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Business / Economy

Optimism for growth drives Airbnb in China

By Fan Feifei (chinadaily.com.cn) Updated: 2016-01-21 13:37

Airbnb Inc, the US-based lodging website, is optimistic that its business in China will maintain rapid growth this year as China has become world's largest outbound tourism market.

According to Airbnb, the number of Chinese outbound tourists that book accommodations through Airbnb has increased by 700 percent in 2015. Although China is entering a new phase in economic development, with growth slowing, the guesthouse booking platform is positive about its increase.

"We don't see any impact on our business and have a very positive outlook for business with outbound travelers in 2016," said Varsha Rao, vice president of global operations at Airbnb, adding "we hope to maintain the growth level of last year."

"Our business in China is still growing. We are building awareness, focusing on millennial travelers born between the early 1980s and 2000s travelling to other parts of the world."

China had the world's largest number of outbound tourists in 2015, and about 120 million Chinese traveled overseas in 2015, up from 109 million the previous year, according to data from the China National Tourism Administration (CNTA).

Since 2012, China has ranked first worldwide for outbound tourists, according to the World Tourism Organization.

The rapid growth of the Chinese outbound tourist market means huge opportunities for Airbnb. China has become the fastest growing market for them and more and more Chinese travelers prefer a unique travelling experience different from staying at a hotel.

"It is different from staying in the hotel; it's about creating stories that you can share with your families and friends when you come back," Rao said.

Due to concentrating on outbound travel, Chinese short-term rental platforms such as Tujia.com and Mayi.com seem not to constitute a threat to them.

Founded in August 2008 and based in San Francisco, it has connected 50 million users in more than 34,000 cities of 190 countries. About 2 million homes are offered on the website.

Last year, it finished a series-E fundraising of $1.5 billion and introduced Chinese investors such as China Broadband Capital and Sequoia Capital China to step up their expansion in China's market. It has established a team of more than 10 people so far.

"To be relevant to Chinese travelers and users, we need to learn more to localize. Both of these Chinese partners have had a good track record of helping American companies localize," adding they help Airbnb in building relations with governments and recruiting members of the team in China.

Moreover, it has cooperated with Chinese community-based travel websites Qyer and Mafengwo, so travelers could reserve rooms provided by Airbnb through these two platforms.

"The users of the two websites are mainly youths keen on individual overseas travel. They are adventurers and like to try new destinations and looking for different travel experience. We will continue to build deep relationship with local partners like Mafengwo and Qyer in 2016, Rao said."

Ma Tianjiao, an analyst with the Beijing-based Internet consultancy Analysys International, said, "Nowadays people are willing to try something different during a trip. They are not satisfied with a hotel, which provides single and unfeatured service, but short-term rental platforms could offer diversified living experiences."

However, Airbnb still face challenges in the domestic market.

"Unlike Europe and US consumers, Chinese consumers need to cultivate the idea of sharing homes. There are a lot of vacant houses in China, but few of the owners are willing to share them with travelers," said Ma, the analyst.

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