1000 Travelers Reveal Airbnb's True Impact on the Travel Industry
By Ben Mizes CEO, Clever Real Estate | July 28, 2019
These are strange times for the hotel industry. Airbnb sprouted from a two-man startup to a $38 billion business virtually overnight by capturing a huge share of the vacation rental market. A lot of pundits said Airbnb would be the end of the hotels, and for a while, the mood was nearly apocalyptic.
But as time has passed, we've realized this isn't a case of an old-line industry being swiftly dispatched by an upstart, as when Netflix exterminated video stores. The hotel industry has taken a hit, but it still holds the lion's share of the market, though Airbnb is making steady inroads. This isn't a rout; it's an ongoing competition, and there are major competitive advantages that can be pressed by each side.
Clever Real Estate recently surveyed 1000 consumers who use both hotels and Airbnb, and we found that the hotel industry has a few vital edges over Airbnb that, with some savvy, could be exploited to great effect. So what's the most lucrative path forward? Let's look at some of the key takeaways from Clever's study, and their potential ramifications.
First, some sobering truths. When traveling for pleasure, consumers who use both hotels and Airbnb tend to prefer Airbnb; we found that 60% of vacationers prefer using Airbnb over a comparable hotel. But unpacking the data reveals an interesting wrinkle. Though pleasure travelers prefer Airbnb, there's no substantial difference in the level of satisfaction they report between Airbnb and hotels. These travelers gave an average rating of 4.2 stars to hotels, compared to 4.3 stars for Airbnb.
The preference for Airbnb tends to kick in immediately after a consumer uses it for the first time. A 2016 study by Goldman Sachs found that among people who used peer-to-peer lodging in the previous five years, the chances that they preferred traditional hotels plummeted from 79% to 40%, a shift that happened so fast that the analysts called it 'a 180' in their report.
So what's causing this abrupt shift? Professor David Guttentag, of the Ted Rogers School of Hospitality and Tourism Management, authored a 2016 study that identified five distinct types of Airbnb guests, and their respective motivations.