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Hundreds of the travel industry’s most-forward-thinking executives will gather for our third annual Skift Forum Europe in London on April 30. In just a few years, Skift's Forums — the largest creative business gatherings in the global travel industry — have become what media, speakers, and attendees have called the “TED Talks of travel.”
Focusing on responsible travel practices and other key issues, Skift Forum Europe 2019 will take place at Tobacco Dock in London. The Forum will feature speakers, including CEOs and top executives from British Airways, IHG, Thomas Cook, Booking.com, TripAdvisor, Silversea, Uber, and many more.
The following is part of a series of posts highlighting some of the speakers and touching on issues of concern in Europe and beyond.
One of the biggest stories in the travel industry this year involves Airbnb and its perceived battle with Booking Holdings to assume the title of being the No. 1 platform for private accommodations in the world, or simply being the No. 1 online travel company.
While it’s clear there is a battle brewing between the two online travel giants, Jeroen Merchiers, Airbnb’s managing director for Europe, the Middle East, and Africa (EMEA), thinks there’s plenty more to discuss beyond the competition alone.
The EMEA region is responsible for generating more than half of Airbnb’s global business, and its importance to the company’s growth isn’t lost on Merchiers. A longtime Airbnb executive who’s served as both a country manager for Spain and Portugal as well as a general manager, Merchiers assumed the role of Airbnb’s EMEA managing director when Booking poached Olivier Gremillon to be its new vice president of Booking Homes in October.
Skift recently interviewed Merchiers to ask him about his thoughts on the battle with Booking, as well as what he intends to do to continue growing Airbnb’s business in Europe, especially in markets with perceived saturation points.
What follows is an edited version of a recent Skift interview with Merchiers.
Skift: A lot of people are fascinated by the idea of Airbnb taking on the big online travel giants like Booking and Expedia. What, in your opinion, is fueling that, and what do you think of Airbnb’s odds for competing with those companies?
Jeroen Merchiers: This year, Airbnb is celebrating its 10-year anniversary and we have spent time reflecting on the past and how the company has evolved but more importantly we have been looking to the future. It has become plainly obvious over the last few years that people are looking for a different type of 21st-century travel experience, trips that go beyond the kind of mass-produced tourism that has been around for so long and instead giving travelers an opportunity to enjoy magical travel, with local people in local places. We made some big announcements for our 10-year anniversary and set a goal of reaching 1 billion travelers a year by 2028, and we will continue to help our communities create magical experiences for guests.
It’s also important to remember that there are some big differences between Airbnb and the other online travel agents (OTAs). Airbnb is growing faster and spending less because we have a community model as opposed to a commodity model. Hosts on Airbnb are part of a community and treated as partners, while some others treat hosts like commodities.
Our platform is unique and offers a different value proposition. While some big OTAs charge hosts fees of up to 30 percent, hosts on Airbnb keep up to 97 percent of what they charge for their listing. Airbnb handles important services like payments and can step in to provide additional support in the rare cases when something goes wrong. And unlike Airbnb, some other OTAs don’t handle payments, don’t collect and remit taxes and don’t offer the kind of support and recognition we provide to hosts.
Skift: How would you describe Airbnb’s evolution from homesharing to becoming an integrated, end-to-end travel platform? What does it mean and what does it entail for the future of travel?
Merchiers: When the founders started Airbnb 10 years ago with a few air mattresses in their apartment, they had no idea what the company would become. They simply found a creative accommodation solution at a time where there was no availability at nearby hotels. But they soon realized, as they hosted their first guests, that Airbnb can offer far more than just an air mattress on the floor. It could offer a much more personal and unique experience for guests provided by locals who know the area.
The travel industry is now 10 percent of the global economy and growing fast. As this industry grows, we recognize that we have an opportunity to help build sustainable, local and authentic travel experiences, and help ensure that as the number of people travelling increases, there are healthy travel experiences that benefit the economy, climate and community.
We also want to build a community that is for everyone. There have been over 300 million guest arrivals at Airbnb listings, but we want to do more to make it easier for everyone to find the home or experience that works for them.
For example, we will soon be making it easier for people to search for the exact type of listing they require by introducing four new property types including Vacation Home, Unique, B&Bs and Boutiques and we are also adding new Collections for family and work to offer inspirational content for different genres of travel.
For Trips, we recently added a further 7,000 experiences and in the last couple of months have launched in a further 15 cities. As we expand and enhance the platform to include all these new innovations, we will continue to work to achieve our mission — creating a world where anyone can belong anywhere.
Skift: Europe is home to many of Airbnb’s most mature markets, such as London, Paris, Amsterdam, and Berlin and to some, it may feel like these markets have reached their saturation points. So how do you intend to continue to grow Airbnb’s reach in these markets and throughout the region?
Merchiers: Airbnb has seen some of its greatest success in cities, with regular people sharing their homes with business travelers and tourists who are looking for somewhere unique and personal to stay. We have strong communities in many European cities and there is still potential for growth through home sharers but also through boutique hotels, bed-and-breakfasts, and small business owners offering different styles and types of accommodation to travelers.
We also want to grow outside the city centers. We have already helped diversify tourism away from these centers to areas that haven’t benefited from travel in the past and we want to build on our success.
Skift: The global conversation about Airbnb is inextricably tied to debates about the kind of impact the sharing economy is having on communities around the world. And more often than not, the pitfalls of that impact on local jurisdictions are often highlighted. What role do you see Airbnb playing going forward to ensure that the type of tourism that Airbnb facilitates is sustainable or healthy?
Merchiers: Governments around the world are already embracing Airbnb, and we have worked with communities to implement clear home sharing rules in cities across Europe including London, Amsterdam, Florence, and most recently, Berlin.
We have made clear we want to work closely with policymakers, with the development of our Community Compact and Policy Tool Chest, and globally we have proactively engaged with over 400 governments on different kinds of partnerships. Our goal has always been to ensure that hosting on Airbnb continues to benefit local families and communities, whilst growing responsibly and sustainably. In London and Amsterdam, we are the only player that has introduced an automated hosting limit making it easier for hosts to act in the best interests of everyone in the city.
Many cities have had historic housing concerns that existed long before Airbnb and we have seen how Airbnb can help people afford to live in the cities they love and long called home. Additionally, it’s important to examine our scale: Entire homes in London and Madrid for example count for less than 1 percent of all housing stock.
Of course, we understand that every city is different and as we move forward, we will continue to partner with individual cities to address their unique policy needs.
Skift: Ten years ago, it’s doubtful anyone would’ve thought Airbnb would be where it is today. What’s next for Airbnb over the next 10 years?
Merchiers: We are very excited about the future and we are not sitting still. In February, when we celebrated our 10-year anniversary, we made some major announcements including a total redesign of how people search and discover places to stay on Airbnb. We want hosts to stand out and for any traveler to find the right home or experience for their trip.
I’ve already mentioned new property types and we are working with hosts now to help them categorize their homes so that they can easily be filtered by travelers and supported by sophisticated search capabilities. Collections will start with family and work but will be extended to include many more genres from social stays to honeymoons and weddings. We want travelers to use Airbnb as a source of inspirational content for research. I’m really excited about the launch of Plus, a new tier of homes that have been personally verified for quality and comfort.
And also, Airbnb Experiences are continuing to do really well. Every week we are reviewing 1,200 new applications from people who want to host experiences on Airbnb.