What are hotels doing to combat Airbnb?

Showcase food and beverage menus that highlight local dishes and give guests a hometown feel. Pools, steam rooms, gyms, parking garages, complimentary valet — some hotels have been putting the amenities that traditional Airbnbs lack at the forefront of their marketing strategies.



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They limit their analysis to the 50 U.S. cities with the largest hotel room inventory. Findings from the model show that in 2014, Airbnb reduced hotel profits by up to 3.7 percent. That year, Airbnb generated $41 of consumer surplus per room per night and 26 dollars of host surplus.

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In response to Airbnb's impact, many hotels have adapted their strategies, focusing on creating immersive experiences, enhancing amenities, and providing personalized services to attract and retain guests.

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For instance, another study from the National Bureau of Economic Research that analyzed data from 10 US cities with the largest Airbnb market share found that “the entry of Airbnb resulted in 1.3 percent fewer hotel nights booked and a 1.5 percent loss in hotel revenue”.

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These declining revenues are the result of a slowdown in post-pandemic travel demand to go along with a massive increase in Airbnb supply, trends which are now causing many Airbnb operators to lose money on their rental.

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Airbnbs tend to cost less than hotels while offering more space. Besides the basic cost savings, the most inviting factor of Airbnb, there are many reasons why Airbnb is better than a hotel: Airbnbs often come with a kitchen so besides saving money on the accommodation itself, you can save money by eating in.

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Launched 14 years ago, HomeAway (previously known as Owners Direct) has been in the holiday game almost as long as air travel itself. Okay, well, not really that long, but it has still had years to mature and perfect its holiday rental game, making it one of the most important Airbnb alternatives here in the UK.

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Airbnb can best be thought of as a 'disruptive innovation' (Christensen & Raynor, 2003. The innovator's solution: Creating and sustaining successful growth, Boston, MA: Harvard Business School Press. [Google Scholar]), due to the company's innovative internet-based business model and its unique appeal to tourists.

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The majority of studies report a detrimental effect on hotel performance (e.g., Dogru, Hanks, Mody, et al. 2020; Zervas, Proserpio, and Byers 2017), indicating Airbnb as a competitor to the traditional hotel industry.

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With a strong emphasis on trust-building between strangers and a growing appeal among Gen Zs, Airbnb is poised for a future that could include everything from short-term stays to long-term housing subscriptions.

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In 2023, Airbnb hosts can expect an evolving landscape due to increased demand and higher nightly rates. This might result in increased revenue but also attract greater competition as more property owners enter the market.

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But there are now signs that this trend of increased Airbnb listings might be coming to an end as the market reaches saturation in 2023, with Airbnb's CEO warning of a booking slowdown. At the same time, vacation rental management companies reported a 13% drop in revenue per property in the first quarter of 2023.

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In 2023, Airbnb hosts can expect an evolving landscape due to increased demand and higher nightly rates. This might result in increased revenue but also attract greater competition as more property owners enter the market.

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Come Spring 2023, Airbnb will require all users booking reservations on its platform to verify their identity to book a reservation, further expanding a program that asks for credentials like a photo of a valid government-issued ID or a legal name and address.

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4. Threats Of Airbnb
  • Decreased Travel Demand: Due to the worldwide pandemic, the whole travel industry is suffering and so is Airbnb. ...
  • Increased Competitions: Airbnb tries to stand out as a powerful player in attracting hosts and guests. ...
  • Laws and Regulations in Every Country: Airbnb operates in around 192 countries.


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Considering the current trends and market analysis, it can be concluded that while the Airbnb market has witnessed a surge in listings and increased competition, it is not necessarily oversaturated. The market continues to exhibit healthy demand, and certain locations remain strong and resilient.

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