Airbnb business model?

[Laura2592]

I've been thinking about this with recent changes. Ages ago there was a Dublin host named Susan who did a deep dive into ABB booking algorithms among other things. Like many hosts she no longer posts here and I would be surprised if she hadn't left Airbnb. What she posited is that ABB only wants hosts to have about a 5 yr shelf life and that it's model depends on turn over for new hosts. Much like a restaurant, if the same table stays forever it takes away from your ability to seat more people and profit. Unlike a restaurant there's not a finite number of hosting situations...new houses are built, people sell and buy, open up rooms etc. Though the supply is not inexhaustible it's not anywhere near touching the bottom of the hosting pool yet.

As new hosts come in, stricter rules and higher fees are just the norm. Experienced hosts can pound sand or get onboard. This way ABB can keep inventory fresh and control more about what hosts do. 

Conspiracy theory? Or do you think this is the actual model?

[Suzanne302]

@Laura2592 

Susan was banned from the CC, she didn't go voluntarily.

As for a conspiracy theory and Airbnb's great plan, I don't think those in charge are that bright. They are chasing dollars but do not know how to think strategically. Someone gets an idea...Ooh, let's try that! Those in power at Airbnb use what I call the shotgun approach to business instead of the smarter, targeted approach. Let's just fire a shotgun in the air and with all the pellets that come out, we're bound to hit something!

[Rhonda301]

You are so right.  

[Anonymous]

@Laura2592   When Airbnb gets scared about a CC  contributor telling too many uncomfortable truths, they ban them. @Sarah977 , Ute, Susan...I rest my case.

I don't know if their search algorithm puts a time bomb on listings with planned obsolescence in mind. But one thing we know for certain is that there's no reward or incentive for longevity. Even if you've had a consistently well-rated, established listing for 10 years, the highest recognition you can achieve is the same stupid badge they toss to new hosts after 3 months. That's not an accident. They're afraid of veterans who know what's what; they want their stable full of hosts who are easy to manipulate into compliance with BS. 

[Helen744]

@Anonymous From where I sit , I am beginning to wonder if 'hotels ' are beginning to fight back and try to put a few spokes in the works . My listing comes up on google as",not a hotel" ' 'not a professional business'  ' room only for motor bikes' under parking and as some type of hotel with every room having 'kitchens and patios and hairdryers etcetera' and ,this is the best bit '24 hour concierge service' and six guests and a much lower price .and also 'not available 'not now , not ever. ???? still scratching my head . time to change my title or ? H

[John2406]

Until @Laura2592  raised the possibility, I must admit I'd not really thought about the longevity of being on the Airbnb platform, but in the same way that modern Companies prefer to employ younger individuals; that many Companies ' employees' are on zero-rate contracts, and that there's usually a ready supply of young people to call upon, I can see and understand the logic that Airbnb and other similar OTA's might be employing with regard to promoting/not-promoting established businesses.

Yes, I do accept that there have been 1000s of new accommodations coming onto  the market since the end of 2019, and yes, those of us who have been established for many years may well be affected by that influx, but (and I don't know what's happening in the US, but here in the UK) HMRC (The Tax Office) is clamping down very hard on everyone who set up as a holiday accommodation provider in 2020-2022, and I fear a lot of people will find themselves having to pay tax on undeclared income (and HMRC know who's not declared their earnings, because Airbnb provided all of the information in exchange for a reduction in their own amount of Tax to pay!)

Looking into the future, one has to wonder what it holds for everyone who jumped onto the bandwagon of OTAs, for whilst such individuals should  - legally -  have declared what they received, I'm sure that they're not going to remain with any OTA that passes their details to those who collect unpaid Taxes, whilst I'm sure they also won't remain once (here in the UK) Governments' legislate for, and Councils' implement Licencing, and other Rules for Accommodation providers!

Airbnb may well be looking at ways in which to weed out those who have remained with them "too long", yet I am also of the opinion that if any properties are constantly being booked, they will remain the core of  Airbnb, as they are the profitmakers, and as such, Airbnb won't want to lose them!

[John5097]

@Laura2592 

I don't think its an actual model. Airbnb gives listings a priority when they first launch to see if they get any traction. I haven't seen any of the popular listings similar to mine leaving. But think the recent update went too far and didn't display the number of reviews, which favored new listings.

There likely was an increase in listings from the low interest rates and Airbnb was eager, maybe too eager, to get those listings to expand their profits. 

Overall newer properties may be more attractive as a business model. Its more likely they have been recently renovated and for whatever reason listings sell or host has other obligations, was more of a part time job. 

Other factors to consider is that there may be more scammers and guest will become more leery of booking with host or listing with no reviews. They may be taking time off from work, a business trip, medial trip, wedding, family event, etc or just may not want to risk getting scammed. And scammers will likely become worse for both guest and host. 

I've had great success so far and guest have been great. But I realize the risk, that its kind of like eBay in a way, there is some risk involved, and my listing could be brought to an abrupt halt. I'm more concerned about not getting enough bookings after the recent updates. 

I also don't understand why some host keep hosting if it makes them so miserable?  I think this goes beyond expressing opinion on policy, and I don't think any policy change would change their disposition. 

In reality host need other options if STR doesn't work out. It may conflict with their work schedule, etc. Airbnb could also focus on ways to retain host. In my experice customer service has always been very good. I hardly ever need them though. Airbnb is just for bookings, that's all I need them for. If things don't work out, I have another account set up and ready to go live with another booking platform. But hopefully in 5 years I won't even need to do ABB, so that also may become less stressful and I may start to move more towards promoting the kind of things I want to promote. 

