Airbnb, a US-based online accommodation marketplace, forayed into India in 2016 and has been growing at about 70% since its official launch. Currently, it has over 50,000 listings in India, and more and more Indians seem to be opting for it not just within India but also abroad. Amanpreet Bajaj, country manager – India, Airbnb, talks about the India story, how the platform’s cost-effective model works, and more
How has Airbnb been doing in India compared to other countries?
Overall, we have seen 70% year-on-year business growth since we launched. Our listings in India have grown almost 200% and it’s only growing. Almost 2 million Indians used us last year alone. And all three segments of our business—Indians travelling abroad, Indians hosting Indian travellers within India, and foreigners coming to India—have seen robust growth. From a global perspective,
India is one of the fastest growing emerging markets for Airbnb, and is among the top five growing markets, globally. We aim to reach about a billion Airbnb users by 2027. Airbnb globally has seen more than 500 million guests. We are in almost 100,000 cities, across 191 countries with more than 6 million listings across the world. India is going to play a critical role in reaching the goal of 1 billion Airbnb travellers.
Airbnb is seen as a premium option for travellers. So how are you positioning yourselves in India, especially with Oyo offering cheap options as well as premium options under its Townhouse offering?
The beauty of our platform is that there is something on offer for everyone. We have options for very economical stays, say, under ₹1,000 in a city as well as ₹25,000-a-night penthouses, or a ₹1 lakh-a-night villa in Goa. We want to ensure that there is an Airbnb across all price points. What we have seen is that the accommodation need varies based on the type of the trip the person is on—whether he is travelling with family, friends or for work.
Very recently, we also launched Airbnb Plus (with listings of the highest quality homes and exceptional hosts). These are homes that are verified for quality, amenities as well as an up-levelled design. There are hosts that provide exceptional hospitality and have unique traits. We have a few homes in Goa now and we will be doing a phased launch in other Indian cities.
You also have a product called Airbnb Luxe. How is that different from Airbnb Plus and what all does it entail? Are there any India plans?
It will come to India at some point of time. Airbnb Luxe are luxurious homes that are hand-picked for their unique space and come with various trip designers. So somebody will sit with you and understand your travel needs and provide an experience. Today we have more than 2,000 luxe homes across the world. We have a 100-point checklist to decide whether a property qualifies for being luxe or not.
In India, what kind of properties are more in demand?
Adoption of bigger houses is on the rise on the platform. The other trend is during weekends, people are not travelling to a different city all the time. Staycation is becoming a big play in India. People are booking something 10 km outside their city and then travelling in large groups. So a lot of farm houses or villas get booked on Airbnb. We are also seeing heritage listings being booked. So in Goa, people are looking for 100-year-old villas or Portuguese villas. We have a villa which is 400- year old and the family still lives there and hosts people and shares the great stories they have. In Rajasthan, we are seeing old, refurbished havelis getting listed. As awareness increases, more unique places will come on the platform.
Airbnb has also been catering to business travellers. What are you doing to target them?
It is something very recent but we have seen rapid growth. Almost 700,000 companies globally use Airbnb. So 15% of all Airbnb stays are now for work. Even in India, more than 4,000 companies are using Airbnb for work and we launched it only six months ago. Corporate travellers are incorporating work and leisure. Also, the number of people in a reservation is not one. It is two to four people who travel together for work. So there are teams travelling together, brainstorming and bonding together.
Relocation is also growing. So if you are moving to a different city, and you want to first get a feel of the neighbourhood, it’s best to book a house on Airbnb and stay in the neighbourhood before doing it for a longer term.
Can you elaborate more on liability insurance and property damage protection that you offer to Airbnb hosts? Are they charged anything for it?
For a small fee that we charge our consumer, which is the platform fee, we provide a $1 million damage protection to host. Any specific damage to your home is covered under the $1 million umbrella. And accidents can happen. If a family is visiting, and they are using something in your living room and something breaks, we don’t want the host to have a sleepless night. However, cases like property damage are extremely rare. For almost all the reservations that we have had in the last year, globally, the cases of significant damage above $1,000 were 0.001%.
Are rentals in the Airbnb model better for the host? Why shouldn’t someone just put a property on rent instead?
You should look at Airbnb as a community who like to welcome people from other parts of the world. So a direct rental comparison may not be right. The year-on-year growth in listing clearly shows that it makes economic sense for people to do this while giving them the flexibility to do much more. As a people-powered platform, flexibility is what drives growth. You can turn off hosting whenever you want, you can host for a certain amount of days in a year, or a certain price in a certain year. That flexibility makes the platform more robust.
What about the pricing?
We are an open platform, so the pricing is decided by hosts themselves. We have built-in tools to help the hosts choose the right pricing. The pricing is dynamic but the final choice rests with the host. We take a revenue fee out of it, which is 3%. A lot of hosts on Airbnb don’t do it for money. I met a host who were empty nesters and they priced their lavish bungalow at $20 a night with meals. So when we told them you can charge two times the current price, they said they did this not for money but to meet new people.
What percentage of the traveller’s pie are you targeting?
Our target right now is the millennial population in India because we believe they are more likely to value experiential travel. Also, they are trend setters. What they do and how they travel becomes a trend for other segments to follow. So our entire focus right now is to ensure that the Indian millennial population across top urban areas as well as tier II towns understand the benefits of this network. We want to ensure than we are the default pick for their travelling.