Industry Update
Opinion Article25 January 2016

Beating Airbnb with the “Experience Economy”

By Babs Harrison, Managing director of Phoenix based Babs Harrison and Partners

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The inescapable, wrenching news: Airbnb (and of course fellow travelers like Homeaway) continue to grab room nights and they are getting ever more clever about how they do it.


Who wasn't dazzled by Airbnb's round-up of special Valentine's Day stays? That's marketing you have to salute.

Hoteliers need to fight back.

Some need to wake up and smell the coffee, as "Dear Abby" used to write in response to especially obtuse letter writers. That is the phrase that pops into mind when I hear from a hotelier, "We haven't seen any impacts yet."

Stick with that happy thought until you wake up in a foreclosure sale.

The rest of us know that now is the time to get real about how we plan to counteract the sharing economy lodgings offerings which, in many cases, offer much more space, a full kitchen, possibly a yard and a private pool.

All this came into a sharper focus as I recently read about Elizabeth Pizzinato's recent stay in Stockholm. She is a senior vice president at Four Seasons - which h

as no Stockholm property - so where did she stay? At an Airbnb property because she got twice the space for half the price of high end hotels in the Swedish capital.

Said Pizzinato at Luxury FirstLook: Strategy 2016: "I've been obsessing about a new word, and it's particularly true in my industry hospitality, 'disruption.' And Airbnb is disrupting the travel industry."


But Pizzinato is not despairing. Instead she offered up a battle plan that mixes in elements of the "experience economy" - where experiences are the new luxury guests covet - and she also said that Four Seasons is working to "further focus on what matters to our guests and be singular in that focus."

I have written before about how to beat Airbnb.

But thinking about the "experience economy" lets us take the fight to a new level and it is a fight we can - and must - win.

Book a stay in an Airbnb property and usually what do you get: a key.

What we can do at clever resorts is facilitate magical experiences. Like what? I am now working with an intimate scale resort in Paradise Valley, AZ where, increasingly, we are doubling down on experiences that center on art because art is central to our history and who we are. Not every hotel could do this - the arts might seem a desperate and insincere grab. But for us, this is in our DNA.

How would a guest like a private tour - a meet and greet - with a local artist in his/her studio? For the right guest this could be a powerful experience and we are in a position to offer it. Our size helps too. Many local artists would welcome the occasional visitor but they don't want to hold regular and extended office hours.

Those are experiences that can't be offered by an Airbnb (or by most competitive resorts for that matter).

Pizzinato added more insight on what we can do - that Airbnb likely won't - and that is to creatively stoke the guest's anticipation of the experience. Why? Some research shows that for many of us the anticipation is more delightful than the actual experience, which is not to belittle the experience. It's just that our dreamy anticipation is just about perfect. We have the marketing smarts to fuel the guest's anticipation. Do it. Knowing that the sharing economy players aren't.

Another advantage a hotel has over Airbnb: We know our guests. Does Airbnb have insight into who its customers are? Of course. But that insight rarely will filter down into who are the guests for this particular home in Sedona or apartment in the Haight.

A hotelier has to know and that means redoubling efforts to sift through data in a journey of guest discovery. Don't say "we know our guests," not unless you have recently engaged in a detailed voyage of discovery into your guest data.

Do all this and will you win?

Understand: the sharing economy players are not going away. Howls of pain are growing in volume at the American Hotel & Lodging Association. It won't matter much because Airbnb, et. al. are going nowhere. They are in our competitive set.

And we can beat them. Know our guests. Focus on what the guests really want. Deliver genuine experiences. And stick with a sincere marketing platform that is free of disingenuous hyperbole.

What could be simpler, really?

But that is exactly how to win.

Related News

CBRE Hotels’ Americas research estimates Airbnb users spent $2.4 billion on lodging in the U.S. over the past year

2 February 2016 — Airbnb's presence in key markets throughout the U.S. is growing at a rapid pace, with users spending $2.4 billion on lodging in the U.S. over the past year, according to analysis from CBRE Hotels' Americas Research.
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