Airbnb has announced a major revamp of its home-sharing platform to address mounting tensions between guests and hosts. The changes aim to improve price transparency, checkout procedures, affordability, and more. The company has listened to feedback from millions of customer service tickets, tens of thousands of social media posts, and hundreds of thousands of hosts and guests, to create more than 50 new features and upgrades. Airbnb's CEO, Brian Chesky, spent six months living in Airbnbs and another six months hosting people to experience both sides of the issues. Chesky said that last summer was "a bit of a wake-up call" as he started noticing more complaints on social media. The company's brand is so big and mainstream that people now expect it to work every single time.
Airbnb now has over 4 million hosts who have welcomed 1.4 billion guests in dwellings from tree houses to mansions around the globe. The company has long struggled with how to balance these two sometimes opposing pillars of its business. After being gutted initially by pandemic lockdowns, Airbnb has boomed in the work-from-home era and has benefitted from pent-up demand for travel. It expects more than 300 million guest arrivals on Airbnb this year.
The Covid-19 pandemic changed expectations on sanitation and cleanliness, and a surge in demand led to a rise in prices. By late last year, there was a groundswell of anger from longtime users who complained about lengthy lists of chores and exorbitant cleaning fees. Part of the problem stemmed from the app's design. Chesky said that "hosts were charging excessively high cleaning fees because they didn't realize what the guest was really paying." Airbnb has fixed pricing by calling on its design department and 20 different teams. The result is a system that allows guests to view the total cost, including all fees before taxes, across the entire app. Hosts will also have new tools to set competitive prices, add discounts, and compare their listing to similar ones in their area.
To make Airbnb more affordable for guests, the company is implementing a series of changes including lower fees, adding the ability to pay in installments through a new partnership with Klarna Bank AB, and a new discount tool for hosts to offer the best deals. Keeping prices in check on Airbnb is a core mission of the company, as it speaks to one of the main reasons Chesky started it with two friends in 2007.
Airbnb is also going back to its "soul" with Airbnb Rooms, an effort to attract the young travelers that Chesky said the platform hasn't invested enough in over recent years. The Rooms category will have more than 1 million listings with an average rate of $67 per night, where guests will stay together with hosts, sharing common spaces such as the kitchen, living room, bathroom, or backyard. A Host Passport will give guests details about the person they're staying with, including their photo, social interaction preferences, and fun facts about themselves.
Chesky said that getting pricing right is important as the inflation rate is rising, squeezing consumers' wallets, while airline prices are expensive. He said those elements will have an impact on travel this summer. Chesky also described the unique complications of managing a two-way platform as being ripe for disruption by artificial intelligence. He said Airbnb is exploring ways to use the technology to augment customer service and provide better matching between hosts and guests. However, before launching new innovations with AI, the company needs to fix existing problems first. Chesky said that he wanted to make sure that people love the core thing that Airbnb does before exploring new things.