Airbnb, Vrbo go big – sometimes boring lengths – to woo hosts

(Bloomberg) – The phone at the Buckhorn Inn in Gatlinburg, Tennessee, has been ringing since early summer. Owner Lee Mellor is trying to avoid answering them as her 10 rooms, seven cottages and three guesthouses at the foot of the Smoky Mountains have been nearly full since April.

But that didn’t stop Airbnb Inc., Expedia Group Inc.’s Vrbo, and other online travel agents from trying to entice her to advertise the 30-acre property – with its stunning views of the mountains, pet swans and private hiking trails – on their sites.

Companies have doubled the number of calls to Mellor in the past year, but she has no interest in using the sites to book guests. The hostel has been primarily word of mouth for decades and Mellor sees no reason to change.

After a dead summer last year when the coronavirus still had many places on lockdown, travel agencies and travelers are making up for lost time. For many, the ideal travel now is domestic and rural, often within driving distance of home, and accommodation in a private residence. Almost 30 cents of every dollar spent in hospitality today goes towards short-term rentals, according to analysis of data compiled by AirDNA and STR Inc. They were the part of the growing online travel industry fastest even before Covid-19, and more in the past 18 months, they have largely kept the industry afloat.

Demand for short-term rentals has increased by more than 60% from a year ago and even more from pre-pandemic levels, said David Phillips, president of hotel tech startup Jurny. This explosive demand means that “booking platforms are feeling more pressure than ever to increase registrations,” he said. Otherwise, they could miss out on one of the busiest summers ever and the potential for even more business throughout the year as people take advantage of the flexibility of remote working.

For guests in Sevier County, Tennessee, home to Dollywood Theme Park and the Great Smoky Mountains National Park, the heightened rivalry is annoying. Brad Ivens, owner of cabin management company Eagles Ridge Resort, says he’s received more calls and emails from more online travel agencies than ever before . Even when he tries to relax in front of the television, he cannot escape. “Looks like all the other ads are for Airbnb and Vrbo,” he said. Vern Hippensteal has trained his staff at Hippensteal’s Mountain View Inn to tell them he’s not there when travel agency representatives call. “Every day I delete emails – just delete them – I don’t even open them,” he says.

Awareness campaigns are not just linked to the post-pandemic outbreak and a limited number of available housing. They also stem from what Airbnb rivals see as a rare moment of weakness for the travel titan. Airbnb has dominated the short-term rental market since it revolutionized travel 13 years ago by encouraging people to open their homes to strangers. Today, the San Francisco-based company has approximately 5.6 million listings worldwide.

Airbnb has always been proud of its relationship with the hosts who list their homes on its platform. Yet, at the start of the pandemic, the company alienated many by rolling out a full refund policy – a move that appeased guests who were suddenly banned from travel, but cost some hosts tens of thousands of dollars. . Then, after Airbnb laid off a quarter of its workforce in May, including many of its customer service reps, hosts were sometimes left on hold for hours while waiting to speak to someone from within. company.Expedia and Booking Holdings Inc. saw an opportunity and jumped on it. Ivan Feinseth, who covers online travel agents for Tigress Financial Partners, says the competition is “absolutely more aggressive now” than it has ever been. In interviews with dozens of Sevier County hosts, many seem agnostic about where they list their property. Their strategies range from word of mouth to picking a favorite or signing up on as many platforms as possible. But some have been converted. Syresa and Lonnie Rowland started operating their historic farmhouse as bed and breakfasts on Airbnb a few years ago. During the pandemic, they decided to list the property on Vrbo because they were frustrated with Airbnb’s Covid-19 cancellation policies. They say it was impossible to have someone from Airbnb on the phone, but Vrbo called them directly to advise them on cleaning policies and safety features, like putting deadbolts on the doors of the rooms. bedrooms. At their historic Seaton Springs farm, every booking came from Airbnb. Today, 50% come from Vrbo. In a recent ad, Vrbo directly targets Airbnb hosts, telling them that if they sign up with Vrbo, they will attract families “who spend more than twice as much” on accommodation. (Some analysts dispute this.) Vrbo, which has around 2 million ads, has doubled the amount of money it spends on host acquisition efforts and launched its most expensive brand campaign of all. time.

“Our competitor is always in the news and always loud,” Jeff Hurst, COO of Expedia Brands, said of Airbnb. “We wanted to be sure that at a time when they weren’t acting on behalf of their partners, we were loud,” he said.

Vrbo and Booking have rolled out programs to help hosts copy their listing information to the Airbnb site, including their property description, amenities, and photos, and upload them to their platforms in less than $ 15. minutes. Every day, Eric Bergaglia, House and Apartment Manager at Booking.com, makes calls from his Amsterdam office to court hosts in the United States with financial incentives, like commission-free bookings for new users.

Earlier this year, Booking, which has 6.5 million listings, mostly in Europe, launched a pilot program offering its largest discounts ever to hosts in select U.S. states. “We’ve gone further into the southeastern states where we know most of the demand is going,” Bergaglia said. Responding to increased competition, Airbnb unveiled its biggest platform upgrade in May, including more than 100 new product features. Customers were offered more flexibility in their reservations and the host onboarding process time was sped up to just 10 minutes. The company also doubled the number of support agents available and created a new role: Global Hosting Manager, to strengthen its relationship with web hosts.

Since taking office, Catherine Powell says she has listened to more than 4,000 hosts to try to determine how the company can best help them. “We know that last summer, when the trip unexpectedly returned, we weren’t ready,” Powell said. Since then, the company has made many improvements. “We are incredibly grateful to our hosts who stay with us. “

Airbnb is also devoting more resources to host recruitment efforts, Powell said. New hosts with a single list who have joined since the pandemic was declared have earned $ 1.2 billion globally, she says. Managing Director Brian Chesky said the company needs millions more hosts to cope with a travel rebound that he says will be “unlike anything we’ve seen before.”

Sevier County has certainly experienced this. A day’s drive from two-thirds of America’s population east of the Mississippi River, the county was the fastest growing of the top 50 short-term rental markets in the United States in April, according to AirDNA data. The area’s vacation rental managers are pretty much full until October and say they haven’t seen it like this since the 1990s.

Shirley Price, owner of Foxtrot Bed and Breakfast in Gatlinburg, says she has seen more people in the first four months of this year “than I have ever seen in 16 years of operation.” Jimbo Whaley, general manager of Hearthside Cabin Rentals in Pigeon Forge, said the flood struck when the national park reopened last May. “It was like it was on steroids,” Whaley said.

© 2021 Bloomberg LP


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