EP118: The World of Airbnb – Week 2

EP118: The World of Airbnb – Week 2

With the astonishing growth of Airbnb there is almost a constant supply of news and updates to discuss. That’s why every Thursday, Jasper and a guest host will discuss the recent Airbnb news and the ways this will impact you as a host.

This week jasper talks with Hostfully Co-Founder David Jacoby! David and Jasper talk about Airbnb CEO Brian Chesky’s latest tweets and some of the most requested Airbnb improvements for 2017.

Jasper and David then discuss 3 recent Airbnb news articles. Each article is linked in the show notes!

Some of the topics covered

Brian Chesky twitter question: If @Airbnb could launch anything in 2017, what would it be?

  • 1000’s of replies
  • Popular answers included: Bitcoin payment, Guest loyalty program, Group payment options

Airbnb’s recent investment in Resy

Airbnb experiences expansion

Airbnb host tools additions and improvements

Article #1:

The big reason why Airbnb terrifies the hotel industry

Article #2:

Hotel and Airbnb Prices for Trump Inauguration See Big Jumps and Some Deals

Article #3:

Airbnb Dives Into Live 360 Video on Twitter, Periscope

Connect with David Jacoby

Twitter: https://twitter.com/davidjacoby

Resources mentioned

Brian Chesky twitter: https://twitter.com/bchesky

Connect with Jasper

Email: [email protected]

Twitter: @GetPaidForUrPad

Instagram: @GetPaidForYourPad 

Facebook: www.facebook.com/getpaidforyourpad

This episode is sponsored by Hostfully.com where you can create a custom digital guidebook for your guests!

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Complete Transcript for Get Paid for Your Pad Episode 118

Jasper:

Welcome to Get Paid For Your Pad, the definitive show on Airbnb hosting, featuring the best advice on how to maximize profits from your Airbnb listing, as well as real-life experiences from Airbnb hosts all over the world. Welcome.

 

Jasper:

This episode is brought to you by Hostfully, a company that helps you make beautiful guidebooks for your listing. Make your own at hostfully.com/pad, and a special for Get Paid For Your Pad listeners, you’ll get a free guidebook consultation after you make your guidebook.

Welcome, everybody, to a very special episode of Get Paid For Your Pad, because we’re going to do something new. From now on, every Thursday, we’re going to have an episode in which I discuss the news around Airbnb that came out, and I will always have a guest, and a lot of the times it will be David, the co-founder of Hostfully.

David, how’s it going?

David:

Hey, Jasper. It’s going pretty well. Thanks for having me. I’m looking forward to doing this with you.

Jasper:

Yeah, I’m excited, too. I’m really excited. This is fun. We figured, you know, everybody wants to know what’s going on with Airbnb, and instead of setting up Google alerts or scrolling through all these different articles on the Internet, you can now just listen to this episode and we’ll keep you up-to-date. We’ll do our best to pick the most interesting news stories that came out during the week, and we’ll share and discuss, and we’ll see how it goes. This is new for us, as well, but I think we’ve got some really interesting topics to talk about.

And I think the first thing we’ll start with is that Brian Chesky, the CEO of Airbnb, he asked a question on Twitter, and he asked, “If Airbnb could launch anything in 2017, what would it be?” Now, he got a lot of replies. There was a very active Twitter party going on. There was over 1,400 replies, the tweet has 555 retweets, so a lot of people got engaged and he got a lot of ideas. Do you know how many, David?

David:

Oh, he got tons, and it was some great press for him beyond the Airbnb world, but everyone in the business world is talking about how it’s a great way for a high-level CEO to stay connected with all his users.

Jasper:

Right, because he stayed on the platform, on Twitter, for hours, and he was really talking one-on-one to lots of people. He was responding to all the different suggestions. He was joking around with people. It seemed like a pretty fun thing.

