The sharing economy is growing faster than ever. While ridesharing company Uber continues to take bites out of the taxi and rental car market, Airbnb is emerging as a new favorite for business travelers.
According to a Certify infographic, for the first time, more business travelers are choosing Uber over taxis. This trend extends to the sharing economy rental marketing. Airbnb experienced a 143% growth from Q1 to Q2 2015. Business travelers tend to stay longer with Airbnb versus hotels, at an average of 3.8 nights with Airbnb versus 2.1 nights in hotels. Users also love Airbnb. On average, Airbnb users rate their stays higher than those who use hotels, with a 4.72 average rating for Airbnb versus 4.04 for hotels. And, Airbnb guests tend to spend more. Cost per expense with Airbnb is higher on average when compared to all hotels.
Airbnb is getting serious about going after corporate customers. Following a year-long trial in the US, it recently announced a worldwide expansion for its Business Travel Program.
However, given Airbnb’s rather non-traditional reputation, will its new venture hold global appeal? New data from GWI’s Q2 2015 research suggests it could.
Leisure travel is still key to Airbnb; three quarters of its users are vacationing abroad at least once a year, while over a quarter are taking leisure breaks at least once every three months.
Significantly, though, some 58% of Airbnb users are taking business trips at least annually, with over 1 in 4 doing this at least once a quarter. That’s a pretty substantial potential user base for its Business Travel program, then.
Another shocking statistic: According to a recent study out of Boston University, Airbnb is taking bites out of the hotel industry. A 10% increase in Airbnb supply results in a 0.35% decrease in hotel room revenue, which translates into a 13% impact on revenue in Austin, Texas, which is home to the highest Airbnb supply.
To respond to the Airbnb threat, hotels need to provide guests with an experience that Airbnb can’t deliver. They need to get to know their guests, so they can build one-to-one relationships and deliver personalized experiences.