Airbnb has grown to a $30 billion valuation as a global marketplace for home and apartment rentals. Now the company has launched what it hopes can be another growth engine: An “experiences” business where travelers can book tours and activities led by local experts.
At an event today in Los Angeles, Airbnb CEO Brian Chesky unveiled the company’s new “Trips” product, which has been under development for several years, recently in private beta testing.
The main new feature: Starting today, Airbnb users will be able to browse and book a range of tours and group activities, such as “truffle hunting,” Korean embroidery lessons, food-market tours, reality-TV casting and multi-day “immersion” experiences in a dozen cities around the world.
“The home was a great first step,” long-time Airbnb product head Joe Zadeh told Recode. “But it’s not enough to create that entire feeling of a sense of belonging to a city,” he said. “We see this as critical.”
For Airbnb, it’s an organic extension of its brand, which promotes an authentic, somewhat hipsterish view of travel. And it’s an obvious new use for its app, which it’s trying to make both a starting point for vacation planning and a close companion while traveling.
It’s also an opportunity for the company — which is inching toward an inevitable public offering — to capture a greater share of the amount of money its users spend while traveling.
The high-touch tours are not cheap. While half of Airbnb’s initial set of experiences cost less than $200 per person, according to the company, others are much more. For example, a two-day bonsai tree immersion in Tokyo costs $431 per person for up to six guests. (“Masashi was amazing,” reads one review from last month. “He made us feel as though we were old friends visiting his home.”)
If these experiences prove popular, it’s not hard to imagine a scenario where they represent a meaningful portion of a traveler’s Airbnb bill — and a growth driver for the company. Airbnb takes a 20 percent cut from these bookings, which is more than it takes for home rentals. The company will vet the experiences it offers, and aims to create real business opportunities for its tour hosts, Zadeh says.
According to the U.S. Travel Association (pdf), lodging represented about 20 percent of the $947 billion in travel spending in 2015 (excluding airfare). Recreation and amusement represented about 10 percent. The other 70 percent consisted of food service, public and auto transportation and retail spending.
Along those lines, Chesky unveiled a new restaurant-reservation feature, in partnership with a startup called Resy. He also teased services like flight booking and grocery ordering, coming soon to Airbnb’s expanded “trip platform.”