David:

Lots of great ideas were presented, and we got a nice little glimpse into what’s in store for 2017 and beyond. It seemed like one of the most popular ones is a loyalty program request. So, people who stay at more traditional hotels, you know, after a certain amount of nights, they get a free night, and that’s not the case with Airbnb, so he acknowledged that was a popular request, and we’ll see if they’re going to add some loyalty program this year.

Jasper:

That would be pretty sweet. That’s a very good addition, and yeah, I’ve heard people request this before. What are some of the other main ones that you saw?

David:

Well, some outside-of-the-box ones. Some people were suggesting payment by Bitcoin, and I know of some other companies where it’s pretty easy to do. They set up the Bitcoin payment, and then they immediately have it converted to cash through another service, so they always have cash. They’re not really dealing with Bitcoin. So, it could be easy to implement and could get a lot more users on board.

Some other cool ideas, some improvements for search, some group travel updates, like splitting the cost amongst guests. So, Jasper, if you and I were going to have an adventure somewhere, make it easy to pay. That’s something that Uber has done, for example, with getting lifts there, you can split it with people, you’re sharing rides. So, they seem pretty interested in that.

Jasper:

Yeah, I think that’s a really good addition, because I actually have guests sometimes that have problems with the payment. Like, somebody wants to pay for the whole group, but the amount is too high, especially people from lower income countries. And so, I get those questions sometimes, where people say, “Hey, can I split up the payment or something,” and I don’t think that’s possible right now.

David:

Right, right. Another thing that was interesting, I thought, was having a validated Internet speed test that would be listed on the site. I guess lots of people have had trouble with their Wi-Fi access staying at an Airbnb. And what I’ve seen some users do is actually do their own speed test, and then take a screenshot of that and put that in the photo section of their listing so they can validate, “Hey, this is what the Wi-Fi speed is.” But, if Airbnb did something themselves, where if they validated it, that would be a cool feature for them to add.

Jasper:

Yeah, definitely. I’m actually one of those people who put a screenshot of their Internet speed in their pictures. I don’t know if you got the idea from me, but… But, in fact, I do always ask the Airbnb host before I make a booking. That’s one question that I always ask them, “How fast is your Internet?” And, sometimes, if I’m not convinced, I even ask them to put up a picture in their Airbnb listing because the Internet speed is so important to me.

David:

Mm-hm, yes.

Jasper:

So, I totally get that one. Also, I see that some of the most popular questions were about Experiences, which is kind of confusing because they’ve already launched that.

David:

Yeah, I think there’s a lot of questions about it, though, because they just launched with something like 10 or 12 cities and not a ton of Experiences, so everyone’s excited to see what’s in store for that. Of course, they’re expanding to 50 cities, they said, by the end of this year, and it seemed like peer-to-peer dining as part of the Experiences was a popular request, and they want to try to formalize that, you know, have it so one person can cook dinner or have a dinner party for 10, and everyone pays $40 or whatever, and then you have this real in-home intimate dining experience versus going out at a restaurant.

Jasper:

Yeah, that sounds really good. There’s already a few platforms that do that, right? I think one’s called EatWith.

David:

Yes, and at the Airbnb Open a couple years ago, they had partnered with one of those, too, so we all could eat in different people’s homes. So, I don’t know if they’re going to continue that partnership, or if they’re just going to try to make it in-house, a feature that they create themselves.

On a related note, they did talk about, at this year’s Airbnb Open there, an integration with Resy, which is a sort of competitor to OpenTable, to do local restaurant reservations, so I think they’re going to expand on that in a number of places. And, I actually just read they became an investor in Resy, so they’re branching out and not just doing something themselves, but investing in other travel companies that are related to their focus.

Jasper:

Right. Have you created any Experiences yet in San Francisco?

David:

I have not, no, and I don’t think individual hosts can just sign up and create and offer an Experience right now. I think it’s being highly curated. So, Airbnb themselves are seeking out unique situations, whether it’s some guy who’s doing a special tour or an artist who’s making something in their gallery, but it’s not like Airbnb, where anyone can just add a room. You can’t just suddenly offer a tour yourself. Airbnb is highly curating it right now.

