The hospitality industry is experiencing a market duel, namely between short-term home rental company, Airbnb, and the traditional hoteliers that have been around for generations.
Apps, social media, and scalable software have shaped many company landscapes where startups offer a wide variety of options to consumers, challenging traditional company models.
Instead of fighting in the duel, one brand is emulating their competitor. Marriott International has decided to meet their competition head-on by adopting similar services. Since Airbnb showed up in 2008, a study done by Makarand Mody, assistant professor of hospitality marketing in the School of Hospitality Administration at Boston University, discovered that on a common hotel performance metric, the revenue per available room fell by 2 percent in 10 large American cities.
Consumers had spoken: Airbnb had something special to rock the hospitality industry.
Now we’re seeing Marriott International roll out its new Homes & Villas service, where customers can choose to stay at 2,000 luxury properties in more than 100 different cities worldwide.
As the world’s largest hotel company, Marriott already has a presence in 40 of these markets. With Homes & Villas, the chain is expanding to hard-to-reach destinations like the Amalfi Coast, North Lake Tahoe, and Saint-Tropez.
And while some may say this is simply copying Airbnb, it is worth noting that it is a more polished version.
Airbnb had its own growing pains. Horror stories (like invasive or unreasonable hosts/guests, poor rental accommodations, wildly misleading listing photos, property damage, renter/rentee harassment, hidden camera cases, etc.) threaten the company’s reputation.
It’s unsurprising Airbnb has launched its own program to bridge the gap between traditional hospitality services and offering users peace of mind. The new Airbnb Plus curates the highest quality homes with exceptionally-rated hosts on their platform. Whether it be a guest room or an entire house, these properties are meant to provide the comforts of home while traveling… kind of like a hotel?
If a traditional powerhouse like Marriott is pushed into new service territory by a feisty newcomer like Airbnb, who likewise is exploring conventional industry standards, then which one is the best option? What makes them different? Will there be a great equalizer moment for them both?
Only time will tell if either Marriott or Airbnb can successfully adopt each other’s strategies. Either way, the industry landscape is forever changed. When visionaries tout the word “innovation” on stage, this is a real life case study of how a startup shifted an entire industry, and how the industry is shaping the innovator now that they’re all grown up.