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  • Kate Reddin

AirBnB vs. The Hospitality Industry: A Trend Toward the Personal

The most recent valuation of AirBnB is over $13 billion, putting it in league with the world’s largest hotel chains. If current rates of growth continue, the peer-to-peer network will soon be worth more than Hilton Worldwide Holdings, which is currently valued at nearly $20 billion.

What does this prove? First, that AirBnB can no longer be described as a thorn in the side of the hospitality industry. And second, while AirBnB can never completely replace the traditional hospitality market, it can certainly show it how to evolve.

In the early years (2008-2012), AirBnB was commonly seen as a passing trend or offbeat experiment. Now that it has proven to be nothing of the sort, some hope that local governments will put increased pressure on AirBnB hosts. After all, there are cases of neighbours being unhappy with transient visitors, and questions of tax evasion on the part of hosts.

These issues will settle out on a city-by-city basis—and the reality is, AirBnB’s potential problems look like peanuts compared to its growth.

As a result, many people in the hospitality industry are beginning to face the music and ask questions that matter. Why is this idea so successful? What do people love about it, and how can traditional properties cater to the same values?

In other words, what can AirBnB teach us about the future of hospitality? The lessons are many, but delivering personality and a definite sense of place are perhaps the most important.

A Trend Toward the Personal

Part of AirBnB’s appeal is the power it gives potential guests. Not just the power of choice, but the power of locale, of character, of personality. Search any city’s listings on AirBnB, and you’re guaranteed to see a recurring sales pitch amongst hosts: Experience the real New York, the real Paris, the real Melbourne—and do it for less!

The implication is that traditional properties do not represent an authentic experience of the area, the city, the locale. AirBnB can effectively make this claim because it gives travelers access to residential neighbourhoods where hotels simply don’t exist. Moreover, a hotel brand (especially a global one) can seem quite stuffy next to a loft apartment decorated with local art. AirBnB gives you options that aren’t just corporate logos and standard fittings—it gives you people. Each host on AirBnB is his or her own brand, and the transaction between guest and host is an eminently personal one.

Hotels and short-stay apartments can’t claim to be individuals renting out their flats, but they can get better at delivering a sense of place. They can re-think key aspects of design, branding and service in order to shrink the conceptual gap between local and global, trendy and boring, involved and sequestered.

And traditional properties can certainly be more personal. Part of the fun of AirBnB is meeting new people and making new connections. Guests remember the hosts they encounter, the conversations they share—but how often do they remember hotel staff? This is partly because staff are trained to be professionally friendly, whereas the role of AirBnB host is somewhat casual by nature.

The important thing is to question the long-standing wisdom. Do guests prefer hotel staff to be friendly in a highly guarded manner, or would a more personal approach be effective? What would compel the guest to remember people, faces and names instead of just a logo or points balance?

These are all valid questions, and properties that come up with creative answers will almost certainly create advantages over those that say it’s business as usual.

This is part one in two-part series on how AirBnB is changing the hospitality industry. Part two focuses on the importance of user interface, increased transparency, and user-generated quality control measures.

For further industry insight, please follow the links below.


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