Wednesday, 23 March 2016

Congratulations to EyeforTravel's Startup Village Winners!

As part of EyeforTravel's San Francisco Summit (March 14-15 2016), we teamed up with Amadeus and Travel Startups to showcase the best up-and-coming companies in the travel space. The day saw successful entrepreneurs and investors take to the stage to face questions from the eager startups, culminating in the pitches in the afternoon.

The Entrepreneur panel included:
  • Heddi Cundle, Founder, 
  • Jim Pickell, President,
  • Gadi Bashvitz, Founder & CEO, OLSET
  • Kerri Ann Zeil, Director, Amadeus for Startups 
  • Sara Margulis, CEO, HoneyFund

With the investor panel forming of:
  • Nancy Hayes, Managing Director, Golden Seeds
  • Saaed Amidi, CEO and Founder, Plug and Play Tech Center
  • George Arabian, Co-Founder & Managing Partner, Steelhead Ventures
  • Roopak Pati, Investment Banking Associate, Needham & Company

In the latter half of the day, startups ten had 10 minutes to pitch to our audience and our judges to be crowned the Startup of the Year. The judges marked each pitch on 7 criteria, including viability of the the company, uniqueness of the product and the innovativeness of the idea. 2016 turned out to be the closest year to date, with the top 4 being nearly indistinguishable, only separated by 2 or 3 points!

The 2016 runner up was Seatwizer, a service which allows users to compare like-for-like seats from competing airlines to see exactly what you are paying for and how you can get the most comfort for your money.

The winners of the day were the team at Grabr, the on-demand delivery service which allows users to get anything they want from anywhere in the world, delivered for by a traveller. The service has already delivered thousands of orders, and could be the best way to get your favourite items delivered from the USA, Europe and beyond!

Thank you to everyone who got involved with our Startup Village and the San Francisco Summit as a whole, we had a great time running the event and hope to see you next year!


Monday, 14 March 2016

Should hotels be worried about Airbnb's business travel plans?

The hospitality industry has been one of the most vocal opponents of Airbnb's unfettered expansion. Industry bodies have regularly pushed for for increased oversight and regulation. This is not without reason, as it now claims to have over 2 million listings worldwide. To put that in perspective, the new Marriott-Starwood merger has 1.1 million rooms in its global portfolio. However, to date one of the key advantages hotels had over Airbnb was the business travel market. Convenience, facilities along with security of location and payment helped to differentiate hotels and convince business travellers of their value. However, Airbnb has announced a major assault on this last redoubt, so should hotels be worried?

Well just in our office, two of my colleagues are staying with Airbnb during our San Francisco summits. On a less anecdotal level though, there seems to be some strong evidence that Airbnb is making inroads.  It has assumed an aggressive strategy, deepening its value proposition to business travellers with greater screening of listings, new search functions, and tools to make business travel easier to pay for and more accountable.

The end results seem to be an accelerating rate of growth. Certify, a travel expense software provider reported that US growth from Q1 2015 to Q2 was 143%. This has shot up to 261% growth in the US across the whole of 2015 and 249% internationally. Furthermore, they found that users were rating their stays higher on Airbnb than hotels.

A recent and comprehensive study from the University of Boston does give some hope though. It found that hotels with dedicated meeting and conference spaces were some of the least affected by the introduction of Airbnb. Overall, it found that in cities with at least 100 Airbnb listings, a "10% increase in Airbnb supply is associated with a statistically significant (p <0.01) price decrease of 0.19%." This may not seem a lot, but given Airbnb's growth, it quickly adds up. Hotels without meetings and conference spaces suffer a further fall in Average Daily Rate (ADR) when compared to hotels with these facilities. The paper calculates the loss at 0.15% per 10% expansion of Airbnb supply. If you haven't already read the study, you should definitely give it a read.

Given the lucrative nature of the business travel market, hotels should be concerned about this growth. However, business users are looking for a degree of reliability that Airbnb may never fully reach. Clearly, they also expect more facilities both in terms of convenience and comfort, with meeting and conference spaces creating a premium and also luxury hotels seeing the lowest negative effects from Airbnb. However, hotels will need to advertise these facilities better, maximise business loyalty rewards and pick up their game, particularly in terms of business guest satisfaction, to prevent haemorrhaging valuable business bookings.

You can hear directly from the Airbnb team at TDS Europe 2016, where James McClure, General Manager UK & Ireland, is speaking. This event is being held on 19-20 April in London. We also have presentations from Airbnb in our On Demand library.

Alex Hadwick

Head of Research, EyeforTravel