Vacation Rental Consultants > A few thoughts on Airbnb’s long term strategy

Is Airbnb silently and strategically moving from a channel to a siloed, fully controlled marketplace, where capital value is hard to build for managers and hosts, capturing new businesses like a flytrap and moderating longer-term connected PMC opportunities?

This is a long article! Please feel free to read the summary at the end!

 

 

What came first?

What came first, vacation rentals or Airbnb? The answer depends on who you ask, of course. Those born before the end of the last century may recognise a decades-old industry, while the younger consumer may think it’s a brand new concept in a world ruled by Airbnb. Increasingly, we see online narratives where Airbnb aficionados decry traditional management, and Airbnb appears to be driving this message through its technical, marketing, and business modelling.

 

Airbnb has a strong brand name (and millions of properties and hosts), one of its main drivers for success. The other is its process and continual transition from host love to guest adoration to increasing supply controls, all supported by substantial guest data.

Have you caught the bug? Do you need to wean yourself from the habit-forming drug through a more distributed marketing plan, or do you want to continue with the status quo, which may one day become a health hazard and hard to shake? Do you want to build business value?

This article will not reiterate how Airbnb started, its largely untrue “sharing” model, the excellent PR department, or Brian Chesky’s now old story. We are concentrating on Airbnb’s development of an aggregated and siloed ecosystem, with a primary responsibility to shareholders (not hosts). All public companies have this, but we must address their approach and the supply narrative.

The company’s responsibility to shareholders is to increase the share price and pay dividends. As the graph below shows, things are not great in that camp. The only way to improve this long term is through growth and profitability, focusing increasingly on the consumer, controlling the hosts, and expanding its footprint.

 

Despite its brand and volume of properties, Airbnb is in an accommodation arms race, as this chart from Key Data Dashboard from last September shows.

 

Key Data 2024

How will Airbnb achieve this, and how has its journey allowed it to manoeuvre into a more aligned growth strategy? Will it work?

 

In the context of this article:

 

      • Co-host is an Airbnb term for any host who works exclusively within the Airbnb system to share a property and divest control of certain aspects to another host, such as property management, guest liaison, pricing, maintenance, etc. The co-host is essentially a contractor to the host, who has oversight and control.


    • A manager/agency outside the Airbnb system may use technology to connect with multiple channels, engage in direct bookings, employ cleaners and support roles, or subcontract various elements. A manager or agency will contract with the owner with agreed terms and duration outside a marketing platform and endeavour to build a brand.

 

 

2025 Summer Release

The latest release (13th May) brings experiences back into the spotlight and “services”; the promoted list is below. Still, the app developments are the most interesting element of the release, as it moves toward a social platform for group experiences combined with a self-managed travel itinerary. It is embedding information supplied by third-party tech businesses, which is currently under threat as forcing guests to download other apps or tools is banned under their “off-platform” rules.

App downloads are an essential part of all big travel businesses, assisting in reducing search spend and increasing spend opportunity. The Airbnb app is central to the success of its recent news and focus. As the US is Airbnb’s biggest market, the stats below show the percentage of downloads across this vertical.

 

The focus on experiences and services is on incremental income and guest data. Still, as Airbnb has discovered, it is hard to embed micro business services in the booking flow or as a secondary opportunity. The update also lacks answers on liabilities and their attitude to poor service. Time will tell, but if you have a spare 50 minutes, then watch the launch video. Of course, it’s all gloss, wonder, and the same early stories. No audience questions!

 

      • SERVICES


      • Chefs – Fully customisable in-home meals from professional chefs.


      • Photography – Personalised photo sessions from experienced photographers.


      • Massage – Restorative massages, including Swedish, deep tissue, and reflexology from experienced therapists.


      • Spa treatments – Facials, microdermabrasion, body scrubs, and other therapies, provided by professional aestheticians.


      • Personal training – Yoga, strength training, HIIT, and more, led by personal trainers, including renowned fitness professionals and world-champion athletes.


      • Hair – Professional haircuts, blowouts, and more from experienced stylists.


      • Makeup – Makeup is made for everyday or special occasions by professional makeup artists.


      • Nails – Manicures and pedicures from experienced nail specialists.


      • Prepared meals – Ready-to-eat meals prepared by professional chefs.


    • Catering – Full-service catering with custom menus, decor, equipment, setup, and cleanup.

Managers often upsell some of these experiences and services, which will no doubt increase conflict and may be subject to Airbnb’s terms and conditions on what a host may offer directly to a guest. We will address this in more detail as the months pass, but consider this move and relaunch of experiences in the context of co-hosting and unique Airbnb hosts, compared to traditional full-service, multi-channel managers. In addition, this extension of its offerings should be considered in the context of three of Airbnb’s conditions related to guest information.

Prohibited Practices:

 

      • Misuse of guest contact or identity info


      • Diverting reviews off-platform


    • Requiring other apps or websites for access

Ref: https://www.airbnb.co.uk/help/article/2799#section-heading-5

 

 

2025 Airbnb Headwinds

This industry caught a cold a long time ago as it scaled at an alarming rate. Most recently, Airbnb has been called out on almost 66,000 properties in Spain for its hosts not being considered legal operators or demonstrating they are through license number presentation. The published press on tourism and housing shortages will have amplified the opportunity and potentially driven these demands. This substantial income driver has been published as between 12% and 15% of Spain’s Airbnb inventory and would make a serious dent in its bottom line.

Booking.com was also recently instructed to reduce hotel commission in Switzerland, which indicates the OTA’s power. At what point does any OTA fall into the “Abuse of a dominant position” argument?

These demands are being challenged, but it is a sign that not all is well in the corporate accommodation booking business, and this negative press and online inventory inspection may well gain momentum.

However, any reduction in inventory means that demand has fewer choices, and hence, any challenged business must try to control supply and demand.

 

 

Caught our eye

There has been much press on these changes, and we will no doubt see a vast amount more over the next few months, but these few lines from Humphrey Bowles illustrate and underpin the strategic objectives we are focused on. Deliberate or not, it is about shareholder value.

 

 

So we asked Humphrey for a quote!

