February 03rd, 2015

Last year, Airbnb refused to attend the International Hotel Investment Forum (IHIF), the foremost international hotel industry conference, held annually during the first week of March in Berlin. This year however, Chip Conley, Airbnb’s Head of Global Hospitality & Strategy, has agreed to come and will face off with Starwood Hotels and Resorts’ CEO, Frits van Paasschen, in a session entitled, “The World is Changing – It Is Ours To Win Or Lose”, which will take place on Monday 2 March, the first day of the 3-day event. Interestingly, Chip Conley is a hotelier by trade and was one of the originators of the boutique hotel concept when he founded Joie de Vivre in California in 1987. Conley subsequently grew the chain to 35 properties and then sold it 2010.

Airbnb brought him on board in September 2013 in an effort to install some uniformity and quality standards into the group’s lodging product. Conley has instituted an online training programme to train hosts through online webinars and is focusing on nine standards for all Airbnb hosts, such as cleanliness, response time to travellers on the site, and accuracy of listings. “I’m a big believer in the best thing to do to manage the expectations of guests is to create standards. That’s things that guests can count on–like soap.” Other standards include fresh linens on the bed, towels, and toilet paper. These are basic things that will make all Airbnb’s meet basic minimum expectations for travellers. The idea is not to make Airbnb properties like hotels. In fact, Conley says Airbnb properties are popular because of their focus on personalisation and uniquely local experiences. ”We want hosts to understand that the more we create unique experiences and the more localised experience it is, the more we meet the needs of guests,” says Conley.

In contrast, Frits van Paasschen did not have a hotel background when he joined Starwood as CEO in 2007 from the beer industry. In a way, pairing Airbnb with Starwood avoids some potential conflict, since the chain operates primarily upscale and luxury hotels (under brands such as Sheraton, Westin, W and St Regis) catering to frequent business travellers. Hence it is unlikely that Airbnb is a serious competitor as yet. However, Accor’s new CEO, Sébastien Bazin, labelled such platforms as ‘disruptors’ at a press conference held in October 2014. Admittedly the challenge of the peer-to-peer phenomenon in lodging should not be taken lightly and Accor with its primarily budget and midscale offerings is probably more vulnerable to the inroads of an Airbnb. Nevertheless, for the time being the threat seems largely confined to the minority leisure segment of most chains. Probably the apartment rental platforms are creating a new market for travellers who would not have stayed in paid accommodation previously, a bit like what occurred when budget airlines first appeared on the scene. Now, however, both easyjet and Ryanair are making a bid for the legacy carrier’s core business traveller market. Could this happen in the lodging sector?