Airbnb’s unveiling
last week of the splashy “Icons” experiences and a slate of new tools for group
are both part of a much more fundamental element of the home-sharing
platform’s future plans: to get more people to create accounts in its platform,
including details about their personal preferences.

As Airbnb co-founder and CEO Brian Chesky explained to Wall
Street analysts in a call to discuss the company’s first quarter 2024 financial results, “Right
now, if you think of Airbnb as a solar system, the home is like the sun at
the center of the solar system. I think in the future, the profile will be the center
of the solar system of Airbnb, and the home will be one of many categories orbiting
the profile.”

The launches last week are both fueling that strategy. For
Icons, anyone who wants to apply to book one of the 11 pop-culture driven
experiences – with more scheduled to drop throughout 2024 – must create an
Airbnb profile. Chesky didn’t say how many people have already requested to
book the five that are currently available, but fair to assume it is quite a
lot given that he did say the launch has generated more than 8,100 pieces of
global media coverage and 371 million social media impressions. 

And then there are the new group travel tools. Chesky said
more than 80% of bookings on the platform are for trips of at least two people,
but traditionally only the person making the booking has a connected profile. Tools
announced last week are meant to inspire everyone participating in the stay to
create a profile so together they can review properties, communicate with hosts
and see check-in details.


We want to have a point of sale for every single person on the trip … not just a point of sale for the booker.

Brian Chesky – Airbnb

“It’s strategic for us to get more accounts … especially as
you want to sell more things beyond homes,” Chesky said.

“We want to have a point of sale for every single person on
the trip … not just a point of sale for the booker. … What we’re now doing is
we’re going to be investing a lot more in increasing our profiles and our
profile capabilities – our account structure, cleaning it up, our identity
verification, getting more people to complete more robust profiles, increasing
their preferences. So we have more information about people, and this is so
strategic because as trust goes up, you can unlock more things for people. And
as we know more about you, we can match you better.”

Chesky said these efforts to expand Airbnb beyond its core function
as a home-sharing platform, while the smallest of the company’s priorities in
terms of financial and human resources devoted to it, is where he and his
leadership team are spending the majority of their time.

“[We are] focused on transforming the company from an
accommodations business to a … multi-category company, and over the next three years
you’re going to see this play out quite substantially.”

And Chesky said the Icons products are intentionally
positioned as experiences, not stays, because they are part of the goal to
expand the company’s brand positioning beyond “just a place to stay.”

“Icons is like we’re a car company and we’re starting with a Formula
One car,” Chesky said. 

“And very few people can experience a Formula One car, but
it captures the magic, it captures the demand. It really expands the brand and
increases our permission to be able to go into experiences, and then you kind of
move down market. And one of our goals is going to be to bring the magic of Icons
to everyone. … We’ve really paved the way for next year.”

International growth and improving the core

Last week’s launch event also tied into another of Airbnb’s priorities –
international expansion. As it hosted more than 150 journalists and influencers
from around the world at the one-day event in Los Angeles, Airbnb was investing
in brand awareness in countries such as Mexico, Brazil, Germany, India, China,
Japan and Korea – some of the 220 countries where the company operates and which
Chesky said are key priorities for growth.

“A lot of these other markets … are huge travel TAMS
[total addressable markets], especially in Asia,” he said.


[We are] focused on transforming the company from an accommodations business to a … multi-category company, and over the next three years you’re going to see this play out quite substantially.

Brian Chesky – Airbnb

“And one of the things that we’ve learned is that Airbnb pretty
much resonates pretty equally everywhere once there is the awareness. … So I’m
very, very bullish about that.” 

A third priority for the company relates to perfecting its
core business. Chesky said he believes the company is “just scratching the
surface” in its ability to improve three things: the quality and reliability of
its products; the affordability of what it offers compared with competitors; and the
usability of its platform.

One notable metric that speaks to progress in terms of user
experience is the fact that Airbnb’s app downloads in the United States
increases 60% in Q1 compared with the same period a year ago, and global nights
booked through the app increased 21% year over year, to 54% of total nights booked
in the quarter, up from 49% in Q1 2023.

Chesky noted that conversion rates on native apps are
typically much higher than on a mobile website. In addition, improvements that
have been made to user interface such as better filters and a more prominent search
box have “over the last year, last 12 months, we’ve likely driven at least a
few hundred basis points of incremental growth just through optimization of the
search flow,” he said.

Financial results

While it remains to be seen what
impact Icons has on the company’s bottom line – there’s speculation
across the industry it won’t be much
and Chesky himself acknowledged it is
a brand investment – Airbnb’s Q1 results show momentum in the home sharing
platform’s growth.

Revenue in the first quarter hit $2.14
billion, up 18% year over year, while adjusted EBITDA of $424 million represented
a 20% adjusted EBITDA margin, up six percentage points from the prior year.

Nights and experiences booked in the first
quarter of this year grew to 133 million, up 9.5% year over year, with growth reported
in all regions of the world. Compared with the same quarter in
2023, active listings for accommodations – excluding thousands of properties that
Airbnb removed for low quality – grew 17%.

The company said the highest growth in inventory
came in Asia Pacific and Latin America, regions that also had the highest
year-over-year growth in nights and experiences booked.

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