“Airbnb’s latest update reveals the essence of digital sharecropping: they’re now monetising hosts’ properties through third-party services (automatically opted-in) while keeping 100% of revenue.
Hosts provide the physical space, maintenance, and assume liability risks while Airbnb extracts additional value without compensation. Most tellingly, hosts can’t offer their own services—only “recommend” Airbnb’s approved providers.

This isn’t enhancing guest experience; it’s controlling who profits from it. When platforms unilaterally decide how to use your property without compensation, you’re not a business partner—you’re property inventory and you are the employee.”

This is supported by a masterclass explanation of the sand shifting under traditional, asset management, hospitality-focused businesses. It is well worth watching and supports the summary hypothesis that the Airbnb game plan is dangerous to fully pledged management companies with a high dependence on Airbnb. We have added the video at the end of this document.

 

 

Numbers Count!

Analysing Airbnb’s key performance indicators over time provides a quantitative view of its growth, operational scale, and financial health. It also highlights essential nuances in how metrics are defined and interpreted.

Listing Definition: “Active Listing” is generally defined as a listing visible on the platform that has historically had at least one booked night or reserved calendar day within a specific reporting period. In contrast, an “Available Listing” is an active listing with calendar availability or at least one booked day within the current reporting month.  This distinction is critical because a drop in “Available” listings might be temporary (e.g., owner blocked calendar, listing snoozed). In contrast, a significant drop in “Active” listings is more indicative of properties leaving the platform or the STR market altogether.

Inventory Growth and Composition

Airbnb’s listing inventory has seen dramatic growth, albeit with some fluctuations: From its early days stage with roughly 2,500 listings in March 2009, it hit 7 million by 2019. The pandemic caused a significant dip, with reported listings falling to just over 5 million in 2020.  Recovery followed, with numbers climbing back to 8 million by 2024. Note, 8m is not the bookable/active or available listing number, and data varies depending on the sources! AirDNA recently presented the figures below, showing 6m active and available listings representing a tangible volume of properties.

Regardless of these numbers, it is a vast collection of independent hosts, with many fewer professional managers, representing a substantial portion of the income.

 

Image: AirDNA

User Base: The number of active users was reported at 150 million in 2018 and 200 million in 2020, with estimates suggesting it reached approximately 275 million by 2024. The platform has seen over 2 billion cumulative guest arrivals since its founding (2024 FY report).

Note: Minor discrepancies exist between data sources regarding exact numbers and timing.

Regional and Property Type Mix: 

Historically, Europe represents the largest region by listing count, followed by Asia Pacific and North America. The United States consistently holds the most significant listings for a single country. Major global cities like London and Paris have traditionally boasted the highest urban listing concentrations. The composition shifted significantly from primarily shared spaces in the early days to a predominance of entire homes and apartments (despite the press, which often used a shared home narrative and indicated the absence of industry knowledge and deliberate PR management).

The platform now markets a growing number of unique stays (treehouses, yurts, etc.), and recent data suggests hosts managing only one unit represent the fastest-growing supply segment.

Booking Volume and Value

The night booked growth has been exponential from early milestones: 1 million (2011), reaching 491 million in 2024 and reporting more than 100 million in the first quarter of 2022.

Gross Booking Value (GBV): This represents the total dollar value of all transactions on the platform, including the host payout, service fees (host and guest), cleaning fees, and any taxes Airbnb collects. GBV grew from $20.9 billion in 2017 to $81.8 billion in 2024, with a slump during COVID-19.

 

Airbnb-growth

Average Daily Rate (ADR):

ADR have been on the rise and attributed to factors like a shift towards larger properties, travel to less urban destinations, accelerated by Covid, which have different pricing structures, general inflation, and conscious pricing strategies by hosts. ADR saw substantial increases; for instance, Q1 2022 ADR was reported at $159.82, a 31% increase compared to Q1 2019, but seasonally adjusted has ranged between $137 and $171 (Q1 2025). More recently, ADR increases have been described as “modest” (Q4 2024) 94, suggesting stabilisation after the post-pandemic surge. We also need to understand that dynamic pricing and commission uplifts have elevated ADRS, and guests are paying more through OTA platform modelling.

Nights and Experiences Booked accelerated in Q4 2024 to 12%, making it the highest year-over-year growth quarter. Revenue also grew 12% year-over-year to $2.5 billion in Q4. The net income was $461 million, the adjusted EBITDA was $765 million, and over 5 million hosts were announced in Q1 2025.

Host Economics

Public communications often cite figures such as “$14,000” as the approximate supplemental income earned by the “typical” US host in 2022 and 2023. These are overall numbers and do not represent management companies and all properties.

These averages obscure wide variations in actual host earnings. Factors influencing income potential include property location, property type, size, offered amenities, pricing tiers, seasonality, local competition, and the amount of time the property is made available.

Motivation and Reliance: Surveys indicate many hosts rely on Airbnb income to cover essential expenses e.g. mortgages, food, and other rising costs. Some report it helped them avoid eviction or foreclosure. Around 45% of hosts surveyed felt STR income was instrumental in meeting their financial needs.

Superhost Premium: Achieving Superhost status is correlated with significantly higher earnings, reportedly 64% more on average than regular hosts, and the recent “Guest Favourite” accolade will add more traction to those who are commended.

 

 

Brand Strength & Inventory:

A remarkably high percentage of website traffic originates from direct or unpaid channels (estimated at 91% in the S-1 filings), indicating strong brand recognition and reduced dependency on paid search compared to competitors.

Repeat Business: A significant portion of revenue comes from repeat guests (69% in 2019), suggesting strong customer loyalty despite lacking a formal points-based loyalty program. Host retention is also high, with 84% of 2019 revenue reportedly coming from hosts active in the prior year.

Airbnb makes a big noise about smaller hosts getting better reviews, so how many are there? Almost 70% have less than five properties/units, and nearly 40% have only one.

Split of inventory size (AirDNA data)

 

split-airbnbs

Importance of larger inventory management businesses

21 Units is a “measuring stick” for what could be considered “professional managers,” although it is generally recognised as a higher number than this. However, this represents 850K properties on Airbnb. There is a strong likelihood that these properties will be available for a high percentage of the year and will, therefore, generate a higher income than the part-time hosts. These businesses are much more likely to list on multiple sites.

