New research from Morgan Stanley suggests the pace of growth
of Airbnb use is slowing in the U.S. and Europe. In its third annual AlphaWise
survey, the firm found that the share of travelers who used Airbnb during the
past 12 months rose to 25 percent, an increase of 300 basis points, which is
lower than the prior year's growth of 800 basis points.
Morgan Stanley attributes the tempered growth to a plateau
in awareness of Airbnb; awareness of the platform from online consumers is at
80 percent across the U.S., the U.K., Germany and France, and the 800-basis-point
year-over-year growth in awareness is significantly lower than the 2,000-basis-point
spike noted in 2016. "Awareness-driven
adoption can only go so far among this demographic in these countries,"
the report stated. Morgan Stanley found that the slowing growth applies to both
leisure and business travelers. The firm had expected business travel adoption
to increase from 18 percent in 2016 to 23 percent in 2017. Instead it grew to
only 20 percent.
At the same time, worries about Airbnb guests' safety and
security are on the rise; the number of people concerned about such issues rose
from 10 percent in 2016 to 25 percent in 2017. Additionally, the percent of
non-Airbnb users who cited concerns about privacy grew to 36 percent, up 700
basis points, and non-users worried about security grew to 13 percent, up 400
basis points. "This is surprising and potentially troubling for Airbnb's
growth," the report stated. "Typically, consumers become more
comfortable with emerging technologies as awareness/testing/adoption grow. This
doesn't appear to be happening for Airbnb."
Morgan Stanley has revised its forecast for user adoption down
from 31 percent to 28 percent for 2018, from 37 percent to 30 percent for 2019
and from 43 percent to 31 percent for 2020. These results could prove to be a
boon for the hotel industry, which has seen weaker pricing power during the
current cycle than in other historical periods. A previous Morgan
Stanley report suggested Airbnb was to blame for fewer compression nights
at hotels in 2016.
However, the report also suggests that online travel
agencies will be the real winners in all this: "If anything, we see the
OTAs' strong use trends, paid search/traffic acquisition expertise and
improving inventory offering (more alternative accommodations) becoming a
growing threat to Airbnb, as the OTAs, in our view, are better positioned to
act as the online travel one-stop shop."
The report, titled "Surprising Airbnb
Adoption Slowdown in US/EU, and What It Means for Hotels and OTAs," is
based on a survey of approximately 4,000 consumers aged 18 and older in the U.S.
and Europe. The survey was conducted from October 2016 to November 2017.