Airbnb can't compete directly with hotels for meetings business in terms of product, but it will be able to grab market share in the future by offering a degree of personalization that hotels can't match.
Chip Conley, head of hospitality and strategy at Airbnb, discussed the opportunities and challenges of room-sharing for meeting planners during his speech at a vendor conference in Las Vegas this week.
As we’ve written about previously, there’s a growing demand for Airbnb accommodations from conference attendees, based on the platform’s extensive variety of listings and overall value. Conley’s primary message stressed that room-sharing is the ultimate way for delegates to personalize their business travel experience.
He first explained that business travelers 10 years ago aspired toward staying in the most upscale accommodations above all else. Today, he said the number one priority has shifted to “discovery.” Therefore, Airbnb is positioned as a platform for exploration, for both leisure and business travelers, because there’s such a variety of listings located in so many different types of neighborhoods, providing greater access to more types of local travel experiences.
Conley’s speech, however, wasn’t meant to directly challenge the thousands of hotel professionals in the audience by promoting Airbnb as the next big thing in meetings and events. It was more of an introduction. It was basically an explanation of how Airbnb has grown so popular to date, and how it could impact the meetings industry as a “peripheral player.”
Airbnb’s Shift into Meetings
Kicking off his presentation, Conley highlighted a few historical events that foreshadowed the rise of Airbnb in an effort to put the room-sharing industry into perspective for those in the audience unfamiliar with the sector.
That included some of the first accounts of home-swapping in going back to the 1950s when Dutch and Swiss teacher unions suggested their teachers switch houses in the summer to save money on family vacations. And then in 1995, the launch of VRBO showed the potential of peer-to-peer vacation rentals to be a viable industry.
The surge of boutique hotels in the late 20th century also proved “there was a growing number of customers for whom predictability and ubiquity were not the right model,” Conley said. “Boutique hotels helped you live like a local, [but] they could be the best experience of your life or the worst experience of your life. And that’s true for Airbnb as well.”
So how does all of this impact meetings and events? Presently, not too much in terms of broad mainstream appeal.
Airbnb attracts “customers who are a little adventurous, especially in locations that they know already,” Conley explained. Those are the types of conference attendees that Airbnb is targeting. They’re people seeking accommodations that align with their personality and feed their individual travel tastes on a deeper level than any hotel could ever provide.
That said, Airbnb has inherent challenges as a digital platform when it comes developing official room blocks, consisting of pre-selected Airbnb listings packaged together for event planners and attendees.
“You can’t imagine what it’s actually like to get a room block — it’s like herding cats — with Airbnb hosts,” Conley said. “It’s not the same as working with a [hotel] director of sales & marketing and their inventory.”
Instead, Airbnb is promoting technology such as online widgets that planners can embed in their event websites to direct attendees to groups of Airbnb listings, which are available on specific event dates within a certain radius of the event venue. Meaning, the responsibility is on attendees to find their own Airbnb listing, versus booking directly inside the block.
It was interesting to hear how Conley strove to deliver a balanced overview of how Airbnb can partner with the meetings and events industry.
“We’ll always be predominately a leisure company,” explained Conley. “Why? Because core business travelers need proximity; easy check-in and check-out, and that’s not our forte; and services. And while we’re doing more and more services, we’ll never be as good as hotels, so this is a space where we’ll be sort of a peripheral player.”
Airbnb Is a Data Company
All of that might be true now, but Conley didn’t come to the conference to talk about the present.
He explained how he was brought to Airbnb three years ago to help shift Airbnb from a technology company to a hospitality company. Looking ahead to the future, Airbnb is developing into a global data company with the ability to leverage individual travel behavior data for millions of travel consumers.
Using companies like Amazon, Netflix, and Spotify as an example, Conley said, “The more you use their products, the more the companies know you… and can personalize the way they talk to you.”
In Airbnb’s case, consider that the company offers more than 75,000 listings in Paris alone, which results in a “paradox of choice” for travelers.
Airbnb is developing algorithms that can customize search results based on past booking behavior and deeper guest profiling combining personal preferences in myriad travel categories. Airbnb wants to get as granular as possible to the point where it knows if “you’re crazy about Edith Piaf,” Conley explained.
Additionally, Airbnb has data that it culls from host and guest reviews posted within its own digital platform, versus outsourcing that to third-party platforms like TripAdvisor, which is basically what hotels do.
So in the future, ostensibly, when an Airbnb user searches for a Paris listing, the company will be able to offer a customized stable of properties personalized to the individual user. And more importantly, Airbnb will also potentially suggest a full itinerary with things to do and people to meet who are experts in the subjects that the user is interested in, specific to the exact travel dates supplied.
“People want personalization, and being a data company helps us in that respect,” Conley said. “The home you choose to stay in says a lot.”
Imagine you’re a conference delegate planning to visit Paris. Airbnb supplies you with a business travel listing that aligns with your needs, matching you with a specific type of host in a specific kind of neighborhood near a specific selection of restaurants and attractions.
Suddenly this level of customization begins to look more and more attractive to a broader base of business travelers, because traditional hotel companies can’t offer the same degree of personalization.
At that point, which isn’t necessarily that far away, Airbnb perhaps becomes a little less of a peripheral player in the meetings sector.
Photo credit: Chip Conley's speech at Cvent Connect 2016 in Las Vegas. Skift