Jasper:

Interesting, because I actually do see, and I think this might differ for different cities, but on my Airbnb listing, and I’m looking at it right now, there is a tab called ‘Experience Hosting’, where I can create an Experience, apparently. I haven’t done it yet, so I don’t know what happens. Maybe you can create it and then they’ll contact you or something, and they’ll go through the Experience and see if it’s suitable. I don’t know, but there’s definitely a button on my Airbnb listing here in Amsterdam.

David:

Well, go for it. Let’s see what happens.

Jasper:

Yeah, exactly. There’s only one way to find out.

David:

Yeah, that in-destination Experience, though, seems to be a big focus for this year with the Experiences in general, whether it’s a tour that’s just a few hours, or a tour that lasts multiple days, or the peer-to-peer dining experience. They also seem to have a focus on putting some meet-ups in where they connect travelers that are in the same area, having them be all able to get together and hang out.

One quote of his, too, was, “Machine learning to build a better virtual assistant.” So, it seems like they’re working on creating a virtual concierge of sorts that will make targeted recommendations to the guests.

Jasper:

That sounds very cool. I see “Airbnb-designed hotels”. That’s an interesting one. And then, somebody wants to have an Airbnb on Mars, and Brian Chesky’s response to that was, “Working on it, not joking.” So, that would be cool. Well, it’s cool if you can stay at an Airbnb on Mars, but the question is, how do you get there? I mean, Airbnb, also, is planning to get into the travel space, right, I mean, the flights.

David:

Yeah, exactly, so maybe Airbnb will offer a flight to Mars, and then an accommodation on Mars, as well. Yeah, they’re really kind of shooting for the stars, (no pun intended), with some of their expansions that they announced at the Airbnb Open, and flights being one of them, and rental cars being another. Who knows what exactly that’s going to look like. Are they actually going to have their own airline? Are they going to partner with another airline?

It seemed like in the Twitter verse, in the conversations, he almost made an unnecessary dig, in my opinion, at some of the longer-standing travel companies, like Amadeus and Galileo. He said, “The reason tools are so bad is they have to connect to a 1970s GDS software system.” (‘GDS’ is Global Distribution System.) And these are big companies that kind of power the likes of Expedia and Kayak, and they’re very tech savvy, and it seems like he’s almost going to battle with them right away. So, we’ll see how flights and rental cars take shape, and if he can walk the walk.

Jasper:

Yeah. It would be nice, though, so you can basically just book everything on the Airbnb platform, you don’t have to go anywhere else.

David:

Yes, hence their hopes of being a lifestyle brand.

Jasper:

Anything else that you saw that you think is worth mentioning?

David:

Maybe, finally, some host tools. We haven’t really talked about that, but there are some improvements for a host. One thing, he commented, was a landlord integration tool. I’m not exactly sure what that means, but for those hosts where there’s a landlord family operation, having some more integration and communication with the landlord.

He mentioned improvements to dynamic pricing, which is always a hot area to talk about. And, also, a host supply store, which could be interesting. I’d love for there to be an Airbnb store where, as a host, there’s products that I can buy that would help my guests out.

Jasper:

Yeah, absolutely. And I wonder if you can get those products for free, because I’m sure that… Isn’t there this thing called ‘product placement’, you know, where companies, like big brands, they want their products to be placed in places that see a lot of traffic, especially if it’s the type of traffic that will be interested in their brand?

David:

Absolutely. That’s a very clever idea. I know that Tuft & Needle, the mattress company, they had done a free giveaway of their mattresses to some hosts last year because they wanted guests… In theory, the host would be promoting that mattress to the guests, and now all the guests are trying out a Tuft & Needle mattress. So, I think there’s a lot of opportunity for that.

Jasper:

Yeah, yeah. I think that’s not a bad idea because, you know, if you have a full-time Airbnb, you might have up to, maybe, let’s say, like 50 bookings a year, or maybe even 60, 70 bookings, and let’s say you have four people, that’s like 200, 250 people who try out your mattress. That’s quite a lot of people.