 

Airbnb Income - envelope

Back of an envelope (means it could be wildy wrong, but these numbers are not published), averaging $116 per night on 60% occupancy and 50% of the bookings made on Airbnb (others are direct/Booking/Expedia, etc. but these are likely a high proportion of Airbnb loyal businesses) will generate an income of over $1.8bn (based on 11 bn GBV) on the 21+ properties segment, a not insubstantial number and 13.5% of its 81bn GBV in 2024).  Therefore, this segment is significant to Airbnb and is a single customer subset, not 20 individuals, and probably less support-dependent.

If the managers did not distribute more widely and mix their marketing, Airbnb could double its revenue from this segment. Consider the co-hosting model in this context, and now upsells or experiences and services.

 

 

Management of (your) Money

This is an increasingly interesting environment for all OTAS, platforms and PMSs to invest in. A payment system for guests and hosts is one cornerstone of Airbnb’s success as a payment intermediary.

Airbnb collects payment from the guest when a reservation is confirmed. These funds are held in “escrow” and are typically released to the host approximately 24 hours after the guest’s scheduled check-in time, with variations on more extended stays, new accounts and disputes. Monies can arrive between 24 and 48 hours.

This payment approach serves multiple purposes:

 

      • It builds trust by assuring guests their payment is secure until they successfully check in, protects hosts against last-minute payment issues, and allows Airbnb to manage disputes and refunds more effectively.


      • This “Service-Oriented Architecture (SOA) system” is a critical operational asset, enabling secure and efficient transactions worldwide and providing Airbnb with significant operational float—the interest earned on funds held between guest payment and host payout.


    • Split payments are allowed in the co-host environment. Similarly, guest group payments were initially allowed but discontinued in 2018.

Commissions: Airbnb’s revenue model relies on charging service fees on bookings. The structure of these fees has evolved, with significant implications, particularly for different types of hosts.

On Day 1. Split-Fee Model: 

For years, the most common structure involved charging fees to both parties. Hosts typically paid a service fee of around 3% of the booking subtotal. Guests paid a separate guest service fee, usually under 15%, although the exact percentage varied based on factors like booking length and location. Specific hosts faced higher costs, such as those with listings in particular destinations or those using “Super Strict” cancellation policies.

Day 2. Host-Only Fee Model:

Airbnb later introduced an alternative structure where the entire service fee is deducted from the host’s payout, and the guest sees a zero service fee listed. This fee is typically higher for the host, up to 16% of the payout. This approach is more guest-centric and obfuscates the Airbnb fees. Most consumers are unaware of OTA fees and consider the supply guilty of the higher prices, not the platform.

Like the split-fee, hosts with Super-Strict cancellation policies might pay more, while fees for extended stays (28+ nights) could be lower. This model mirrors the commission structure used by competitors like Booking.com. The key advantages cited are the guests’ transparency and the host’s complete control over the final price displayed. Legal rulings on price transparency are also forcing digital platforms to comply.

Day 3. Mandatory Host-Only

Fee for API/Software Users: A pivotal change occurred around December 2020. Airbnb mandated the Host-Only Fee structure for nearly all hosts connecting globally via third-party software (API integrations with PMS or Channel Managers), but exceptions in the USA, particularly. Convenient and easy to apply via API.

Day 4. Cross-Currency Fees.

Additionally, as of April 1, 2024, Airbnb implemented an adjustment for cross-currency bookings, incorporating an additional amount into the guest service fee (for split-fee structures) or potentially impacting the host-only fee calculation. In such cases, guest fees could reach up to 16.5%. Depending on the jurisdiction, value-added tax (VAT) may also be applied to service fees. Increased margins.

 

 

Cancellation Policies (excluding long-term)

Airbnb allows hosts to choose from cancellation policies, which dictate the conditions under which guests can receive refunds. These policies have evolved significantly, generally moving towards greater standardisation and guest-friendliness.

Standard Policies (Stays < 28 nights): Historically, hosts could select from Flexible, Moderate, Firm, and Strict policies.  The primary distinctions were the cutoff times for full refunds (e.g. 24 hours for Flexible, 5 days for Moderate, 30 or 14 days for Firm/Strict, with nuances around a 48-hour grace period after booking) and the percentage payout hosts received for cancellations occurring after these deadlines.

Certain hosts also had Invitation-only, super-strict 30-day and 60-day policies. Airbnb also introduced a non-refundable option, allowing hosts to offer a discounted rate in exchange for the guest forfeiting cancellation rights.

A significant overhaul of standard policies was announced, with changes taking effect from January 2025:

 

    • Universal 24-Hour Free Cancellation: A significant change is introducing a free cancellation period allowing guests to cancel for a full refund within 24 hours of confirmation, provided the booking was made at least 7 days before check-in. This applies across all standard policies.

 

    • Policy Simplification/Update: The standard policies were updated to: Flexible, Moderate, Limited, and Firm. The definitions were adjusted (e.g. Limited offers 50% payout for cancellations 7-14 days prior). Notably, the traditional Strict policy is being phased out for new listings, with existing listings automatically converted to Firm unless the host explicitly opts out to retain Strict.

These recent standardisations of cancellation policies, particularly the introduction of the 24-hour free cancellation window and the phasing out of the ‘Strict’ option, indicate a move towards enhancing the guest booking experience. 

Airbnb aims to improve platform conversion rates by reducing complexity and guest risk. While this will likely minimise host flexibility (especially for those preferring the Strict policy), the overall goal is to optimise the platform for booking volume and guest satisfaction.

 

    • Cleaning Fee Treatment: Starting April 21, 2025, cleaning fees are considered part of the nightly price when calculating payouts for cancellations occurring outside the whole refund period.

 

Opinion:

The mandatory shift to the Host-Only fee for most API-connected hosts is a major strategic decision. While framed as simplifying guest pricing, it fundamentally alters the competitive landscape for professional software managers.

This move, combined with the inherent complexities and potential friction points of API integration (discussed later), subtly makes direct hosting or utilising the co-host network (where fee structures might be negotiated differently between owner and co-host, see below) relatively more appealing within the Airbnb ecosystem. This differential treatment strongly suggests a strategic lever being employed to influence the composition and behaviour of its supply base.

Airbnb’s sophisticated payment platform is another key element. Its escrow function enables global operations, builds essential trust, and gives Airbnb a significant financial (and dispute) advantage through the cash float generated from holding guest payments. This underscores Airbnb’s strategic importance of controlling the end-to-end payment process.

