Airbnb should be a household name by now but it is often mistaken as a threat to the hotel industry. It isn't.
One thing that the luxury hotel can offer is security. Airbnb is the direct opposite and doesn't appeal to the rich and famous as safety is of their paramount concern.
The upscale hotels serve the business travelers who utilize their company's membership deals with Marriott, Hilton and such. They are unlikely to go for Airbnb stays.
Even the mid-tier hotels are likely to keep their travel agency customers as they usually book many rooms at once. Airbnb can't really offer this.
Hence, the Airbnb are for those who seek adventure - living like a local and experiencing unique properties.
It was a blue ocean strategy - Airbnb is in the hospitality sector but does not compete directly with the hotels - it created new demand.
Before Airbnb, there were backpacker inns. But those who were not so budget-conscious didn't have other options and have to go with the hotels. Airbnb created that adventure option and the rest is history.
Recently, there were new use cases - long-term stays and non-urban travel. After the pandemic, work spaces became more flexible. Not everyone is returning to the office and that the work-from-home culture has evolved.
Some chose to work in different places at different times of the year. They book a property on Airbnb for months instead of days and they just live and work there.
The loss of tenants in the US office space has been a gain for Airbnb. Who would have thought that Airbnb could compete in office real estate?!
Airbnb keeps surprising us with new demand.
It is easy to belittle Airbnb's market size and as the use cases seem frivolous. They are not.
