Airbnb bounces back, is bullish on Asian growth

More nights booked, more cross-border travel, more hosts, longer stays: Airbnb is emerging optimistically from the pandemic period and eyeing up Asia as a major growth area.

Key stats

• Nights and experiences booked increased 20% in Q4 2022 compared to a year ago.
• Cross-border gross nights booked in Q4 2022 increased 49% year on year, while high-density urban nights booked grew 22%.
• Gross nights booked in Q4 2022 for more than a week were 40% higher than Q4 2019.
• 900,000 more listings were added during 2022, bringing the global total to 6.6 million (excl China). 

Why it matters

Airbnb made a strategic marketing change a few years ago when it discovered site traffic levels remained high even though it had slashed spending at the start of the pandemic. 

The subsequent pivot to PR to build brand awareness has evidently proved successful and effective. “There were 600,000 articles written about Airbnb last year,” CEO Brian Chesky told a Q4 earnings call. “Airbnb is on social media a lot and a lot of people are talking about Airbnb on social media.”

Evolving marketing 

• Marketing costs as a percentage of revenue aren’t expected to change in 2023, but the timing of marketing efforts will shift to earlier in the year. 
• Marketing efforts are focused on attracting new hosts; the top source of new hosts is prior guests: in Q4, 36% of hosts were prior guests. (There’s also a word-of-mouth element as people get more bookings and tell their friends about it.)
• Taken together, these initiatives have doubled the amount of traffic to Airbnb’s landing page to learn about hosting. 

Future Airbnb

• APAC accounted for just 12% of the business in Q4 but is seen as “a huge growth area” for the future: there’s a lot of pent-up demand and a large number of Gen Z travellers – a demographic more likely to use Airbnb.
• A rebound in Chinese outbound travel is also expected to benefit Airbnb around the world. 
• With so many properties, Airbnb sees AI as potentially helping it better match consumers to available properties.

Key quote

“We just take a full funnel approach to marketing around PR, and we think of our general advertising as really educating people on new products” – Brian Chesky, CEO of Airbnb and Airbnb host.

Sourced from Airbnb, Seeking Alpha

[Image: Airbnb]