Airbnb (ABNB) is betting that a prolonged economic downturn will give the travel company tailwind to expand its pool of hosts to generate additional revenue.
In fact, CEO Brian Chesky said he’s already seeing a change in behavior on the platform reminiscent of the Great Recession when the company was founded.
“I think this is going to be similar to 2008 in a way,” Chesky told Yahoo Finance Live (video above). “A lot of people who haven’t thought about hosting are probably considering it now.”
That change prompted the San Francisco-based company to launch Airbnb Setup this week, a service that matches new hosts to Superhosts to provide customized guidance on how to list a home on the platform. The company also expanded its AirCover program to offer hosts more protection, including guest identity verification, reservation verification and $3 million in damage protection.
After spending the first half of the year fleshing out Airbnb properties himself, Chesky lists a room from his own San Francisco home on the platform to prove to users that hosting is neither risky nor challenging.
“I wanted to show people that if I can do it, they can do it, make it accessible in some way. And I thought it would be really fun,” Chesky said. “This is my real house. You live in a private room. You’re staying with me and my golden retriever Sophie.”
This marks a return to Airbnb’s origins. Launched in the depths of the financial crisis, Chesky and his co-founder Joe Gebbia listed their own properties as the first hosts on the platform.
Fourteen years later, Airbnb boasts more than four million hosts who have booked more than a million guests around the world. Chesky said interest in hosting has only accelerated with the economic downturn, as more people seek to earn extra income to help cushion the pain of rising living costs.
This year alone, more than 30 million people have visited the site to learn more about hosting options.
“If it weren’t for the Great Recession of 2008, I can’t say for sure Airbnb would have been successful,” he said. “But in a recession, people were willing to change their behavior. They are willing to do things they weren’t ready to do before the recession, such as: B. List their home and allow other people to enter.”
Keeping these offerings affordable is increasingly becoming a challenge, even as Airbnb strives to remain competitive with rival players in the hospitality industry. The average nightly price for an Airbnb stay is up 40% from pre-pandemic levels, with the average daily cost of a stay totaling $156 in Q2.
Chesky said supply shortages contributed to the price hike, along with a large increase in cleaning fee costs. Average cleaning fees for short-term rentals have increased nearly 30 percent in the past month compared to the same period in 2019, according to data from AirDNA.
To address these concerns, Airbnb made changes to improve transparency and chose to prioritize the total price travelers pay before taxes over the nightly price in its search ranking algorithm. Chesky said this allows the platform to rank “the highest quality homes with the best overall prices” higher in search results.
“Airbnb started out as an affordable alternative to a hotel. We must remain affordable, especially now that affordability is more important than ever in this economic climate,” he said.
Akiko Fujita is a presenter and reporter for Yahoo Finance. Follow her on Twitter @AkikoFujita