Expedia's Vrbo isn't a global Airbnb killer, nor does it have to be. Vrbo will pick its spots, but that will be a disappointment to those hosts, frustrated and angry with Airbnb, who are looking for some company to take Airbnb down a peg.
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Online Travel This Week
I hear chatter from Airbnb hosts who are looking to Vrbo to mount a strong challenge to the $93 billion short-term rental giant. They ask when is Vrbo going to expand its Fast Start host recruitment program beyond the U.S., and into Europe and other geographies?
Why not strike when anger among a segment of Airbnb hosts, alienated by Airbnb’s pro-guest cancellation refund policy at the beginning of the pandemic, is still raw?
The Vrbo Fast Start program, which offers incentives for Airbnb super hosts to mostly co-list on Vrbo, officially debuted in the U.S. three months ago, but a European launch is weeks, if not months, away. Or perhaps Europe isn’t a major priority for Vrbo right now.
It’s clear that Expedia Group doesn’t plan to try and take on Airbnb head-on in cities, and numerous countries, but will stick with its whole-home sweet spot, build supply, and charge forward in destinations where it sees opportunity.
Speaking an an Evercore ISI conference earlier this month, Expedia Group CEO Peter Kern detailed how Vrbo didn’t overturn its strategy during the pandemic but took advantage of opportunities.
It’s probably a smart policy, but it will be a disappointment to many hosts who are hoping that Vrbo will become a major challenger to Airbnb across the board.
“I mean look, we haven’t changed what Vrbo is during Covid in the sense of we didn’t decide we’re going whole-hog into big cities and this was our moment or anything,” Kern said. “We pushed into where we already were, which happened to be an extremely strong use case during Covid.”
Kern said Vrbo achieved share gains against Airbnb, particularly in Vrbo’s largest market, the U.S., “leaned into the brand,” and saw “terrific wins.”
Expedia Group/Vrbo will be looking to add vacation rentals, filling shortfalls in locales where demand exceeds supply, such as in Florida beach towns this summer, he said.
“But overall, we think we’re going to stick with largely the whole home model and just try to push harder and win more markets, and at least give our main competitor a run for their money in most places where we can,” Kern said.
So Vrbo has ambitions and can be an Airbnb alternative for hosts in some markets, but don’t look for big things from Vrbo in major urban areas, for instance, which was Airbnb’s strength pre-pandemic.
It may be up to Booking.com to be Airbnb’s main global challenger in short-term rentals, but Booking.com hasn’t shown it has the wherewithal to date to be a serious challenger in vacation rentals.
For its part, Expedia Group, which includes brands ranging from Expedia.com to Hotels.com and Expedia for Business, has numerous areas it has to focus on besides Vrbo and short-term rentals.
So while Airbnb at the beginning of the pandemic dialed back its online travel agency ambitions in flights and, to a certain extent hotels, to focus on short-term rentals and experiences, Vrbo parent Expedia Group has much broader interests.
Consider this: Vrbo doesn’t even have a full-time leader: Vrbo President Jeff Hurst splits his time as chief operating officer of Expedia brands.
The lack of focus will undoubtedly be an issue in Vrbo’s growth trajectory.
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