Latin America : Online travel agency Despegar is looking to compete with Airbnb, Vrbo and Booking.com by rapidly adding vacation rentals in Brazil and Mexico.
In its latest second quarter earnings report released last week, it was revealed that Despegar saw a 42% year-over-year increase in direct sign-ups on its platform, which stands at now at 20,000.
Despegar has increased its offering of rental properties – ranging from apartments to houses, cabins, condominiums, country homes, campsites and houseboats – to nearly 420,000 worldwide, including 68,000 in Latin America. In Brazil, the most popular destinations are Rio de Janeiro and São Paulo, while Buenos Aires, Bariloche, Córdoba, Ushuaia and Iguazú are experiencing the greatest increase in demand in Argentina.
The company expanded its vacation rental offering in seven markets in Brazil and Mexico in the second quarter, following the acquisition of a 51% majority stake in Brazilian channel manager Stays.net in March and fellow OTA ViajaNet for $15 millionwhich was announced in May.
Despegar said that, while citing a number of private sector studies, the online vacation rental market is expected to grow by 40% through 2024, compared to 2019 figures, and account for 17% of all accommodation rentals.
The growth of the market has been fueled largely, according to the company, by the deployment of hybrid work models by more companies in the region and globally, with many companies no longer requiring their employees to work in a full-time office.
In its latest earnings report, Despegar announced a promising quarter, in which its gross bookings [$1.1 billion] were up 129% from the same period a year ago and were in line with pre-pandemic levels three years ago.
Revenue increased 113% to $134.4 million from the second quarter of 2021, while transactions increased 65% year-over-year to 2.2 million.
Meanwhile, Despegar achieved a positive third quarter of adjusted EBITDA, hitting $10.6 million after posting a loss of $22.3 million 12 months prior.
International bookings remain well below 2019 levels, with domestic bookings remaining flat in the quarter.
Despegar CEO Damián Scokin said, “Our winning business model and expanding travel ecosystem allow us to continue to effectively capture growing travel demand, particularly in Brazil, our largest market.
Ivan Marenco, Vice President of Vacation Rentals at Despegar, will be participating in a ShortTermRentalz RockSTRz webinar on Tuesday, November 8, titled “Analyzing the Hottest Growth Markets in Vacation Rental”. Register for the free session on this link to learn more about Despegar’s vacation rental strategy.
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