The endless round of hotels vs Airbnb continued this week, with consumer group Which? reporting that a hotel room may very well come in cheaper than a one-bedroom flat on Airbnb. In fact, their study proved just that, with a one-night stay in a hotel at an average of £101, compared with £120 across Airbnb and Vrbo.
Rory Boland, editor of magazine Which? Travel, said: “Many holidaymakers may be surprised to discover that the average cost of hotels in many destinations is cheaper than one-bedroom holiday lets, which are often promoted as a popular option for travellers trying to save money.
“When planning your next trip, don’t assume a hotel will cost more, but instead check rates across different platforms.
“For larger groups that need more rooms and space, private rentals are still likely to beat hotels on price.”
As ever, it’s a good thing one of the best things about holidays is the planning, or we’d have given up millennia ago, pulled down under the weight of relentless cross checking, checking, reputation checking and then checking again for last-minute deals.
At Airbnb, the platform has known that its prices were creeping up for some time, because, well, they were earning more money. This wasn’t a great issue for the group’s marketing arm, because it claimed to be all about local stays for local people and whatnot. It’s more of an issue in reality, because Airbnb had a reputation for being a cheaper option (unless you were travelling with a group of friends or family, in which case it remained the only option so bad luck).
Co-founder & CEO Brian Chesky is seeking to reclaim the group’s position as a value option, telling the most-recent earnings call that the group had initiated a number of new strategies. These included letting hosts see local rivals, allowing them to set prices accordingly, reducing fees for stays longer than three months and making it easier to offer discounts.
He added that a further step to address affordability was “the launch of Airbnb rooms. Airbnb rooms takes us back to our founding ethos of sharing, and it’s one of the most affordable ways to travel. Airbnb rooms have an average price of only $67 per night, significantly lower than the average hotel room. Given the increased price sensitivity for many guests, especially the next generation of travellers, this is going to remain an important category for Airbnb”.
Doing this without the help of Chesky was New York, where restrictions the platform has been resisting with full force for some years have now come in, making it not longer possible to rent an entire apartment. Or one without the host also living there. Bargains may now flourish again.
The platform is eager not to lose out on cash. Chesky said that while some prices would come down, other would go up, plus he was planning margin expansion “by launching incremental services for guests and hosts over the coming years”.
He concluded: “If we can keep prices very affordable, and then also focus on reliability, I think there’s going to be a lot of demand to come.” Reliability is a question for another time, but is unlikely to come without cost.
One area which might help on both fronts is AI. Earlier this month Airbnb announced that James Manyika, Google’s SVP of research, was joining the board, where he will chair the stakeholder committee.
Chesky said: “It’s inevitable that AI will reshape society and have a profound impact on our business. With James joining our board, we’ll continue to benefit from his guidance as we embark on the dawn of this new technological revolution.”
As people who play with words we love the casual fling-out of “it’s inevitable”. What is inevitable is Some Change and you don’t have to be a student of Heraclitus to know that.
But while Chesky is no doubt hoping it’s going to mean he can at the very least check whether a listing which offers wifi actually has it without sending someone ‘round at great cost, what about the consumer? That poor fool checking prices around the clock? It would be fun for travel planning to be more ‘where am I going to get the best tiny fried fishes watching the sunset’ and less trying to game algorithms with your GCSE maths. Maybe there’s a place for that too.