A Signature Media Publication
Tune2Protect

Airbnb launches a flexible payment option

Airbnb in a bid to make group travel seamless is offering guests a flexible payment option – pay less up front. Guests can now easily split payments with friends or family.

Prior to this initiative, Airbnb guests paid for 100% of the trip at the time of booking. With the new option, guests can pay for part of the trip at the time of booking – a 50% deposit in most cases – and pay the rest closer to check-in date.

In the testing of ‘pay less up front’, the company saw a clear demand for more convenient payments: Given the option of paying less up front, 40% of guests chose to do so, and opted for higher-value bookings on the whole. It was also found that the new initiative encourages bookings further in advance: Compared with ordinary bookings, the Pay Less Up Front payment option led to bookings with nearly double the lead time, helping hosts to secure and manage bookings more easily.

The new payment option is available on all platforms of iOS, Android, mobile web, and desktop.

Airbnb gains traction in Dubai

A recent market report conducted by Chestertons MENA outlined the growth of Airbnb in Dubai between August 2015 and August 2017.

As per the report, revenues for properties listed on the online marketplace and hospitality platform increased by 421% for that period to top US$3.3million in August 2017, with listings nearly tripling to 3,249.

The increase can be attributed to relaxation of rules, effectively making it possible for homeowners and tenants to cut out the middleman and list their property directly on the site. The growth has been 161% from 1,241 units in August 2015 to 3,249 units in August 2017.

Interestingly, the report suggests that rather than competing with Dubai’s hospitality sector, the Airbnb concept is complementing hotel offering by providing an alternative travel experience, with average occupancy levels touching 57% during Dubai’s peak season. During low season months of June, July and August 2017,  Airbnb occupancy levels averaged nearly 40% – on a par with performance in the hotel industry.

Average Daily Rates (ADR) for listings have retained consistent year-on-year levels with prices in August 2015 averaging US$153; in August 2016 prices averaged US$154, and in August 2017 the price was US$154. The first three months of 2017, denoting peak tourism season, witnessed ADR of US$226, US$201 and US$204 respectively, further underscoring the popularity of the community-driven hospitality platform.

Since its inception in 2008, the company has assisted over 200 million guests in more than 65,000 cities and 191 countries.