Finally, Airbnb’s recent standardisation of cancellation policies, particularly introducing the 24-hour free cancellation window and the phasing out of the ‘Strict’ option, indicates a move towards enhancing the guest booking experience. Airbnb likely aims to improve platform conversion rates by reducing complexity and guest risk.

 

 

Host Technology

Airbnb has a suite of tools designed to help hosts manage their listings, pricing, bookings, and guest interactions more effectively:

 

Listing & Property Management: Hosts have tools to create and edit detailed listings, including descriptions, quality photos, amenity checklists, and house rules. For hosts with multiple properties, features exist to update details like fees, amenities, and policies across several listings simultaneously, improving efficiency.

Calendar and Booking Control: Calendar management allows hosts to control availability, set minimum and maximum stay requirements, define booking windows, and choose whether to enable Instant Book or require booking requests. Hosts can temporarily hide their listings using the “snooze” or “unlist” functions without permanently deleting them.

Pricing Strategy Tools: Hosts set their nightly rates but are supported by Airbnb’s pricing tools. They can offer weekly and monthly discounts to attract longer stays, positively influencing search ranking.

A significant recent addition is the “Price Tips” feature, which provides dynamic pricing suggestions based on real-time data from comparable nearby listings. Hosts can review and apply these suggestions with a single tap, helping them stay competitive.

Guest Communication: The platform includes an integrated messaging system for direct communication between hosts and guests. To streamline everyday interactions and improve responsiveness (a key factor in host performance metrics), Airbnb introduced “Quick Replies.”

This feature allows hosts to create and use customizable, pre-written templates for frequent messages such as welcome notes, check-in instructions, directions, and Wi-Fi details.

Performance Monitoring: Hosts can access dashboards providing insights into their earnings, allowing them to filter income by type and track payout status. Tools can also compare a listing’s performance against market benchmarks or the host’s goals. The built-in “Airbnb Insights” provides listing views, booking rates, and revenue data.

Trust and Safety Infrastructure: 

Beyond the financial protection of the Host Guarantee and AirCover, the platform incorporates tools to aid host security, such as guest profile verification and access to past guest reviews.

 

 

The Guest Journey

Finding the correct listing among millions requires a powerful search engine. The mobile app (now updated) is a central part of the guest experience and plays a role in search and repeat business, as well as experiences, services, and social connections! Airbnb’s algorithm ranks listings based on a multitude of factors, with significant weight given to:

 

      • Quality: Assessed through listing photos, guest ratings and reviews, listed characteristics and amenities, and host responsiveness/cancellation history.


      • Popularity: Measured by guest engagement signals like how often a listing is saved to wishlists, booking frequency, and message interaction rates.


      • Price: It is evaluated based on the total cost compared to similar listings (size, amenities) in the area for the requested dates.


      • Location: Proximity to popular landmarks or areas known to be desirable for travellers


    • Booking and Reviews: Instant Book and the two-way review system are critical for building trust and providing social proof for guests and hosts.

Airbnb increasingly leverages guest data and AI/Machine Learning (AI/ML) to tailor the experience. Search results, suggested destinations, and listing recommendations are personalised based on a guest’s past booking history, search queries, wishlisted items, and even upcoming trip details (suggesting nearby experiences). The new app and the direction of travel reinforce all of this. The acquisition of Gameplanner.ai further supports this focus.

 

Opinion:

The host tool set’s continual development begins to look suspiciously like a commercial PMS; the only thing missing is extra distribution. Not only does it have all the usual tools, but it also has massive data on guests and site traffic, prices, and destinations. It has security, insurance, competitive analysis, reporting, and more. There is no monthly cost, just a commission payment on a booking.

This ecosystem does not easily allow individual users to “game.” Still, API-connected businesses can adjust and amend their prices, content, and availability at will, threatening Airbnb, especially in leisure destinations with seasonal and peak pricing periods.

 

 

The Rise of Co-Hosting

 

Recognising that not all property owners have the time or inclination to manage hosting tasks themselves, Airbnb has formalised and promoted the concept of co-hosting. The network launched with over 10,000 co-hosts across 10 initial countries (including the US, UK, Canada, France, Australia). It grew quickly, reaching over 15,000 co-hosts managing more than 100,000 listings by the time of Airbnb’s Q4 2024 earnings report. Expansion to more countries is planned for this year, 2025.

Airbnb positions the co-host Network primarily as a solution for property owners who need assistance hosting. It cites survey data showing that over 40% of hosts would host more if they had help. The network is framed as “taking the work out of hosting.”

Crucially, Airbnb marketing materials emphasise the high average ratings of co-hosts in the network (4.86 stars), explicitly contrasting this with a lower average rating (4.62 stars) attributed to large property management companies. The network also allows experienced individual hosts or smaller operators to grow their businesses by offering co-hosting services.

Co-Host Network The network is an integrated marketplace within the Airbnb app and website. It allows property owners (“hosts”) to search for, find, and connect with experienced local co-hosts. Hosts can browse co-host profiles detailing their experience, services offered, guest reviews from listings they manage, typical pricing/fee structures, and other qualifications. A matching algorithm helps recommend suitable co-hosts based on many factors, including location proximity, hosting experience, similarity of property types managed, and guest satisfaction ratings.

To join the network, co-hosts must meet specific eligibility criteria, demonstrate significant hosting experience (e.g.,10+ stays or 100+ nights hosted/co-hosted in the past year), maintain a high average guest rating (4.8 stars or higher), have a low cancellation rate (below 3%), and complete identity verification.

A co-host assists the primary listing owner with tasks ranging from guest communication and check-ins to cleaning coordination and listing updates. The scope of responsibilities is flexible and agreed upon between the owner and co-host. This differs from a traditional full-service Property Manager who typically takes over all aspects, including financial management and often lists the property under the PM company’s account on booking channels. In the co-host model, the property owner usually retains ownership of the listing on Airbnb. 

Co-hosting has existed informally for years, often involving friends or family. Airbnb also previously acquired Luckey Homes, a co-hosting service, before the official network launch in 2024 as part of the Winter Release.

The platform facilitates communication, allows hosts to grant specific permissions to their co-host (e.g., calendar access, messaging, complete management), and enables direct payout sharing for bookings through Airbnb to both parties.

