Barron’s – For Hotels, the Airbnb Threat Could Be Receding

Airbnb’s user growth is slowing, according to a recent survey, and that’s good news for both hotel chains and online travel companies alike.

A quarter of travelers used Airbnb in the last year, a Morgan Stanley survey found, up from 22% a year ago and 14% a year before that. With 80% of consumers in the U.S. and E.U. already aware of Airbnb, Morgan Stanley’s Brian Nowak thinks the company has largely tapped out the easy growth. With the novelty gone, Airbnb needs new ways to drive usage.

Another obstacle for Airbnb is that travelers are still concerned about privacy and safety issues in regards to the service. This year, survey respondents who hadn’t used Airbnb were more likely to cite safety and privacy concerns than they were a year earlier.


“A slowing user adoption curve suggests Airbnb is less of a threat to hotels,” Nowak writes. As a result of the survey findings, Morgan Stanley upped its growth estimates for hotel industry “revenue per available room,” a key industry metric. The firm is most optimistic about Marriott and Hilton and has Overweight ratings on both stocks.

Morgan Stanley’s survey also found that usage rates for online travel agencies — companies like Expedia and Priceline — were on the rise in the last year, a sign that Airbnb’s popularity isn’t crimping demand for these services. The major online travel sites have done a good job of branching into non-hotel lodging options, such as apartments and chalets, Nowak notes. Expedia, for one, is seeing success with its HomeAway platform, which helps travelers find vacation rentals.