David:

Exactly, yeah.

Jasper:

And then, also, it’s very highly… You know, if you give the host a free product and the host enjoys using that product, then he’s really going to recommend it to the guests, as well, right? So, there’s a little value there.

David:

Exactly. Whether it’s sheets, or a mattress, or coffee, or umbrellas, (here, it’s raining hard in San Francisco now), they can really run the gamut of what they can be offering to tourists who need something while they’re on vacation.

Jasper:

I see an interesting suggestion here – “Full Boss Experience: book home, black car pickup, private chef, in-home massage, private trainer, in one swipe”.

David:

Nice. That sounds fun.

Jasper:

Awesome. And I see someone talking about car rentals, as well. If you can rent your car through Airbnb, that would be useful.

David:

Lots of interesting ideas.

Jasper:

Hosts, I can’t emphasize how important it is to share recommendations of things to do or eat near your listing beforehand. Your guests won’t have to go through TripAdvisor, Foursquare, or Yelp. They won’t have to scratch their head and think about possible places right in the moment. I’ve been using Hostfully to create an online and printable guidebook to show my guests my favorite coffee places in Amsterdam. They use my recommendations, and I’m getting fewer questions from my guests as a result. I’ve also included screenshots of my guidebook on my Airbnb listing as a way to differentiate my listing from others. So, make your own guidebook at hostfully.com/pad.

Awesome. Well, let’s move on to the next topic for today, which is, let’s talk about an article that came out on Yahoo Finance. It’s called “The big reason why Airbnb terrifies the hotel industry”. Well, first of all, do you think that the hotel industry is worried about Airbnb?

David:

Sure. Lots of hotels say they aren’t, but of course they are. They keep creeping into their space and they have more accommodations now, by far, than any other hotel. So, they’re here to stay and playing in that hotel space, and of course, they’re a major player now.

Jasper:

Right. I agree. And this article came out just a few days ago, which is interesting because it shows lots of graphs and lots of numbers, which is always interesting, and it compares the number of listings to all the big hotel chains. So, Airbnb has 3,150,000 listings right now, and are those all active listings? I don’t know if they count all the listings that aren’t really active in that number, but at least, over 3 million, that’s a lot of listings, and it’s been growing very quickly over the last few years.

David:

Yeah, there’s always questions about how that data gets scraped, and might count what people call zombie listings, listings that were put up for, like, the Super Bowl here in San Francisco last year, and then never taken down, so it’s not a real listing but it’s still on the website. So, not exactly sure where that number comes from, but no matter where, it still is a lot and three times the amount of the Marriott. You know, even if some of them are bogus listings, it’s still clearly the leader.

Jasper:

Yeah, it’s three times the Marriott, and I guess Marriott is the biggest hotel company in the world. Well, I guess Airbnb now is. Well, they’re not really a hotel. But, it says Hilton has 800,000. That’s a lot, though, 800,000 rooms in Hilton hotels around the world. Wow, there must be a lot of Hilton hotels. IHG’s up there, Wyndham, Choice, Hyatt, but those are all much smaller. So, yeah, I guess that is something to be worried about.

The next graph shows a survey on where people would be staying if they wouldn’t be staying in an Airbnb. So, they’ve asked people, “If Airbnb didn’t exist, where would you stay?” and then 43% answered ‘midscale hotels’, so I guess that’s sort of the niche within the hotel industry that should be most worried about the Airbnb concept.

David:

Yes, right now at least, because oftentimes you can find a more affordable accommodation on Airbnb, so people who would stay at a midscale hotel would choose Airbnb instead. And a lot of the upscale hotels say, “Oh, we’re not worried about Airbnb at all,” but still, I think those numbers are going to change, as well, as Beyoncé and Mariah Carey, and all these celebrities post “Thank you, Airbnb” after they stayed in a $20 million home that was on Airbnb. There’s a lot more upscale accommodations that are appearing there, as well.

Jasper:

That’s true, yeah. That’s absolutely true, because right now, it’s only 4% of Airbnb guests that say that they would stay at the upscale hotel, but that can change.

