Why do people stay in Airbnb?

SSTH Editorial Team | 29 Jun, 2017

Airbnb has been a preoccupying issue for the hotel industry for the last half decade or so.

A flood of commentary and analyses have suggested that hoteliers have much to learn from Airbnb and what motivates travellers to book accommodation with the online behemoth.

So what are the main reasons that lead people to stay in Airbnb rentals?

In fact, the simple answer is that it's cheap, according to the results of a survey released in August 2016, which was carried out by Professor Daniel Guttentag, assistant professor at the Ted Rogers School of Hospitality and Tourism Management of Ryerson University in Ontario.

Travellers also cited 'convenient location' and 'household amenities' as key motivating factors, according to the study.

Homes on Airbnb


'Sharing' aspect less important

Airbnb guests also tend to rent entire homes rather than sharing the accommodation with a host. In fact, they are generally less motivated by the opportunity to interact with the host or other locals, or by the promise of an 'authentic', local experience'.

These interesting findings tend to debunk Airbnb’s marketing efforts and general impressions retained throughout the hospitality industry, which emphasise the service’s experiential side.

How many times have hoteliers been told that they must offer more authentic, local experiences in order to compete with the likes of Airbnb?

It seems that this point has been received too much attention. In fact, travellers who use Airbnb tend to be motivated by the service’s practical benefits (low cost, convenient location, and household amenities).

Homes on Airbnb

Guttentag's findings based on solid methodology

In order to determine the motivations of Airbnb users, Professor Guttentag conducted an online survey between July and October 2015, which was completed by 844 respondents who stayed in an Airbnb accommodation at least once within the previous year.

The survey queried the participants, mostly from Canada and the US, about their motivations for using Airbnb and whether they used the service as a substitute for existing accommodations. The participants were also asked about the purpose of their trip, party size, and length of stay.

The report's key findings include:

  • Tourists are mostly motivated to book Airbnb accommodation because of its low cost, convenient location, and household amenities.
  • 61% chose Airbnb as a substitute for a budget or mid-range hotel;
  • 26% indicated that staying with Airbnb led them to increase the length of their trip;
  • 70% stayed in an “entire home” rather than in “shared accommodation” together with a host;
  • 89% were “satisfied” or “very satisfied” with their most recent Airbnb stay, and 91% were “likely” or “very likely” to recommend Airbnb to others; and
  • 62% indicated that they were “very likely” to use Airbnb again within the following year, compared to just 26% who indicated it was “very likely” they would book a hotel room within the following year.

Homes on Airbnb

Airbnb customer profiles

Guttentag also identified five typical Airbnb guest profiles based on their comparative motivations for using the service:

Money savers

These travellers choose Airbnb mostly because it's cheap. They are typically young (30 and under) and generally are not travelling with children.

Home seekers

These travellers are primarily interested in the household amenities and large space provided by Airbnb rentals. They almost exclusively stay in entire home rentals. Compared to other Airbnb guests, they tend to be somewhat older, have more education, travel with larger groups and take longer trips. They also are more frequent Airbnb users.

Collaborative consumers

These travellers are motivated by Airbnb’s sharing economy philosophy, the opportunity to have an authentic experience, and the chance to interact with their host and other locals. They are more likely than other Airbnb guests to be backpacking, and frequently stay in shared accommodations.

Pragmatic novelty seekers

These travellers are drawn to the novelty of Airbnb and the household benefits the accommodations offer. They almost always choose to rent entire homes. They are also not regular Airbnb users.

Interactive novelty seekers

These travellers are attracted by the novelty of Airbnb and by the chance to interact with their host or other locals. They often stay in shared accommodations, and generally have limited experience using Airbnb.


Airbnb’s two products

Guttentag notes that Airbnb’s low cost remains the most important motivation for nearly every segment.

Thus, the biggest differentiator between the segments is the degree to which guests are motivated to use Airbnb by the opportunity for local interaction.

Such interaction is an important draw for 'collaborative consumers' and 'interactive novelty' seekers, but not as much for 'money savers', 'home seekers', or 'pragmatic novelty seekers'.

This motivation is also closely associated with the type of accommodation used, with 'home seekers' and 'pragmatic novelty seekers' almost exclusively staying in entire homes, and 'collaborative consumers' and 'interactive novelty seekers' much more likely than average to stay in host-present accommodation.

Treehouse on Airbnb

These findings suggest that Airbnb’s entire homes and shared accommodations represent two fairly distinct products.

This distinction presents a challenge for Airbnb’s marketing and highlights the potential value in marketing the two products differently.

Indeed, it seems very possible that Airbnb eventually will better structure its diverse inventory by launching sub-brands that will be marketed independently, such as Airbnb Explore (for shared accommodations), Airbnb Homes (for entire homes focused on space and amenities), Airbnb Pro (for rentals aimed at business travellers), Airbnb Lux (for high-end rentals), and Airbnb Exotic (for exotic accommodation

 


 

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