[Helen744]

@John5097 have you seen what has been happening to the Winsconsin hosts and other hosts . ?all of their bookings supended and cancelled month after month .Maybe some people have a right to whinge because 'something is going wrong ' and the boffins making policy will not or cannot admit it or share it .Henny Pennys we are not .We are trying to run our businesses and would like a viable partner not a punitive one who appears to be re arranging the deck chairs .H

[John5097]

@Helen744 

That’s not what I was taking about.  

If you have any specific bugs you are having problems with you can start another topic. Host all the time post about software glitches that gets passed on to the right department

If you think Airbnb is too punitive once again you could start a new topic. Or give your reasoning for this topic. 

My question was why do so

e host keep hosting if it makes them so miserable? I’m talking about the host who just rant and rave all the time. 

Fir the vast majority it is a good opportunity. 

[Laura2592]

@John5097 we don't host any more. It wasn't making us miserable so much as we had a scary experience that showed us how much liability we truly had with a terrible guest. Wake up call indeed. 

We also couldn't travel to our vacation home in New Orleans, take a trip to Europe, or attend a wedding rescheduled at the last minute for a dear friend because we had to clean up after our cleaners most of the time. 

We couldn't enjoy our own cottage as we wished as often as we wished because we were very booked. Every time we blocked days we would get messages to unblock. Occasionally they booked inexplicably due to a "bug" though they were blocked.

We realized that if we sold we would make a substantial profit in a short period of time.

We got tired of driving an hour and change round trip after a hard work day to assist guests with lost cats, operating the fireplace flue, lockouts from automatic locks (with hidden keys. Occasionally a guest would panic and have a total meltdown and we had to go and find the key that was right where we told them it was.) We were weary of the abuse of the space, items going missing that we had just replaced, and damage that would eventually render our cute schoolhouse either uninhabitable or in need of major repairs.

We realized that instead of 5-10% complainers, we had about 20% post pandemic and burnt out on emotional labor.

We realized that we could just park our profits into a closer property with a long term tenant and go back to enjoying things like spontaneous weekend trips and long evenings at home together.

[John5097]

@Laura2592 I meant to mention that you created more positive and relevant topics than anyone! At least when I first joined the CC you used to say hosting exceeded your expectations. That's how mine has been. I didn't anticipate being this popular.  Its totally understandable that a remote whole house cottage listing could become too troublesome. I thought you contributed very constructive feedback as well for specific policies. I recall the tipping point was a guest shooting wildlife in the yard. 

I'm glad you moved on to long term place that better fits your schedule. 

For me now its my best option. I think its a great option for vast majority. There is just some risk involved that will never change. 

I still think the vast majority of host should aspire to improve their own listing  and be able to manage their guest and make it work.  

Life is too short to take issue with every little thing someone post. I think everyone just has to stay on top of things as best they can and it has a way of working out. You were an excellent host so I hope it continues to be a positive part of your life as you put a lot of work and effort it it. And of course continue to share your truth. I'm just not sure if other host have been the best influence for you either. At times I find that its just too negative and its better for me to just figure out things on my ow. But such is the internet and maybe that's not the case for you. 
 
Definitely wish you the best! 

[John5097]

@Laura2592 

Also I probably should have started my own topic asking why host keep hosting if it makes them totally miserable. Although like I said, from my perspective you were always one of the most positive and created the best topics so am a little bit of a loss and glad the long term rental is working out for you! 

[Z-2]

@John5097 @Laura2592 I think there might be another reason Airbnb want to attract more new hosts. It's the stock market. For the existing hosts like us, mostly will still stay even though we know Airbnb had many problems especial CS and recently release. But as a rental platform, they still a very good marketing site and charge less commission. So we will stay.  Airbnb want to keep the new hosts come in. For stock performance, how many new listings and how many total listings Airbnb has is very importance for stock investors. So for the pressure of  stock investor, Airbnb has to expending the market share and attract more new hosts. I think the summer release is designed to attract the new hosts and the uniqueness.

[John5097]

@Z-2 

As anticipated ABB crushed it in Q2 earnings report. Q1 2022 was also their first profitable first quarter. 

Stock price is still down, despite record income, but if they keep up profit for a year ABB will meet requirement to be in S&P500  which should be interesting as retirement index funds would then be funding the stock. 

https://www.cnbc.com/2022/08/02/airbnb-abnb-earnings-q2-2022.html


Edit, the number of bookings did miss estimates though. Airbnb said it was canceled flights, but new roll out, inflation? The next Q3 is always their most profitable, but Q2 had surge from pent up demand. That's why they are trying to squeeze as much money out of guest and host, which is confusing to a lot of guest and the search function now has filters for longer stays. 

[Z-2]

@John5097 Need more bookings is the key here but seems like investors want more. People are in doubt if abnb can continue growing fast and profitable since the cost will increase and hotel will be back. I am not sure how abnb stock price will go but as a host, I do feel the bookings (for my listings) do slow down especially after summer release from Airbnb 

[John5097]

@Z-2 

Yes, I also just need the bookings from host end. It seems like Airbnb has compromised functionality of search and bookings, in favor of trying to coerce guest into week long stays. 

ABB is looking at it only as a way to increase corporate profits and not the guest experience.