David:

One other thing I found interesting with that, in this report, it said that one-third of the listings are private rooms, and find that the other two-thirds are complete homes. And Airbnb’s original model, from the roots of Brian Chesky and Joe Gebbia’s first Airbnb listing, was that it was an extra room in their home, and they really pivoted to the HomeAway, VRBO model and they’ve gotten a lot more listings that are just complete private units. And not a lot of people realize that, I think, and here it says the majority of their listings are actually private accommodations.

Jasper:

Right. Okay, because I always, actually, I always thought that there was more private rooms than entire apartments.

David:

That’s not what this report says. This report says one-third are private rooms and the rest are whole apartments or homes.

Jasper:

That is interesting. That is interesting. So, right now, Airbnb’s valued at $30 billion, it says, which makes it the second highest valued start-up after Uber. That’s a lot, $30 billion. And here’s another question for you. There’s always been this talk about Airbnb going for the IPO. What are your thoughts on that?

David:

Oh, well, clearly they’re positioning themselves for that. I know they hired a CFO, I think last year, who has experience in that area to get them ready for that, but I think a bunch of regulatory issues need to play out first. So, hopefully, things are settled here and taken care of in San Francisco for a while. We’ll see what happens in New York. But, all around the world, I think over this year, they’ll see how those regulations take place. And, also, they just launched Experiences, so we’ll see how that goes, and then once things are a little more steady, I think they’ll be in better shape for an IPO.

Jasper:

Another interesting fact in this report is that they say 17% of Airbnb listings are available 360-plus days per year, 60% over 270, and 78% over 180 days. And that’s interesting because a lot of cities have adopted regulation around Airbnb where you can only rent out for 60 days, or 90 days, or 120 days. So, it’s interesting to see that 78%, so the vast majority of Airbnbs, are available over 180 days a year.

David:

Yeah, there’s, I think, a lot of problems with those numbers. First of all, when you say “a lot of cities have”, I’m actually curious how many cities, if anyone has a running tally anywhere, because in terms of the number of cities in the world versus the number of cities that actually have regulations, it’s probably just, really, a handful. They just get all the press, like San Francisco and New York.

And, also, it didn’t talk about what types of listings those were. So, are they private? Are they private rooms but a shared home, in which case, sure, if someone has an extra bedroom and they’re renting it out 360 days a year, they’re not necessarily taking a whole apartment off of the market, which is a lot of the concern in some cities. Yeah.

Jasper:

Right, but that was 33%.

David:

And then, another thing they said, related to that, supplementing that data, the report found that around 40% of the listings in the 10 major cities tracked by the report have hosts with multiple listings, and that’s kind of implying that they have multiple addresses. And I know many people, like myself for example, who have one address but multiple listings. Like, I have an extra room when we’re here that we rent out, and then when we go on vacation, we rent out our whole home. So, they don’t take that into account when they do some of this data mining.

Jasper:

Right, got it. Okay, let’s jump to the next topic. There’s an article on Skift that talks about the prices for Airbnb accommodation and hotel rooms in Washington, D.C., around the Trump inauguration, and they’re showing some pretty crazy numbers there. I’m looking at it right now. The average for January 18th through 23rd, the property average on Airbnb is $858, versus between January 11th and January 16th, because the inauguration in on the 19th, and the week before that it’s only $200. So, it’s a 4x increase, which is quite extraordinary.

David:

Yes, that is outrageous, but the hotels are probably gouging people even more, so Airbnb hosts are finally getting a little smarter. One thing that I remember the hotel industry… Going back to your question earlier about if the hotel industry’s worried about Airbnb, one thing that it’s stopped them from doing is being able to gouge tourists during big conferences and events going on because of the huge supply that Airbnb brings. So, Airbnb hosts are getting a little bit smarter.

