Airbnb’s acquisition of HotelTonight helps grow the platform’s end-to-end vision

July 15, 2019, 2:00 PM GMT+0

[This analysis is a part of a larger YouGov report on the role of technologies in the travel industry. Download the full, free report here.]

Airbnb is typically associated with homes for rent. The platform connects home hosts or people who list a room, apartment, or houses with travelers that want to rent lodging. But with its recent agreement to acquire HotelTonight, the move adds boutique hotels to Airbnb’s inventory of unique accommodations and helps in addressing the uptick of same-day bookings, which Airbnb notes as growing year over year. Ultimately, the acquisition signals that the brand remains true to its vision—serve every guest. 

HotelTonight got its start in 2010 as a niche travel agency. It was online-only, mobile-only, and focused on getting travelers a last-minute hotel deal. That mobile-first strategy eventually paid dividends.

Today, HotelTonight operates both a mobile app and website. Its niche focus has transformed into a competitive difference: the ability to accommodate the last-minute traveler. That capability plays right into Airbnb’s vision to serve every guest.

A travel brand’s success often hinges on customer satisfaction, especially in a world where you can leave a review on just about anything. According to YouGov BrandIndex data, HotelTonight customers express some of the highest rates of Satisfaction when compared with customers of other prominent booking agencies.

At its highest, Satisfaction among HotelTonight customers reached a score of +71 in November 2018. That particular score was recorded a month after HotelTonight launched its desktop site, which ended the company’s mobile-only strategy.

What type of hotel guest is Airbnb acquiring?

Airbnb could inherit a distinct group of travelers because of this recent agreement. According to data from YouGov Profiles, those considering booking through HotelTonight are more likely to be Millennials (48% vs. 26% of those in the market for a hotel room), parents of children under the age of 18 (38% vs. 31%), and traveling for both work and leisure (44% vs. 36%) when compared with individuals that say they are in the market for a hotel room over the next year.

That last finding may be a point of interest to Airbnb, especially since those considering the company are traveling strictly for leisure (47% vs. 34% of people considering HotelTonight). This suggests that along with an inventory of boutique hotels, the acquisition brings with it a share of bleisure travelers.

Those considering HotelTonight also hold some distinct consumer preferences. This group is more likely than those who indicate they are in the market for a hotel to say that the hotel should be easy to reach (54% vs. 34%), have leisure activities nearby (41% vs. 27%), and have online reviews (44% vs. 33%). This group is also more flexible in their demands on hotel brands, as they are less likely to be impacted by price and cleanliness when compared to those in the market for a hotel room.

Two more pieces in the end-to-end puzzle

Airbnb’s decision to acquire HotelTonight is an effort at brand building. Now, Airbnb can meet the needs of the last-minute traveler as well as offer a unique inventory of discount and boutique hotels that might not have received a mobile platform and presence without HotelTonight. These trendy, boutique hotels complement the new Airbnb Luxe offering and serve to add diversity in its accommodations portfolio before its much anticipated initial public offering.

A final note on reaching the luxury traveler: A recent report from YouGov Affluent Perspective proves the demand for rentals is high on a global level.  And while the market is clearly primed for this product, service remains king with luxury travelers.  Executing on the add-ons will be the key challenge for continued growth. 

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