How Can Airbnb Hosts Improve Their Experience on Airbnb?
By: Jong Min, John
Tags: Airbnb, Data Analysis, Data Science, Data

How Can Airbnb Hosts Improve Their Experience on Airbnb?

Exploratory Analysis of Airbnb’s Data in Hawaii to Find Ways Hosts can Improve their Occupancy Ratings and Improve their Overall Experience

Credits to Abigail Lynn

Introduction

In 2007, Airbnb started off as a small hosting service when founders, Brian Chesky, and Joe Gebbia, first hosted a guest on airbedandbreakfast.com. Since then, Airbnb has grown exponentially with over six million listings worldwide in more than 100,000 cities. Since its conception, Airbnb has become a strong competitor against the hotel industry. In fact, Airbnb’s valuation exceeded that of every major hotel chain in 2016. (Source: Atlas)

Airbnb’s success as a company is only as great as its unique and welcoming hosts and listings. The amazing hosts and listings have allowed Airbnb to grow to what it is today, allowing travelers to have more interesting, intimate, and personalized visits around the world. Therefore, it is in Airbnb’s best interest to help their hosts succeed. Below are 5 recommendations for hosts to improve their experience and listings on Airbnb. All recommendations are based off Inside Airbnb’s data for Hawaii.

1. Be Inclusive of all Nationalities!

“Airbnb exists to create a world where anyone can belong anywhere, providing healthy travel that is local, authentic, diverse, and sustainable.” (Source: Airbnb) Embracing this value will allow hosts to improve their occupancy rate for the following reason.

From the data collected by Hawaii’s Department of Business, Economic Development, and Tourism, we can observe which countries tourists come from. From the figure above, we can observe that the majority of tourists are domestic. However, the number of Japanese and Canadian tourists should be noted with more than 100,000 Japanese tourists and approximately 50,000 Canadian tourists visiting Hawaii monthly.

Due to the large influx of international tourists in Hawaii, if a host provided details and instructions in multiple languages, their listings would appeal to a much wider market. Being inclusive of everyone would not only improve occupancy rates but also be a valuable experience to meet guests from all over the world.

2. Pricing Should Change with Demand

The hospitality industry is dynamic, and pricing and demand constantly fluctuates. Every month, hosts should evaluate and consider the price of their competitors, the demand for listings based on the number of tourists that month, and their listing’s placing on the search rankings.

Number of Tourists in Hawaii by Month in 2018

In September, the number of tourists falls by approximately 100,000 from the mean number. This fall in the number of tourists was not statistically significant. However, there is a 87.7% chance that the number of tourists in September is below the average number of tourists in Hawaii.

Therefore, hosts should lower their prices to match the lower demand for listings as the price is a large factor in the guest’s search for a listing or even a hotel. Therefore, by evaluating market trends and accordingly changing the price, hosts can stay competitive in the ever-changing market.

3. Instant Booking Is Not Necessary But Recommended

Hosts do not have to turn on the instantly bookable feature, nevertheless, this feature is recommended. As we can see in figure 2, listings in Hawaii that were not instantly bookable were occupied more frequently. However, it should be noted that the data analyzed only represents Hawaii, which is a popular tourist destination with specific characteristics. Every city and environment differs, as well as the reason for the booking. This recommendation may not apply across the board. For example, if the listing is located in an area associated with business trips, like New York, the Instant Booking feature may be very beneficial. In addition, Airbnb’s search algorithm boosts the ranking of listings with the instantly bookable feature.

However, if the listing is located in a tourist destination, such as Hawaii, hosts may not need to go out of their way to make their listing instantly bookable. Airbnb states that listings that perform well on other booking experience factors will also perform well in search rankings. The host’s safety and comfort should be the first priority and having time to approve their guests may be more desirable.

Figure 2.

4. Do Not Put Too Much Pressure on Yourself To Become A Superhost

Airbnb states that in order to become a superhost you must:

Complete at least 10 trips or 3 reservations that total at least 100 nights

Maintain a 50% review rate or higher

Have a 90% response rate or higher

0 cancellations with exceptions made for those that fall under a certain poly

Maintain a 4.8 overall rating.

Superhosts are passionate about their listings and put an extraordinary amount of effort to improve their guests’ experience. In fact, superhosts in Hawaii had an average response rate of 100% in 2018.

Despite the large commitment required to become a superhost, the superhost designation has a small impact on a host’s occupancy rate. For listings in Hawaii, there was only a difference of approximately 25 days of occupancy between Superhosts and regular hosts.

Moreover, Airbnb states that the Superhost designation does not boost listings. It is, in fact, the factors that earn you the superhost status that improves your search ranking. Here is an article by Airbnb that provides more information about Airbnb’s search algorithm. (Link)

5. Take Great Photos!

Taking great photos is arguably the most important factor of any Airbnb. A great photo consists of bright lighting and factors the composition. Hosts are recommended to shoot photos during the day with all the lights turned on. Hosts should also consider the rule of thirds and have visual queues that keep the eye moving. Consider the photo on the right, the photo follows the rule of thirds with the tiles on the floor and the countertop representing each third. In addition, the edges of the tables keep the eye moving towards the terrace. Here is an article provided by Airbnb that highlights 5 photo tips for a stellar listing (Airbnb Blog).

On Airbnb, most guests determine the listing of their choice by looking at the photograph. Even Airbnb states that hosts could see an increase of 40% in their earnings, 24% more bookings, and hosts can charge up to 26% just by having their photos professionally taken.

Therefore, it would be a great investment to have a professional photographer take photos of the listing.

Airbnb recognizes the importance of these images. In fact, they have a website that will match you with a professional photographer in your area. (Airbnb Photography) The added benefit of utilizing their website is that the cost of hiring the photographer will be subtracted from the hosts’ next payout.

If hosts decide to choose this route, they will have 2 to 3 photos of each room. Here, hosts can choose the photos that they think will have the most success. I have also created a machine learning algorithm that has looked at 100 different images of successful and less successful listings in Hawaii. The algorithm will predict whether or not a listing would be successful by looking at an image. (LINK) This algorithm is still in its very early prototype stages, therefore, it’s output should be taken with a grain of salt.

Here are 10 examples of the machine learning algorithm’s predictions. From the machine learning algorithm, I found that images with an ocean view and photos that took composition into account were frequently predicted to be more successful. I noticed multiple listings in Hawaii that included images of trees blocking the view to the house such as the third photo in the first and second row. These listings were all predicted to not be as successful. Therefore, I would advise hosts to take photos of their house from a clear line of sight.

In conclusion, here are some ways hosts could improve their experience on Airbnb. The recommendations above were solely based on the data from Hawaii. While I would have loved to further analyze the impact of changing prices and inclusivity through A/B Testing, I hope that these recommendations are able to improve hosts’ occupancy and experience on Airbnb. Inside Airbnb has collected data from other major cities, and I will continue to explore how these recommendations translate in different cities.

For a more in-depth analysis of these recommendations, an exploratory data analysis, and source code for the machine learning algorithm, please feel free to check out my website.