 

Opinion:

The parallel development paths of sophisticated native Host Tools and the formal co-host Network reveal a significant strategic direction. By investing heavily in features like Price-Tips and Quick Replies, mobile app-based tools, Airbnb empowers individual hosts to operate directly on its platform with greater efficiency and professionalism, potentially reducing their perceived need for external PMS solutions or other technologies.

Simultaneously, the co-host Network provides a structured, on-platform mechanism for hosts to delegate management tasks, often to other experienced individuals rather than large, potentially platform-agnostic PM companies. This dual approach keeps more hosting activity, operational data, and control within Airbnb’s ecosystem and avoids distribution to competitors.

Furthermore, Airbnb’s continuous investment in refining its search algorithm and enhancing personalisation is vital for its business model. Unlike standardised hotel inventory, Airbnb manages millions of unique listings. Effective matching – connecting the right guest with the right unique property – is paramount for converting browsing into bookings and ensuring guest satisfaction. The increasing use of guest data and AI/ML to personalise recommendations and search results is a strategic imperative to overcome the inherent complexity of its diverse inventory.

Finally, the launch and framing of the co-host network function as more than just a service offering; it acts as a competitive launchpad to dilute traditional management. 

By actively promoting the network and highlighting the superior average ratings of its vetted co-hosts compared to large managers, Airbnb subtly positions this on-platform solution as a higher-quality alternative. This potentially fragments the traditional property management market by empowering smaller operators and individual entrepreneurs within its ecosystem, creating direct competition for larger managers and potentially siphoning off business towards a management model over which Airbnb has greater influence.

 

 

API Integration and Property Management Systems

 

For professional property managers handling numerous listings, often across multiple booking platforms, direct integration with Airbnb via its Application Programming Interface (API) using Property Management Systems (PMS) or Channel Managers is essential for operational efficiency.

Role and Functionality of the API

Through the API, managers can synchronise core listing information (content, photos, amenities), manage availability calendars across channels, update pricing dynamically, receive and manage bookings, and automate certain guest communications (like sending check-in instructions) without needing to log into the Airbnb interface for each property manually. The goal is to save time significantly, minimise the potential for human error (especially with pricing and availability, reducing double bookings), and enable managers to optimise revenue across their portfolio at scale.

The Preferred Software Partner Program

Airbnb established the Preferred Software Partner program to guide hosts and property managers in selecting reliable software solutions and to incentivise software providers to maintain high integration standards. This program formally recognises and rewards PMS and channel management partners that meet Airbnb’s criteria for connectivity, performance, security, and supported features. The program provides hosts with a curated list of trusted partners.

Partners are evaluated based on their adherence to specific technical requirements, integration quality, foundational capabilities, security protocols, and performance metrics. Only partners who complete data security and API quality reviews are eligible.

There are two tiers within the program

 

      • Preferred: Partners who meet Airbnb’s standard requirements.


    • Preferred+: A top-tier designation (introduced or significantly expanded around 2023) for partners who exceed the standard requirements, demonstrating superior performance and deeper integration.

Achieving Preferred or Preferred+ status grants partners benefits such as enhanced technical support from Airbnb, potential early access to new API features or beta programs, and increased visibility within the Airbnb ecosystem. However, the level of integration and the number of specific Airbnb features supported can vary significantly even among partners within the same tier.

C. Limitations, Issues, and Complaints

Despite the benefits of automation, using the Airbnb API via third-party software presents several documented challenges and limitations frequently discussed by hosts and managers:

 

      • Loss of Direct Platform Control: A common issue is that once a listing is connected via the API, many aspects can no longer be edited directly within the Airbnb host interface. All changes to listing details, pricing, availability, and sometimes messaging templates must be managed through the PMS. This can be frustrating if the PMS interface is less intuitive or lacks specific fields or features available natively on Airbnb.


      • Feature Gaps and Synchronisation Problems: Not all PMS/Channel Managers support the full range of Airbnb features through their API integration. This can include specific amenity types, nuanced pricing rules, custom promotions, or newly released Airbnb features. Furthermore, synchronisation is not always perfect or instantaneous. Delays or errors in syncing availability, rates, or listing content can lead to incorrect information being displayed, lost bookings, damaging double bookings, or Airbnb settings being unexpectedly overwritten by the PMS. The reliability and speed of the sync (real-time vs. periodic) vary between software providers.


      • Mandated Settings and Policies: As discussed previously, connecting via the API forces most hosts to go to the Host-Only Fee structure. Some users have also reported losing access to certain native Airbnb features, like Custom Promotions, after connecting to a PMS.


      • Review and History Portability: Guest reviews and booking history are intrinsically linked to the Airbnb account that owns the listing. Suppose a property manager creates and manages listings under their own company’s Airbnb account (a standard traditional PM model). In that case, the property owner loses access to all accumulated reviews and historical performance data if they decide to switch to a different manager or self-manage. This represents a significant loss of a valuable asset built over time. This problem is circumvented by the co-hosting model, where the owner maintains the primary account and grants the co-host access.


      • Guest Communication Challenges: While PMS systems offer unified inboxes, managing Airbnb guest communication via API can have drawbacks. Airbnb provides hosts with anonymised (proxy) email addresses for guests, which often expire shortly after the stay, limiting post-stay communication. Real guest email addresses are typically not passed through the API. Issues have also been reported with message threads not displaying correctly, delays in message syncing, or incompatibility with certain Airbnb automated message features.


      • Support and Troubleshooting: When integration problems arise, hosts and managers can sometimes be caught between Airbnb support and the PMS provider’s support. Each potentially blames the other, making resolution difficult, but the OTA invariably holds sway!


    • Software Costs: Utilising a PMS or Channel Manager involves ongoing subscription fees, which add to property managers’ operational costs. Airbnb is free!

 

Opinion:

How Airbnb manages its API and the associated partner ecosystem carries strategic weight. While the API is undeniably necessary to accommodate the large volume of listings managed by professional operators, the inherent friction points and imposed constraints (like the mandatory fee structure for many) might serve a strategic purpose. They could subtly encourage managers, especially those with smaller portfolios or operating in regions affected by the mandatory Host-Only fee, to consider using Airbnb’s native tools more heavily or to adopt the co-hosting structure, which integrates more seamlessly with the platform’s preferred operational model.

