Morgan Stanley research suggests slowdown in growth for Airbnb

Morgan Stanley research suggests slowdown in growth for Airbnb

Awareness in core US and UK markets ‘plateauing’ suggests financial services giant Continue reading

Evidence that fast-growing hospitality disruptor Airbnb may be topping out in terms of growth has emerged in research from Morgan Stanley.

Although far from going into reverse, the financial services giant, suggests awareness in Airbnb’s core US and UK markets is plateauing.

Morgan Stanley’s AlphaWise survey of 4,000 people in the US, UK, France and Germany found the peer-to-peer platform was used by 25% of travellers in the last 12 months.

This equated to a relatively impressive increase of 3.3 percentage points, but compared unfavourably to the 7.9 percentage points achieved in the previous 12 month period.

At its height in 2016 Airbnb’s awareness was growing by up to 20 percentage points.

Morgan Stanley’s research found the growth slowdown was being felt both among Airbnb’s leisure and corporate customers.

Airbnb will grow its corporate business by 20% in 2017, under the 23% it forecast but ahead of the 18% it achieved in 2016.

Morgan Stanley noted a rise in the number of people expressing concerns about safety and security had risen from 10% in 2016 to 25% this year.

Among non-Airbnb users 36% said they were concerned about privacy, up seven percentage points, and 13% were worried about security, a rise of 4 percentage points.

Morgan Stanley’s report said: “This is surprising and potentially troubling for Airbnb’s growth, typically, consumers become more comfortable with emerging technologies as awareness/testing/adoption grow. This doesn’t appear to be happening for Airbnb.”

And the analyst predicted OTAs will emerge as the main beneficiaries of a slowdown of Airbnb.

“If anything, we see the OTAs’ strong use trends, paid search/traffic acquisition expertise and improving inventory offering (more alternative accommodations) becoming a growing threat to Airbnb, as the OTAs, in our view, are better positioned to act as the online travel one-stop shop,” the report said.

Morgan Stanley revised its forecast for user adoption down from 31% to 28% for 2018, from 37% to 30% for 2019 and from 43% to 31% for 2020.