Airbnb was booming before the Pandemic. They had just taken the company public, and then it all fell. The Pandemic hit, and bookings went down. The company floundered. But somehow, Airbnb found its footing and came back from the brink of bankruptcy. How did they do it? What is the outlook now for Airbnb? In this article, we will discuss what Airbnb did to come back from the brink of disaster.
Airbnb has come back from almost total failure. A few months after the Pandemic started, bookings dropped by nearly 75%. Its public valuation went down by 50%. Recently, the company has made a dramatic upward turn and is headed toward a $30 billion valuation.
How Did Airbnb Make The Dramatic Turnaround?
Yes, there was private funding, and that kept the company afloat while they made critical changes. Airbnb cut its marketing costs, slashed its executive salaries, and changed its marketing focus. For example, they started to target remote workers looking for long-term rentals. They focused on this area and addressed the Pandemic customer needs to find a haven to weather the quarantine. Airbnb also focused on basic employee needs, which created loyalty, and helped them turn the company around.
The leadership team realized they needed to make quick and definite changes. Travel changed forever. The company streamlined the offerings, scaled back, and changed its primary focus to cater to remote workers who needed longer stays. People wanted to go to out-of-the-way rural places and stay away from big-city destinations. So in the last part of 2020, more people chose Sicily over Florence and Venice, Devon over Oxford. As a result, Airbnb began to market the small area vacation.
What Are Airbnb Hosts Doing?
Many Airbnb hosts – aka property owners – had to decide what to do. Many people decided to simply sell their houses. They took the money and ran.
Other homeowners that hosted on Airbnb but only offered a private room listing to guests had to make a tough decision as well. If they didn’t want to sell, what could they do? Several homeowners were debating moving vs remodeling their house. People wanted to weather the storm of the pandemic, and they did! This helped Airbnb as a company hold its footing.
“When there is blood in the streets, there is money to be made”. This statement holds true even for the pandemic, as hard of a pill it was (and still is) to swallow.
Some homeowners doubled down on their home buying efforts. Vacation rentals in places near national parks, or in the mountains/woods, did incredibly well after the initial lockdown. This encouraged more people to purchase a vacation home and become Airbnb hosts. If people were strategic, they did arguably better than in previous years as a host. Airbnb was able to continue floating through the pandemic with the help of this trend.
Airbnb has made an incredible comeback, and the travel business is again booming but in a different way. Because more people work from home and schools are available virtually, people can be away from home for extended periods of several weeks to several months. Airbnb has taught us a great deal. So many businesses have been waiting for things to go back to normal, but things may never be the same. If you want to succeed in this new era, you need to scale back, change your focus and become more flexible. In doing this, you will find even more success.