Airbnb no longer wants its guests to “forget hotels.”
During its earnings call last week, the multi-billion-dollar company founded on the radical idea of peer-to-peer lodging announced that it will feature hotels in more than 60 destinations. The official launch of its hotel division is a complete reversal of its founding principles — and tagline.
“This is not a pivot,” said Sean O’Neill, senior hospitality editor at Skift. “It’s almost like a religious conversion.”
Airbnb and hospitality experts say the hotels are filling a vacancy left by home shares. In recent years, many cities struggling with overtourism or a housing crisis, such as New York, Barcelona and Amsterdam, have passed stringent laws on short-term rentals, curtailing — if not outright banning — the practice. By offering hotels in these markets, the company can prevent guests from abandoning its platform for a more general booking site, such as Expedia or Booking.com.
“A lot of short-term rental regulations are getting tighter, so Airbnb is not allowed to really do its home-sharing business freely,” said SooCheong Jang, a professor at the White Lodging-J.W. Marriott School of Hospitality and Tourism Management at Purdue University in Indiana. “So, they are taking some action against this.”
The hotels also provide an option for people who do not need an entire home for their trip, such as business travelers or singles or couples slipping away for a mini-vacation. In these instances, a hotel room with no cleaning fees or checkout chores might be a better fit.
Despite the expansion, and the overthrow of its anti-hotel ideologies, Airbnb isn’t vying to become the next big online travel agency, according to lodging insiders. The company said it is listing only “independent and boutique hotels” that offer a personal touch or local experience similar to a home-share stay.
“Airbnb isn’t trying to be Expedia in the sense that Expedia wants to essentially list every hotel in the world,” O’Neill said. “Airbnb doesn’t think that whoever has the most beds in the end wins. Instead, it’s trying to have curated listings of places with a distinctive lifestyle.”
In a spot search, many of the hotels seem to embrace the spirit of vintage Airbnb, such as the Pontchartrain Hotel in New Orleans, the Inn at Venice Beach in Los Angeles and the Hotel Provocateur in Berlin. Others — the Hyatt Regency Times Square, for instance, or the Sonesta Emeryville-San Francisco Bay Bridge — skew toward Booking.com.
Airbnb’s history with hotels
For at least a decade, hotels have been quietly appearing on Airbnb, posing as short-term rentals.
The commercial properties will typically advertise a “room,” a descriptor commonly used by homeowners, and reveal its brand name under “hosted by,” such as “Hosted by Holiday Inn Express Suites in Charlotte.” Some accommodations — again, the Holiday Inn Express — have even reached “superhost” status. The accompanying photos are usually a dead giveaway: a lobby with a front-desk counter, mass-produced furniture, an exterior emblazoned with a brand name or logo like an H on a green square.
In 2019, Airbnb started to play a more active and open role in the hotel domain. It purchased HotelTonight, the last-minute booking site and app, and integrated some of its technology in a pilot test in three cities. In May, the company officially announced its foray into the travel sector it once shunned. Six months later, it tripled down on its hotel venture.
Airbnb features 25,000 hotels, including the 5,563 hotels in its new lodging category, according to Jamie Lane, chief economist with AirDNA, a data and analytics company that specializes in short-term rentals. In total, it has more than 9 million active listings worldwide. On the earnings call, co-founder and CEO Brian Chesky said Airbnb’s hotel division is growing “markedly faster” than its home-share business. The company does not want to replace home shares with hotels but is using the commercial properties as a lure, according to hotel insiders.
“As a platform, they have so many people coming to their site who end up leaving without booking something,” Lane said. “With this additional inventory, they could convert them, and then if they book a hotel first on Airbnb, they may eventually come back and book a home.”
To find hotels in the thicket of homes, click on the icon of a bellhop luggage cart or look for profiles with a green tag displaying the Airbnb credit amount. The profile allows guests to choose a room style, a feature unique to this category.
As an incentive, each booking includes a 15 percent credit that can be used on future accommodations (all types), experiences and services, such as a car rental, makeup session or personal chef. Similarly, travelers who book on HotelTonight receive a 10 percent credit. The company also offers a price-match guarantee, paying the difference in Airbnb credits.
Should you book a hotel on Airbnb?
If you are an Airbnb loyalist, booking a hotel on the site is a match. If you want a generic chain hotel or have ethical issues with the company, you should look elsewhere.
“A lot of cities want them out, a lot of residents want them out, a lot of travelers will not use them because they don’t want to support their kind of strategy for taking over rental properties and pricing out residents,” Jang said.
Sandy C. Chen, a professor of hospitality and tourism at Ohio University, enumerated several user disadvantages, such as a shallower pool of hotels compared with the online travel agencies’ inventory, inconsistent cancellation terms and the inability to collect a hotel brand’s loyalty points. “Customer-service responsibilities may be split between the hotel and platform,” she added.
Price-wise, hospitality experts say the rates should be comparable to the hotel’s or online booking sites.
“Consumers should compare the full price, including taxes, fees, cancellation restrictions and included amenities, with both the hotel’s direct website and competing [online travel agencies],” Chen said. “A lower advertised nightly rate is not necessarily the best overall value.”
In my sample test, Airbnb did not reign in the battle for the best price. For a midweek November stay at the Pontchartrain Hotel in New Orleans, its rate started at $248 with taxes, plus a $26 credit. (Sign into your profile and you may discover a surprise credit; my rate, for instance, was $225.) Rooms booked directly through the hotel started at $225, a few bucks cheaper than on Booking.com.
As an alternative, I found a charming private suite two miles from the French Quarter for $136 a night. The accommodations in the historic shotgun house have deep roots in New Orleans — and Airbnb — traditions.
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