Leveling the Playing Field to Attract the Airbnb Customer
By Dana Kravetz Managing Partner, Michelman & Robinson, LLP | July 2018
This year marks Airbnb's 10th anniversary. That's right, for a decade now, the hospitality industry maverick has been eating away at something that hoteliers hold dear – market share of lodging worldwide. And it has done so with abandon, finding a seat at the table amongst hotels and resorts in a space that was clearly ripe for disruption in the age of the sharing economy.
Since Airbnb's arrival on the scene, headlines have suggested real trouble for traditional hospitality players, big and small – couching the company as a significant threat and maybe even spelling doom for the hotel business. For those hoteliers who may have drank the "sky is falling" Kool-Aid, breathe easy.
Unlike the taxi industry, which has been devastated by the likes of Uber and Lyft, hotels and resorts continue to flourish – this despite Airbnb nipping at their heels. The proof: 2017 was yet another record-breaking year for the hotel industry here in the U.S., with the key performance metrics – occupancy, average daily rate (ADR), and revenue per available room (RevPAR) – higher than ever before measured by STR, the leading provider of information services to the hospitality segment.
The upshot: as Airbnb embarks on its second decade, the conversation amongst hoteliers should shift, and instead of overstated concern and worry, the emphasis must be on leveling the playing field by way of ongoing governmental regulation and proactive innovation by hotels and resorts to better attract the Airbnb customer.
A Booming Economy and Recession, All at the Same Time
You read that right; the economy is humming along, which is great news across sectors, including hospitality. With unemployment numbers at historic lows and given the uptick in household after-tax earnings, tourism and a resulting demand for hotel rooms are expected to rise well into next year.