We speak with the country manager, Airbnb India, about the recent tweak in the brand’s strategy to bring domestic travel to the fore.
Airbnb is famous as a business that germinated right in the middle of the Great Recession of (the years) 2007-09. The startup is currently wading through a second tough phase. The travel and hospitality sector, which includes Airbnb, is among the worst hit by the global COVID-19 pandemic.
With people locked inside their homes and serious limitations on travel, business in the travel and hospitality space has been grounded. Experts suggest that people will also curtail spending on global travel due to the negative economic impact of the pandemic.
The United Nations World Tourism Organization (UNWTO) says that currently, 96 per cent of all global destinations have introduced travel restrictions due public health concerns. The UNWTO had earlier mentioned India among the fastest growing outbound tourism markets.
And rightly, in mid-2018, Airbnb launched a major ad campaign featuring Bollywood couple Saif Ali Khan and Kareena Kapoor urging Indians to explore its stays abroad.
In the face of the crisis and restrictions, Airbnb has just launched ‘Go Near’, an initiative to boost domestic travel in India. The brand has partnered with organisations like Self-Employed Women's Association – SEWA (Ahmedabad-based trade union for women), Princess Diya Kumari Foundation (Jaipur), and Nagaland Tourism to open up nearer-to-home venues for travellers.
However, with travel restrictions, fear, social distancing, and sanitisation coming to the fore, how would it impact Airbnb’s plans – especially when the pandemic has already grounded many operations?
“There is no question that these are challenging times for everyone in the business, but we have a reason for cautious optimism. We raised additional capital, and have made some changes to our strategy, so we have the resources to ensure we can withstand this storm and come back stronger,” says Amanpreet Bajaj, country manager, Airbnb India. Bajaj co-founded e-commerce platform Letsbuy.com in 2009 which was later acquired by Flipkart. He joined Airbnb in 2015 and has had stints with American Express and EY in the past.
“Travellers may prefer spaces that are private and provide control over surroundings”
He mentions that travellers will look for accessible locations that are a road trip away. “We understand that safety will come first – and many travellers may also prefer well-defined spaces that are private and afford them control over their surroundings,” Bajaj adds.
Airbnb’s global booking data suggests that travellers are looking for affordable travel and stays within a 300-km radius (that can be covered on a single ‘fill’ of fuel). This could mean that consumers want to avoid public means of transport, like trains and flights.
In India, 70 per cent of the visitors to the platform are considering dates in the near future (starting July 2020). Driving holidays, experiential travel, rural/farm stays and generally conscious travel choices are (currently) trending. In India too, the platform is banking on travel experiences that don’t involve flights, buses or trains, and can be executed with a personal vehicle.
Airbnb’s key markets in the country are Goa, New Delhi, Rajasthan, Mumbai and Bengaluru. However, the platform is seeing a surge in searches for cities located near metro cities, like Alibag, Lonavala and Panchgani, near Mumbai. Fifty-one per cent of Airbnb’s business in India includes Indians travelling within the country.
“As people travel again, enhanced reassurances and actions on safety will be key”
Bajaj says that while the road ahead is uncertain, early demand signals create some room for optimism. “Safety would initially define consumer choices. This includes cleanliness and contactless stays, as well as mode and duration of travel. As people travel again, enhanced reassurances and actions on safety will be key,” he says.
“Younger millennials and Gen Z may take the first bold steps out into the world to travel again”
Bajaj expects a demographic shift in the brand’s key audience (middle-income millennials). “We may be looking at younger millennials and Gen Z, who take the first bold steps out into the world to travel again,” he adds.
In the current context, the key offerings that Airbnb is looking to ‘uphold’ are private spaces in less crowded (tourist) areas.
Unlike hotels, Airbnb is ‘community led’, meaning, it doesn’t operate the listed premises. It is the ‘host’ who rents out parts of his/her living quarters on Airbnb, which then takes care of both the premises and the guests.
With bookings getting affected and the threat of infection from guests, we asked Bajaj about the impact.
“There are more listings and more hosts on the Airbnb platform today than when the global pandemic began. We are doing everything we can in partnership with authorities to help them in their economic recovery. Airbnb allocated $250 million to help hosts around the world, whose guests have cancelled bookings in the face of the pandemic,” he responds.