Airbnb Essay

1597 Words7 Pages
The enactment of the law comes as Japan aims to hit 40 million foreign visitors in 2020, the surge is attributed to the Marquee Olympic and Paralympic Games. The number of tourists has hit a record high for the 4th year straight, with 24 million in 2016 and approximately a sixth of them were accommodated by Airbnb. It is foreseeable that there will be an extreme shortage of hotel accommodations if the numbers continue growing at such rates, as hotel occupancy level is currently averaging above 80% in popular areas like Tokyo and Osaka. Fundamentally, the new ‘Minpaku’ regulations are in place to relieve the pressure on hotels and ryokan (traditional japanese inn) to meet the increasing demands. The rule which mandates a maximum of 180 days…show more content…
This forecast is partially due to Airbnb’s efforts to diversify its business model. AirBnb has introduced AirBnb Trip which consists of AirBnb Experience and Airbnb Places. AirBnb Experience allows you to book an experience hosted by a local which ranges from sports to entertainment to food. Airbnb Places allows locals to recommend local dining spots. The introduction of Airbnb Trips hopes to lessen the impact of the growth due to rental regulations and allows Airbnb to not rely solely on accommodation leasing but the whole experience. Additionally, Airbnb’s co-founder, Brian Chesky, hopes that the Airbnb Trips will make up at least half of its revenue in the future (Overfelt, 2017). These developments helps to balance out the growth of Airbnb in countries where the regulation is tight like in Singapore. It also further boosts the growth in countries where regulation is lax like in Japan. Airbnb is also currently looking to expand into the flight booking space to create an all-in-one booking experience for their consumers, from flight booking to itinerary.

Airbnb has also partnered with developers to build an apartment complex, which allows Airbnb to have a say in the architecture of the property to better suit the needs of travellers. Furthermore, the amenities and facilities will be allowed to use by the travellers as Airbnb can
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Rather, Airbnb can grow the overall pie and allow a to obtain a larger slice. As recognized by SF Travel, some cities may be prohibitively expensive for certain visitors, and hence price sensitive visitors would avoid travelling there. By providing affordable accommodations, Airbnb ensures that such tourists and attendees are not priced out. That lack of actual competition between Airbnb hosts and the hotel industry may explain why one study, focusing on the Texas market, projected that a one percent increase in Airbnb listings results in only a 0.05 percent decrease in hotel

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