The Preferred Partner Program allows Airbnb to influence software vendors, setting standards and rewarding those whose integrations best align with Airbnb’s technical roadmap, data requirements, and public PR persona! This helps ensure a degree of quality control but also reinforces Airbnb’s position at the centre of the ecosystem as companies boast their credentials and increase Airbnb’s brand. 

The documented challenges associated with API usage reinforce the narrative that the most feature-complete and potentially smoothest hosting experience is achieved when operating directly on Airbnb’s native platform or through its closely integrated co-hosting framework.

The existence of the API and the Preferred Partner Program signals that Airbnb recognises the current necessity of professional property managers to maintain its vast supply of listings. However, accumulating documented limitations, user complaints, and mandated policies like the Host-Only fee create significant operational friction for these users. 

This friction is not merely incidental; it effectively increases the relative attractiveness of using Airbnb’s native tools or engaging via the co-host Network. This suggests a deliberate strategy: to accommodate professional managers through the API, but simultaneously cultivate and favour a parallel supply channel (direct hosts and co-hosts) that offers Airbnb greater control, potentially higher loyalty, and a more seamless integration with its platform features and data infrastructure.

Furthermore, the technical architecture surrounding listing ownership and review portability advantages the co-hosting model over traditional PM practices, where the manager might own the channel listing. Reviews are a critical asset for success on the platform. By structuring co-hosting so the owner retains the account and its history, Airbnb provides a powerful incentive for owners to prefer this model, as it protects their long-term asset value. This aligns with a strategy focused on maintaining a direct relationship with the property owner, even when day-to-day management is delegated.

Finally, the tiered structure of the Preferred Partner Program and the varying quality of integrations, even among the top 30 partners, create an uneven landscape for managers. This demonstrates Airbnb’s power to set technical standards and steer the market towards software solutions that closely match its platform priorities.

How often have you heard a PMS criticise Airbnb or heavily promote methods to dilute their power? Never! OTAS are the easy route to bookings; direct booking is the hardest, and OTAS watch the narrative and press (believe me, I know!).

How much control does Airbnb have in the future by shaping what their API allows to be supplied and returned in data terms? It would not be without the bounds of reason to expect its ecosystem to be more advantageous when accessed directly.

 

 

IF IN DOUBT USE LEGAL

The vast majority of professional managers acquire direct guest information through various means. However, using this information can put any company in danger of account closure or worse.

 

This short analysis of Airbnb’s terms and conditions reveals a significant conflict between the act of a host soliciting in-person consent for an external marketing list during an Airbnb stay and Airbnb’s governing policies. While GDPR and PECR permit data processing for marketing based on valid, directly obtained consent, obtaining this consent within an Airbnb-facilitated stay likely contravenes the platform’s Terms of Service.

Specifically, this action “potentially” violates the Off-Platform Policy’s restrictions on using guest contact information for marketing lists and the prohibition against encouraging guest interaction with unauthorised third-party websites or services.

The primary and most immediate risk for a host engaging in this practice is Airbnb’s enforcement action, which could range from warnings to account suspension or permanent deactivation. This contractual risk exists even if the consent obtained meets GDPR standards. Secondary risks involve potential violations of GDPR and PECR if the consent obtained is not validly captured (freely given, specific, informed, unambiguous, recorded) or if the data is subsequently misused or inadequately secured. Negative guest perceptions and reputational damage are also practical concerns.

In summary, Airbnb’s policies, aiming to control the platform environment and prevent disintermediation, strongly indicate that soliciting guests during their stay for external marketing lists is a violation. The restriction on encouraging interaction with third-party services is particularly relevant. While GDPR allows guests to consent, it doesn’t override the host’s contractual agreement with Airbnb, prohibiting such solicitation during the stay. W

Operating successfully within platforms like Airbnb requires careful adherence to the platform’s contractual rules and overarching legal regulations like GDPR and PECR. While building direct guest relationships is an understandable goal for hosts, soliciting consent for external marketing lists during an active Airbnb stay carries significant contractual risks that likely outweigh the potential benefits.

With the new focus on experiences, services, and an app that provides a single booking and communication system, expect the same T&CS to apply when offering guests competitive products or services.

 

 

ARTICLE SUMMARY

 

Strategic Analysis: Is Airbnb Prioritising Individual Hosts and Co-hosts?

A central question surrounding Airbnb’s recent evolution is whether the company is strategically shifting its focus towards cultivating individual hosts and enabling them through its co-host Network, potentially deprioritising relationships with larger, professional property management companies that connect via API and PMS integrations. Do experiences and services assist this? Analysing Airbnb’s actions, policies, and communications provides a hypothesis that hosts are being substantially prioritised.

 

 

The Hypothesis

 

      • Co-Host Network Investment and Framing: The formal launch and significant promotion of the co-host Network in October 2024 represent an important strategic investment.


      • Airbnb’s messaging explicitly highlights these co-hosts’ high average guest ratings stars and contrasts them favourably with the lower average ratings.


      • API/PMS Friction and Constraints: Utilising the Airbnb API through third-party software is associated with several friction points and is a simple method of elevating co-hosts and host advantages through restrictive API management.


      • Native Host Tool Development: Airbnb continues to invest in sophisticated native tools that increasingly look like a quality mini PMS, with associated trust models (insurance, identity management and payments).


      • Brand Alignment and Marketing: Airbnb’s brand identity has always been closely tied to the concept of unique homes and local hosts providing authentic experiences. STRS are not hotels, and they understand the differences.


    • Underlying Strategic Drivers: Several factors likely motivate this strategic tilt:

          • Host Loyalty and Exclusivity: Individual hosts, especially those reliant on Airbnb for supplemental income, may be more likely to list exclusively or primarily on Airbnb than professional managers, whose business model often involves maximising distribution across all available channels.


          • Platform Control: Managing supply through native tools and the co-host framework gives Airbnb greater influence over pricing


          • Operational Efficiency/Cost: Supporting a diverse array of complex third-party API integrations can be resource-intensive. Funnelling management through a standardised co-hosting system within its platform might be more operationally efficient for Airbnb in the long run.