I’m curious to see, on inauguration day, how many listings are still available. Anecdotally, last year here in San Francisco for the Super Bowl, everyone was like, “Oh, I’m going to charge an outrageous amount of money,” and there were all these new listings. And it actually ended up, there were a lot of open listings because the supply got so large, everyone thought they were going to make a killing, that a lot didn’t go booked. So, we’ll see how things happen in the end.

Jasper:

Yeah, exactly. Once it gets some publicity that you can charge a lot of money for these events, then people get interested and suddenly you see a lot of supply. But, it also kind of highlights the importance of adjusting your prices to demand, which still a lot of hosts don’t do. So, I’m sure you can get good deals if you’re early because some hosts, they just charge the same price for every single day in the year. So, who knows, there might still be a few deals out there.

All right, the last topic that we’ll get into is, “Airbnb Dives Into Live 360 Video on Twitter, Periscope”. It’s an article in adweek.com. I will say I haven’t really read the article extensively, and I don’t understand exactly. I’ve heard of Periscope. Do you know much about this?

David:

It’s kind of like the new Facebook Live, and Twitter Live, as well, where it’s just allowing people to, you know, kind of live broadcasting. And this is with 360-degree, as well, so it’s taking the live broadcasting one step further.

Jasper:

Okay, but is that a special type of video, like 360-degree, like you can see all around? Because I know you can do these pictures now on Facebook where, instead of just seeing a picture, you can actually, you can move the picture and you can see what’s around it.

David:

Yes, exactly. And on a related note, some hosts who are listening to this should look into Matterport, which allows you to take 360-degree film of your home, and then you can put that up on your listing so people can get a nice virtual tour of your place. It’s real popular for rentals and sales, as well, and it’s getting more popular for vacation rentals.

Jasper:

Talking about videos, wouldn’t it be time for Airbnb to have a video feature on their platform, where you can just record a video of yourself walking through the apartment, and putting that up instead of the picture gallery?

David:

Yeah, that would be pretty cool. I don’t think they do that, do they?

Jasper:

No. I was wondering why not because you can upload a video on your profile, but nobody looks at the profiles, so I don’t know if that’s very useful. But, I was thinking, I don’t know, there must be a reason why they haven’t done it yet. Maybe it has to do with the loading speed of the website or something. I don’t know.

David:

Hmm, maybe.

Jasper:

But, as far as this live 360 video stuff on Twitter and Periscope, they have a schedule for free video follows so you can tune in. There’s one session, it’s called “Cameroon Fusion” in London – “Users will witness firsthand how to cook a Cameroonian feast with Airbnb host Carine, Friday, January 6th.” So, this is actually a few days ago, but, anyway, it seems like they’re going to do more of these, so when you’re a host and you have a party, you know, you hold a dinner or something, you record it live on Periscope or Twitter, and then I guess Airbnb will promote it.

David:

There’s a small contradiction, in that their big focus is on Experiences and living there, and now they’re kind of taking those Experiences and bringing them to people who aren’t there experiencing.

Jasper:

That’s true. That’s true. That’s pretty funny, actually.

Well, I think we’ve already been talking for almost 30 minutes, so I think that’s it for today. So, that went by very quickly. Before we started recording, we were discussing how many articles we should prepare, but my experience is, once you start talking, time flies.

Anyway, so thanks for tuning in, David. I hope to see you again next week.

David:

Jasper, that was a blast. Let’s do it again.

Jasper:

All right, sounds good. So, for all the listeners, every Thursday from now on, we’ll have one of these news episodes live for you. And, of course, the regular episodes on Monday, we’ll also be there where it’s the old model, interviewing people, hosts, co-founders of apps, etc. So, tune in on Monday, as well, and hopefully we’ll see you next week. Thanks for listening and have a good one. Bye-bye.

Airbnb hosts in the U.S. who want to maximize their profits, pay attention, because Everbooked can help you do this. Everbooked provides nightly optimized pricing, a comparison tool that shows you where your competition is at, and a market reports tool that gives you the bigger picture and tells you where the best places are to invest. Sign up now for Everbooked and use code GPFYP to get the first three months for free.

 

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