Why Airbnb had to act on Total Price Transparency / AirbnBUST / VRBO, Hopper, Booking / Lodgify

Are you a person who pays attention to details? Usually, I am not. Unless it has to do with Airbnb’s new features ;-)

This week, from the Wall Street Journal to travel news sites, everybody wrote about? Airbnb ’s upcoming “total price display”. It should create fewer bad surprises for travelers when they see the final price of their rental, all fees included.

Yet, I did not see anyone report that?this new price display would be … optional … and not even the default display. Indeed, Airbnb users will have to?turn on a toggle?before conducting a search before seeing this total price.

In the?European Union,?Airbnb has had to display, by default, this total price within search results?since 2019?(and?with taxes included,?unlike in the upcoming US version). While European consumer laws mandated such a total price display, it is?social media anger that got Airbnb to (sort of) do the same in the U.S.

Best regards,

Thibault

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Top articles this week?

Brian Chesky & Fees: Airbnb to display total “all-in” price to fight against perception it’s become un-affordable

• Starting December 2022,?Airbnb users will see the total price in search results, as well as on the map, price filter, and listing page. Before confirming their booking,?guests can view a full price breakdown?that shows Airbnb’s service fee, discounts, and taxes.
• Users?will have to use a toggle button?to “Display total price – Includes all fees, before taxes.”
• Displaying a total price (night rate + fees) earlier in the booking process is something that is not new:?In Europe, Airbnb’s biggest market by host count,?the company has been doing so since 2019, due to E.U. consumer laws.
• In the US, it is?the pressure of social media?that is pushing Airbnb to act, not the law.
• Airbnb does not want to enter a recession period with the image of an expensive travel option.
• The?most affected will be hosts whose pricing tactic is to show a low nightly rate and make up for it with a high cleaning fee?once they have attracted travelers to their listing page.

#AirbnBUST: Will Airbnb’s 2022 Winter Release aggravate hosts’ fears about oversupply?

• While?Airbnb has reported?in Q3 2022 its?strongest quarter ever?in terms of revenues, with demand up 25% compared with Summer 2021, individual hosts have complained about getting fewer bookings since July.
• Meanwhile,?Airbnb wants to add millions more new hosts?to its platform.
• Since mid-Summer 2022, Airbnb hosts have used the?#AirbnBust?hashtag on Twitter and TikTok?to share complaints about a drop in bookings.
• For some hosts, the situation is so bad that their?Airbnb revenues do not cover their expenses and mortgage?payments anymore.
• In cities, supply is returning, but?demand is still lagging?behind 2019 levels. Meanwhile,?in traditional vacation rental markets, the boom in?new supply is so big that restrictions and bans are becoming more frequent?to protect the housing market.
• Will the?new supply drive down night rates, making it harder for some hosts to pay their mortgages while making the platform more affordable for travelers?

News round-up for Vrbo, Hopper Homes, and Booking.com

• The one thing that?Airbnb does not have: A loyalty program?for guests.?Booking.com’s Genius program, Hopper’s Carrot Cash, and Vrbo’s upcoming One Key?are three loyalty programs these alternative sites to Airbnb are banking on.
• Vrbo ?( Expedia Group ):?Still strong, more integration into Expedia Group’s loyalty program and tech stack in 2023
• Hopper claims to be #3 OTA in North America?and 20% sales are from international users. On November 7,?Hopper?announced that it had?secured a $96 million follow-on investment?from Capital One.
• Booking.com : Q3 2022 was the highest ever in revenue, Alternative accommodations are 30% room nights and growing by 11%, growth increasing since Summer despite tensions, #1 downloaded travel app globally

Lodgify raises $30M while focusing on the long tail of STR hosts

• Vacation rental SaaS startup Lodgify has just raised?$30m in Series B funding.
• Lodgify says that, unlike other industry players such as Guesty, it’s growing fast by?focusing on?the opposite end of the short-term rental industry:?Individual hosts and small property managers, where 80% of the market is.

Video of the Week

Why Airbnb had to act now on price transparency

I’ve put together this video going over the reasons for Airbnb’s decision to make its price more transparent in the US. In other countries, for instance, within the European Union, it’s been the case for 3 years! What’s the impact on hosts?

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Industry Events

Scale Rentals France à Paris en novembre 2022: Pourquoi y aller

De la distribution sur Airbnb, Abritel, ou Booking, en passant par les réservations en direct, les opérations, les effets d’une possible récession économique, les dernières tendances de marché, SCALE France à Paris promet une dose de connaissances pratiques, tactiques et stratégiques.

Pendant deux jours de sessions, on va assister à des conférences et à des tables rondes. Les sponsors n’ont pas la garantie en fait, d’avoir un temps de parole. Donc efectivement, quand on voit quelqu’un sur scène, c’est qu’il y a un vrai contenu que l’on veut partager.

En utilisant le code RSU22 , nos lecteurs obtiennent 20% de réduc sur les tickets Scale Rentals France.

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No #FOMO

Last week, I reported on?Booking.com’s strategy in the U.S., gave my predictions for updates hosts can expect in?Airbnb’s upcoming winter release, and shared takeaways from the recently concluded?VRMA International conference 2022.

That's all for now.

Have a great rest of the week!

Thibault Masson

Founder, Rental Scale-Up

Grow your network, add me on?LinkedIn.