          • Regulatory Navigation: A model emphasising individual owners, even when assisted, might be perceived more favorably by some regulators or fit more easily within specific regulatory frameworks designed for home-sharing rather than commercial lodging


        • Provision of supplementary experiences and services in a siloed app-based travel itinerary approach. This latest move and a relaunch of experiences, is likely to “rattle” managers who have evolved upsell opportunities and may see a further polarisation, opting out of the program and on;y allowing their own advised supply and sharing financially. Most hosts will not have the capacity to organise this benefit, but can rely on Airbnb to satisfy the guests.

 

Evidence Against the Hypothesis

While the evidence for a strategic tilt is strong, it’s not necessarily indicative of an outright abandonment of professional managers:

 

      • Significance of Professional Supply: Large management companies, including major players like Vacasa (a Casago Company), manage a substantial volume of listings on Airbnb and are critical for inventory, particularly in traditional vacation rental destinations and certain property types. Airbnb cannot afford to alienate this significant supply source entirely (at the moment!).


      • Continued API Support: Airbnb continues to operate and invest in its API and the Preferred Software Partner program. This indicates an ongoing commitment to enabling integration for professional managers who require it for their operations.


      • Co-hosting as a PM Opportunity: The co-host Network is not exclusively for individuals. Professional PM companies can potentially register and use the network to acquire new leads, although success appears limited.


      • Guest Demand for Professionalism: While the “local host” narrative is powerful, many guests prioritise consistency, reliability, cleanliness standards, and professional communication, qualities often associated with well-run management companies. Despite Airbnb’s ranking data!


    • Scalability and Sophistication: Professional managers using advanced PMS software possess capabilities in large-scale portfolio management, complex revenue management strategies, and sophisticated operational logistics. This expertise remains valuable, especially for owners of multiple properties or those seeking maximum optimisation.

 

Cumulative Evidence

The cumulative evidence strongly suggests that Airbnb deliberately rebalanced its strategy, favouring models that enhance its platform control and align with its brand identity. The significant investment in the co-host Network and the introduction of friction points for API users signal a preference for hosting arrangements managed directly on or closely integrated with the Airbnb platform.

This strategy does not necessarily equate to eliminating large professional managers but aims to reshape engagement terms. Airbnb appears to be fostering an ecosystem where individual hosts are empowered with better tools, and delegated management increasingly occurs through the co-hosting framework – a framework that keeps the property owner central, preserves listing history with the owner, and operates within Airbnb’s rules and payment systems.

Professional managers, especially those breaking into the industry, are thus presented with a choice: adapt to operate within this preferred framework (potentially registering as co-hosts and leveraging the network for leads) or continue via the API pathway, accepting the associated friction and potentially facing increased competition from platform-enabled co-hosts. The strategy seems designed to encourage the former, thereby increasing Airbnb’s influence over its entire supply base, enhancing data visibility, and strengthening its core value proposition around unique, quality-controlled stays.

This strategic direction can be understood as less of a binary choice between individual hosts and professional managers, and more about Airbnb reshaping the relationship with managed supply. The promotion of co-hosting and the simultaneous imposition of constraints via the API work in concert to encourage management models that operate within Airbnb’s platform and align with its tools and policies.

Whether the day-to-day manager is an individual co-host found through the network or a professional company adapting its services to act as a co-host, the outcome benefits Airbnb. This structure keeps the primary property owner’s account central, preserving valuable review history with the owner and reinforcing Airbnb’s direct relationship, unlike traditional PM models, where the management company might control the listing entirely on the channel. The core strategic objective is the increased structural and recent shift towards owner-centric, platform-integrated management.

Furthermore, the explicit comparison of co-host ratings to those of large managers serves a strategic competitive purpose. It provides owners seeking management help with a data-driven reason to consider the co-host Network, potentially perceiving it as a higher-quality option. Simultaneously, it puts larger managers on notice, benchmarking their performance against this highly-rated segment and implicitly pressuring them to elevate their service standards to remain competitive within the Airbnb ecosystem. This dynamic creates competitive tension, benefiting Airbnb by improving overall quality perception across its platform.

This strategic tilt also resonates strongly with Airbnb’s established brand identity. The platform’s success was built on the promise of unique stays and authentic local connections. Large, multi-platform management companies offering standardised units can sometimes dilute this brand promise. By actively promoting individual hosts and the co-hosting model (often involving individuals managing properties locally), Airbnb reinforces its core brand narrative and differentiates itself from more transactional competitors like Booking.com. Maintaining this unique positioning is crucial for its brand’s long-term competitive advantage.

 

 

Future Outlook: Airbnb’s Strategic Direction

 

Based on recent company communications, product releases, and leadership statements, Airbnb’s future strategy focuses on refining its core business while expanding its scope and deepening its integration into users’ travel and living arrangements. Now offering a host and consumer experience and group social app-based approach, Airbnb is developing incremental income and using its 5m host network and 2bnb previous travellers to leverage this product focus.

 

Expansion and Diversification

Airbnb signals ambitions beyond its traditional short-term rental marketplace:

 

      • Geographic Growth: The company aims to increase penetration in markets with lower presence. Its S-1 filing explicitly mentions India, China, Latin America, and Southeast Asia as target regions, alongside smaller towns and remote areas globally.


      • Beyond Short Stays: There is a continued emphasis on catering to longer stays (28+ nights), driven by remote work trends. Programs like Airbnb Friendly Apartments and Chesky’s comments about blurring lines between travel and living suggest a strategic interest in expanding into the broader housing market, offering more longer-term rental solutions or subscription-based living models.


      • New Services: Airbnb has again moved beyond just accommodation. This includes reigniting and expanding its ‘Experiences’ program and adding adjacent travel and hospitality services. This has been a stated goal to become more of a “one-stop shop” or potentially a “super app” for travel and related activities, providing more reasons for users to engage with the platform more frequently.


    • New Revenue Streams: The potential introduction of advertising, such as sponsored listings promoted by hosts, is seen as a way to monetise the platform further and boost profit margins and share price.

 

Host Strategy

The approach towards hosts appears centred on enablement, quality, and integration:

 

      • Co-host Network Expansion: Continued investment in and expansion of the co-host Network to more countries is explicitly planned for 2025.


      • Quality and Engagement: Programs like Superhost and Guest Favourite, potentially engaged with bodies like the Host Advisory Board (HAB), will likely continue to incentivise high-quality hosting, gather feedback, and foster a sense of community and loyalty among hosts.


