Airbnb: Tourism Will Drive Sustainable Growth in Developing Economies

According to Airbnb, growth in international tourism is occurring at a rate twice as high as in developing economies, at 4.4 percent versus 2.2 percent. By 2030, over one billion travelers will land in emerging economies annually.

Those numbers generate high expectations that more people can be lifted out of poverty – and raise fears that these visitors could trample upon local communities’ environment and way of life, as discussed this week at the United Nations World Tourism Organization’s (UNTWO) Conference on Jobs and Sustainable Growth this week in Montego Bay, Jamaica.

Airbnb, however, insists that its platform can help more families worldwide build wealth. For almost a decade, the online room sharing service has allowed users to rent out spare rooms, apartments, villas and even a castle here and there. And with the recent addition of Airbnb’s Experiences platform, by which travelers can book activities such as cooking classes, local tours and even burlesque lessons or truffle digging, the company says more citizens in more places can benefit financially from international visitors.

The company’s diversification of its online travel offerings scored the buy-in of Jamaica’s Minister of Tourism, Edmund Bartlett, who yesterday asked an audience at the UNWTO conference, “How do you add more stakeholders to this sector and allow more people to benefit from tourism? And how do you prevent us from being the victims of our own growth?”

One answer has been Airbnb, which says 2,900 hosts across the Caribbean island nation hosted over 50,000 visitors last year.

Furthermore, Airbnb says organizers of “Experiences” keep about 80 percent of their generated revenue; hosts on average keep about 97 percent of the prices they charge their overnight guests.

Contrast those numbers with how most industries operate, added Christopher Lehane, Airbnb’s global head of policy and public affairs. “In most sectors, the company that sits on top of the supply chain gets the most money.”

Airbnb, however, has turned that traditional model upside down, giving its suppliers the flexibility they need to allow guests when they want on their terms, while pocketing most of the cash.

Lehane arrived in Jamaica to announce the company’s plan to broaden its Trips platform to Jamaica, as well as agreement the company has made with the country's government to find ways to make the country's travel sector more inclusive. In addition to accommodation bookings, this service allows users to visit local communities and join activities organized by local hosts and experts. A pilot the company recently launched in Jamaica has generated $6 million in revenues to date, explained one Jamaican tourism official to TriplePundit.

Airbnb says a focus on countries such as Jamaica will foster a more inclusive travel industry. The company expects 400 million guests to use its online booking service by 2030 while staying at the homes of over 28 million hosts. And much of that new activity will occur in emerging economies, allowing underserved communities to piggyback on the global tourism boom. The company expects the global surge in mobile technology and broadband access to help make this push possible. But despite the proliferations of cell phones and broadband, many regions of the world still lack access to more robust economic opportunities and offer little, if any, upward mobility.

To that end, the company has tested pilot programs around Cape Town, South Africa, at one of the city’s oldest black townships; that project will expand to more townships over the next few years, said Lehane. In rural India, the company has entered a partnership with a trade union comprised of 2 million Indian women – one example of how Airbnb says it is striving to ensure its services can give an economic lift to more women worldwide. Another project in Jordan involves giving Syrian refugees an opportunity to share their stories with visitors – aligned with Airbnb’s goal to find temporary housing for 100,000 refugees worldwide over the next 10 years.

Image credits: Leon Kaye