8 Ways Hotels Can Compete With Airbnb

In an industry that has traditionally benefited from scarcity, Airbnb and other home-sharing platforms have revolutionized the short-term vacation rental market and kept hotels in check. Increased supply (especially surrounding big-ticket events and peak seasonality) has intensified competition, forced many hotels to devise new pricing strategies, and made it harder to compete with Airbnb. Travelers have undoubtedly benefited from the subsequent price drops, but hotels are struggling to stay afloat.

As an integral player in the field of vacation rental data, AllTheRooms Analytics has witnessed first-hand these changing dynamics. Based on unique, comprehensive data, here’s our rundown on the eight ways hotels can learn from and compete with Airbnb.

The first step hotels can take to learn from their competition is to conduct a thorough analysis of the market. Understanding the degree to which a particular area is being impacted by incoming waves of vacation rentals is integral to smart decision-making. Tracking key performance indicators like ADR, occupancy rate, RevPAR, and supply equips hotel managers with the tools necessary to remain competitive.

Branching off the theme of data, one of the principal differences between Airbnb and many hotel chains is the capacity to track the entire guest journey under one cohesive platform.

Whereas Airbnb’s customers conduct everything from searches to communication, payments, and reviews under one central hub, hotels still often run outdated protocols that span across the mediums of telephone, email, chat, and websites.

If the hotel industry is looking to truly compete with the sharing economy, they should consider consolidating the spaces of customer interaction and leverage the data acquired. Data can be used in a number of ways, including building robust customer profiles which can be used to create customized promotions and unique marketing messages.

Tastes are changing. More and more, travelers are opting to stay in accommodations that offer authentic experiences and unique opportunities. In effect, they’re looking to stay like a local, which often runs contrary to the corporate, cookie-cutter branding that traditional hotels are unfortunately bound to.

Hotels should focus on marketing their properties as local, historic, distinct, or somehow emblematic of their location. As the best Airbnb hosts do, hotels could offer helpful tips and insights on things to do in the near vicinity — not in an elegant brochure, but rather in a simple, friendly, bullet-pointed email that feels more like personalized advice.

In that same regard, hosts could benefit from personalizing their concierge service. When a client books an Airbnb, they have a profile of the host and a number of the reviews. As the industry currently stands, when someone books a hotel, they have no such information on the hotel staff. Consider assigning guests to ‘hosts’ who send automated welcome emails and serve as the guest’s trusted point of contact.

Since the introduction of Instant Book by Airbnb, the platform has streamlined conversions and begun dominating the industry. Even before and after the booking process, Airbnb’s hosts are encouraged to respond within an hour of any communication.

Even though many independent or non-chain hotels don’t have the staff to deliver this kind of customer service, competing with Airbnb needs to begin with prioritizing immediacy. Any hiccup or significant delay in the shopping process can turn away potential customers.

There’s a certain level of service, comfort, security, and ease-of-use provided by hotels that short-term vacation rentals simply can’t match. Room service, 24-hour security, sparkling cleanliness — hotels have thrived for centuries by clinging to these pillars of hospitality and now is no time to stray from those tactics. Locke Hotels are excellent examples of how hotels can leverage these amenities to compete with Airbnb.

While more than 50% of Airbnb guests cited “availability of kitchens” as an influencing factor in their decision-making process, the number of guests who actually use those kitchens is considerably lower.

For business travelers in a rush or vacationers looking to taste local cuisines, cooking isn’t always in the cards. Thus, hotels with an on-site restaurant or bar are immediately at an advantage. Showcase food and beverage menus that highlight local dishes and give guests a hometown feel.

Pools, steam rooms, gyms, parking garages, complimentary valet — put the amenities that traditional Airbnbs lack at the forefront of your marketing strategies.

While Airbnb prides itself on being part of a sharing economy, the company’s evolution has shifted its hosting strategies away from one-off spare bedrooms and towards the market of entire self-service homes and apartments. With Instant Book and access codes for entry and exit, it’s very likely guests never have any interaction with the host (much less other travelers).

One of the hospitality industry’s strengths is the common spaces they maintain. Hotels can curate spaces where guests — and even locals — can socialize, do laundry, use a shared workspace, and drink a coffee. AC Hotels by Marriott International are great examples. Once property managers start implementing community hubs into hotel design, hotels will begin to resemble more of a ‘sharing economy’ than Airbnb.

Imagine if every short-term vacation rental was forced to fend for their own exposure and didn’t benefit from Airbnb’s central database? That’s essentially the handicap hotels are playing with. With no central booking platform, exposure becomes all the more difficult (and important).

Hospitality software run the gamut from free, no-frills services to all-out solutions that take the reigns on the entire process. Features include channel management between third-party providers, payment processing systems, guest communication platforms, and more. Arguably the most important, however, is the capacity to publish your listing on hundreds of the most important sites. While direct bookings should be the priority, exposure is a key to staying relevant.