Experience Card
.” It’s a prepaid card, and if the initially leaked info is true, cardholders would be able to earn 10 percent cash back in the form of Airbnb Travel Credits.
As Airbnb continues to evolve, it seems inevitable that more convention attendees will begin turning to the service. Check out “Why It’s Time To Start Thinking About Airbnb’s Impact On Your Room Block