Why Airbnb Might Not Be as Much of a Threat to Small Hotels as You Think

Why Airbnb Might Not Be as Much of a Threat to Small Hotels as You Think

Airbnb is everywhere. The company, which allows users to rent residential properties from people in most cities has gone mainstream.

A few short years ago and this disruptive startup was on the outside, mostly unknown to the world. Times have changed. As of this writing, Airbnb has amassed some truly impressive statistics. An estimated 700,000 hosts in 191 countries, 2.3 million listings, and a value nearing $30 billion dollars.

As Airbnb has remade the hospitality landscape over the last few years, the hotel industry has quietly mobilised to fight back. They’ve lobbied to get Airbnb fined, regulated and banned from some cities. In Berlin, for example, people who now rent out more than half of their flat short-term without proper permission from the city can be fined up to $100,000.

The American Hotel & Lodging Association has gone as far as releasing the following statement: ‘We aim to highlight the bad, unfair and in some cases unlawful business practices employed by short-term online rental companies.’

There is a power struggle and it’s been underway for awhile. If you’re a smaller accommodation or property owner you may be feeling caught in the crossfire. This, however, needn’t necessarily be the case.

A few things to consider:

  • Airbnb’s official line is that they are a complementary entity, whose goal is to work along hotels to expand the industry and enhance travel experiences.
  • Airbnb states that the industry as a whole has grown 7% since its inception and points to this figure as proof of the statement above. i.e. there is room for everyone.
  • Airbnb is open to partner with smaller players on cross-promotional deals.
  • Smaller properties can offer many of the things Airbnb travelers are after, plus housekeeping services and amenities. Airbnb travelers are experiential and small properties can offer tours, local advice, and cultural events. Thus, Airbnb is eager to strike up partnerships.
  • Some small hotels have anecdotally reported upticks in their direct bookings by listing their property on Airbnb. People have gotten wise to all the charges Airbnb imposes and if they see the name of a place they want to stay they may simply google it and book directly.

Whether or not you choose to fully buy into the bullet points above is up to you. Some will (and have) readily accepted Airbnb as another OTA others will resist. One thing is certain, Airbnb is a bit like the tide, and swimming with it may be the most successful strategy.