    • Tool Development: Airbnb is expected to continue developing and refining its native tools to help hosts manage pricing, communication, and performance more effectively, making professional-level hosting more accessible directly through the platform.

 

Competitive Positioning

Airbnb aims to maintain its unique position in the market:

 

      • Brand Differentiation: The strategy emphasises differentiating based on unique inventory, the host community, experiences and services and building trust, rather than competing solely on price or breadth of offerings (like flights).


      • Strategic Divergence: The executive team has explicitly stated intentions to avoid strategies pursued by competitors like Booking.com, such as implementing points-based loyalty programs or relying heavily on paid performance marketing, despite the recent “Hotel Tonight” loyalty scheme. The spoken focus remains on organic growth driven by brand strength and product appeal; however, what is said is often not what happens, and discounting these options would not be very reasonable!


    • AI as a Differentiator: Leveraging AI/ML for superior matching, personalisation, and potentially operational efficiency is a key competitive advantage, particularly given Airbnb’s heterogeneity of inventory and huge customer base.

 

Financial Goals

The company’s financial strategy focuses on sustainable growth and profitability:

 

      • Profitability: Maintaining and increasing the profitability achieved in recent years and generating strong free cash flow remain key objectives.


      • Growth Drivers: Growth is expected from increasing booking volume, potentially moderate ADR growth, successful expansion into new geographic markets, and monetising new services and features.


      • Margin Expansion: Improving operating margins is a goal driven by economies of scale as the business grows and potentially augmented by new, high-margin revenue streams. Incremental fees, such as 24-hour cancellation fees and commission structures, can also increase margins.


    • Airbnb’s latest update also reveals the underbelly of this digital sharecropping: they’re now monetising hosts’ properties through third-party services (automatically opted-in) while keeping 100% of revenue. Hosts provide the physical space and maintenance, assuming liability risks, and extracting additional value without compensation.

Airbnb’s articulated future strategy paints a picture of a company seeking to evolve substantially beyond its origins. The ambition extends towards creating a deeply integrated ecosystem encompassing not just short-term travel accommodation, but potentially longer-term living solutions, a wider array of experiences, and adjacent services, all stitched together by sophisticated AI and personalisation.

This represents a significant expansion of scope, pushing Airbnb into competition with traditional businesses and potentially with real estate platforms, service marketplaces, and lifestyle brands. Successfully executing this vision requires substantial ongoing investment in technology and careful integration of diverse offerings to maintain a cohesive user experience. It also means a lot of hard work for the defence team in the PR department.

The continued focus on supply is central to achieving this broader vision, particularly through models that enhance platform control and quality. The ongoing investment in the co-host Network and native host tools confirms that facilitating managed hosting, structured within Airbnb’s framework, is viewed as the primary engine for future inventory growth and quality assurance. This reinforces the strategic tilt away from reliance on purely external, API-connected management, favouring models that keep operations and data closer to the core platform.

Despite recent activity, Airbnb’s deliberate choice to avoid common competitor tactics like formal loyalty programs and heavy spending on performance marketing signals a strong belief in its unique assets: brand power and user experience. We do not believe this is sustainable, as competitors encourage their huge memberships and those of aligned businesses to book on their platforms. Unless Airbnb is more host-centric, it may see increased churn and booking dilution.

The company verbally bets that cultivating a strong community, offering unique inventory, and delivering a superior, personalised product experience will foster more durable customer loyalty and provide a more sustainable competitive advantage than engaging in transactional incentive wars. However, history shows this is hard to avoid in a global and digital market where a lack of loyalty is only a finger click away.

 

 

Professional managers (PMC’s)

New “managers” invariably use OTA channels for 80-90 % of all bookings. Airbnb is the biggest, best-known, and best tech entry point. Multi-channel distribution is not needed for small, well-curated, highly recommended accommodation. There is no disguising the fact that Airbnb has built an enviable ecosystem. The older established managers use Airbnb as a channel, are agnostic to the source, and will generally seek to de-risk and compete directly.

What are the arguments for and against?

1. Adopt the Airbnb model and simplify your life by co-hosting. Let them provide the tech and bookings, handle payments, and upsell experiences and services to guests without compensation. Essentially, it is a cleaning management company.

 

      • Pros: It’s easier. Think Bob Dylan


    • Cons: Long-term capital value as long as the contracts are with the originating hosts, and very high distribution dependency. Growth means booking pressure across multiple units.

2. Use Airbnb as one of many channels and a marketing mix.

 

      • The pros are: fewer single points of failure, options to upsell, building a brand, and longer-term capital value. Contract control and more direct contact and control over guests!


    • Cons: It means a more “endurance approach”

3. Join a Franchise: A good franchise can help you work through the complexities of the second option and give you practical, moral, and community support. It also comes with a higher capital benefit than the first option!

On this second option, the other two big companies, Expedia/VRBO and Booking.com, also have designs on growth and profit. However, they are less interested in controlling an entire ecosystem in a personal (and obvious) way and expect supply leakage. They also focus on mainstream travel and have acquired hospitality businesses to bundle products.

VRBO at least visibly works more toward an integrated and distributed ecosystem. “Bookings” hotel success and challenging tech extranet have held back more success with owners and small managers. However, it has grown dramatically, and its demographic and tech are still hotel-minded. Airbnb has also driven these businesses to diversify, VRBO with urban inventory and Booking to extend its STRS portfolio substantially. But Expedia and Booking are well-diversified travel powerhouses with other “fish to fry”.

The third option, franchising, is not for everyone, but it is a serious option in a large enough, single-language market with a well-structured legal framework and a unique destination size.

 

 

As mentioned above, the video is well worth watching if you are concerned about your marketing strategy using Airbnb!

Humphrey Bowles

 

 

This report is intended for informational purposes only and does not constitute legal, financial advice. It is based on personal opinions, research and conversations with industry managers and hosts. Please feel free to distribute with credit to https://yes.consulting

Any logos representing commentary or illustrating Airbnb are the copyright of Airbnb

 

If you’ve read this far, thank you. Feel free to reach out if you have tech, property management, or M&A questions. Please use the “About Us” menu and pages for individuals or [email protected].

 

 

 

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