Airbnb Aims To Solve ‘Overtourism’. Are Tweaks To Its App Enough?
TBrian Chesky, CEO of Airbnb says the main problem is the search bar. The platform asks users a question when they first open it. Which direction do you wish to travel?? Chesky realized that this is an incorrect way of approaching travel. Chesky wants Airbnb to meet users sooner on their journey and the first step of any trip is not to figure out where you’re going, but to imagine yourself anywhere other than where you are. At the same time, Chesky also seems to realize that Airbnb’s standard way of doing business has created some unforeseen problems.
Airbnb announced this week that it is making its 10th largest upgrade. The site has three major updates. In the event of unforeseeable events, users will have access to travel insurance. (Of the ‘this place sucks’ kind rather than the global pandemic kind.) This website will help them split the journey into two locations. Which direction do you wish to travel?They have other options when it comes to planning their vacation.
A.I. and humans combined. bots and humans have combed through the site’s millions of listings and now offer 56 different search options. A user can search to find a place that she has wanted for years, such as a cave or a yurt or castle or treehouse. You can even search by the name of Frank Lloyd Wright and Rem Koolhaas, should you, like Chesky from Rhode Island School of Design, be a big fan of architects. Chesky loves the fact that nearly every architect is name-checked under this category. You can use these categories to search for a place to ski, go on a boat or to play the grand piano. You can search for a pool that is truly epic if they don’t need one.
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“We’re in 100,000 cities,” says Chesky, sitting in an Airbnb in the New York City’s East Village neighborhood, a few days before the update goes live. “The problem is you will only type in what you can think of, and what do people think of? Las Vegas. New York. Rome. Paris Miami. L.A. Before the pandemic, a lot of people were going to a lot of the same cities.”
Also before the pandemic, Airbnb had been working on an airline-booking app and a travel magazine to get access to travelers’ attention earlier in their vacation planning, or “top of funnel,” as Chesky puts it. The company had to abandon those plans when travel—and Airbnb’s revenues—came to a standstill a couple of months into the pandemic. They might not come back, he says. It seems he’s found a better way to get there.
Airbnb was hit hard by the pandemic, which saw a quarter of a million cancellations. The company had to lay off approximately 25% of its workforce, stop its paid marketing activities, borrow money for its survival, and postpone its IPO. The company bounced quickly and was able to issue an initial public offer in December 2020. “Airbnb recovered faster than most other travel companies during the pandemic,” says Chesky. He calls the last two years “the most productive in our history.”
The company’s financial performance has been poor for three consecutive years, with losses of $674m, $4.58billion, and 352m respectively in 2019, 2020 and 2021. Its stock price has dropped nearly 26% since its 2020 IPO.
At a press launch a few days later, replete with a film of Chesky traveling to various exotic Airbnb listings with his dog, Sophie Supernova, who made a live appearance later in the proceedings, he compared Airbnb’s photo-heavy new site to his main competitors, saying “I just don’t think travel sites should look like online casinos.” He booked a split stay in Kentucky live for the gathered press. With a net worth around $9 billion, he is able to afford the cancellation fees. He was fascinated by the amazing dwellings people offer in New Zealand, such as a yellow submarine.
Although the redesign might seem minor, it is a useful upgrade for vacation-seekers. It’s just another option among a multitude of options. With slightly better searching skills, it was possible to locate many of the same qualities on the new site. Chesky is a social worker and his parents hope the new changes can address many of the social problems Airbnb and the short-term rental market in general have generated, including the unmanageable influx and rising rents.
“Overtourism isn’t too many people traveling in the world,” says Chesky. “Overtourism is too many people going to the same place at the same time. We’re trying to actually help solve this problem. This is what we want. [Airbnb’s app] not just about the destination, because if it’s about the destination, it’s only about the ones you can think to type in, and we’d like to redistribute people.” Similarly the split stays upgrade offers people a few days in one town and a few days in a nearby place, thus encouraging travelers to widen their horizons.
It’s clear Chesky is not thrilled that numerous studies point to Airbnb and other short term rental outfits as one of the drivers of unaffordable housing. It is difficult for cities to have enough rental properties on the market when landlords make less in a matter of days than what they make over a month. As the rental market is booming, investors have begun to buy homes in tourist areas, just so they can Airbnb them. This, among other factors, has left many cities with an affordable housing shortage, where teachers and public servants can’t afford to live in the areas where they work.
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“When you build a platform, and hundreds of millions of people use it, it’s always gonna have unintended consequences,” notes Chesky, who is quick to point out that AIrbnb also helps keep people in their homes, by providing them with income. Indeed the business started in his own home when he and his roommate couldn’t afford to make their rent. “If you give power to people, they’re going [use it] in ways you don’t intend. And then you’re going to need to make some adaptations.”
His company’s adaptations include working with civic regulators and to try to sprinkle the visitors around a bit more. “We want to partner with cities,’ says Chesky, his voice speeding up a little. “If there are issues with housing, we will work with the cities to comply with registrations. We’ve done that in hundreds of cities. But we’re also going to try to help redistribute people and help them stay longer.”
Airbnb can be used to provide shelter for those who are being forced to leave their homes by rising costs. This is one way that it might help to solve some of its problems. Its hosts have already provided shelter for 20,000 Afghan and 20,000 Ukrainian refugees, and Airbnb.org, the company’s philanthropic arm, works with domestic violence organizations to provide housing for women who have had to flee their homes, so the company has a prototype to work with. But Chesky’s not sure. “Homelessness is something that absolutely, I’m interested in helping in some way,” he says. For now he’s more interested in refugees, many of whom are being housed by Airbnb hosts at no charge. “I think the refugee crisis is so great. And there’s so few people working on it. So I think that we maybe are in a unique position to help make a dent in that problem.”
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