Morgan Stanley: Growth of Airbnb slowing in U.S and Europe

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Morgan Stanley: Growth of Airbnb slowing in U.S and EuropeThe slowing growth applies to both leisure and business travelers

New research from Morgan Stanley has suggested that the pace of growth of Airbnb use is slowing down across the U.S. and Europe.

In its third annual AlphaWise survey, the firm discovered that the share of travellers who used Airbnb during the past 12 months rose to 25 percent, an increase of 300 basis points, which is lower than the prior year's growth of 800 basis points.

The research indicated that that the slowing growth applies to both leisure and business travellers. The firm had expected business travel adoption to increase from 18 percent in 2016 to 23 percent in 2017. Instead it grew to only 20 percent. Morgan Stanley attributes the tempered growth to a plateau in awareness of Airbnb; awareness of the platform from online consumers is at 80 percent across the U.S., the U.K., Germany and France, and the 800-basis-point year-over-year growth in awareness is significantly lower than the 2,000-basis-point spike noted in 2016.  

The report pointed out:"Awareness-driven adoption can only go so far among this demographic in these countries,"  

Concerns about Airbnb guests' safety and security are also on the rise; the number of people concerned about such issues rose from 10 percent in 2016 to 25 percent in 2017. Additionally, the percentage of non-Airbnb users who cited concerns about privacy grew to 36 percent, up 700 basis points, and non-users worried about security grew to 13 percent, up 400 basis points. 

The report stressed: "This is surprising and potentially troubling for Airbnb's growth, typically, consumers become more comfortable with emerging technologies as awareness/testing/adoption grow. This doesn't appear to be happening for Airbnb."

Morgan Stanley has revised its forecast for user adoption down from 31 percent to 28 percent for 2018, from 37 percent to 30 percent for 2019 and from 43 percent to 31 percent for 2020. These results could prove to be beneficial for the hotel industry which has seen weaker pricing during the current cycle than in other historical periods. 

The report also concludes that online travel agencies will be the real winners in all this. The report went on to say: "If anything, we see the OTAs' strong use trends, paid search/traffic acquisition expertise and improving inventory offering (more alternative accommodations) becoming a growing threat to Airbnb, as the OTAs, in our view, are better positioned to act as the online travel one-stop shop."

Read more here.

RELATED TOPICS: GreeceGreek tourism newsTourism in GreeceGreek islandsHotels in GreeceTravel to GreeceGreek destinations Greek travel marketGreek tourism statisticsGreek tourism report

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