Is Airbnb Really a Threat to Hotels?

By Matt Swenson, April 27, 2015

With more than 30 million users and a growing presence in the meetings market, Airbnb is seen as a huge threat to the hotel industry’s long-held dominance. Given that, it’s a bit jarring to hear one of Hilton Worldwide’s top executive’s reaction to the phenomenon.

“More power to them,” says Rob Scypinski, Hilton Worldwide’s senior vice president of industry relations and events.

More surprisingly, Scypinski is not being sarcastic.

That’s because he’s come to realize what’s good for Airbnb may be good for the entire events industry. He thinks a good deal of the website’s business is not pilfering from hotels and other traditional properties—a theory substantiated by the rise in hotel occupancy and price rates to pre-recession levels or higher.

None of this is news to Marc McCabe, a business development lead at Airbnb, who also says there is more than enough room for all parties involved. “We see ourselves as a very different product” than hotels, says McCabe. That’s not to say he thinks Airbnb doesn’t have value for corporate business travelers and meeting attendees.

Organically, business travelers have made up about 10 percent of Airbnb’s audience. That’s why the website created a portal solely for that sector and initiated a partnership with business travel agency Concur, which McCabe says allows travel managers to better track their attendees’ patterns and preferences.

As for being a threat to the classic room-block model planners rely on for contracts, McCabe doesn’t believe the gloom-and-doom predictions. While he acknowledges Airbnb’s combination of typically cheaper rates, larger spaces and locations that allow for a more local experience is appealing, he thinks Airbnb’s growth will come from attendees who extend their stays pre- or post-conference or are on extended-stay business trips. “Between five and 30 nights, there are not a ton of solutions on the market,” he says.

Otherwise, McCabe suggests Airbnb as an option to house C-level executives or for a group of attendees to rent as a spot to relax once the day’s business is done. For now, Scypinski says he appreciates how Airbnb has tapped into a market that otherwise might not be able to afford to leave town for a few days. His hope, and that of the hotel industry, is that the experience will whet appetites for more travel when they have a greater disposable income.

“It is bringing people to the travel window who may have never ventured there because of price,” he says of Airbnb. “We want more people traveling because they will become our customers, and they will want a different experience.”

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