Airbnb Sharpens Focus on Cheaper Stays as Customers Become More Price-Sensitive

The short-stay accommodation platform has taken actions such as giving more visibility to private, lower-priced room options, Catherine Powell, Airbnb’s global head of hosting, tells Bloomberg Línea

Catherine Powell, Airbnb's head of global accommodation, during the Web Summit Rio 2023 event in May. (Photographer: Piaras Ó Mídheach/Web Summit Rio via Sportsfile)
May 29, 2023 | 11:45 AM

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Bloomberg Línea — Amid a challenging economic scenario, with higher interest rates and wage stagnation, Airbnb (ABNB) is taking actions to maintain customer demand.

“We know our guests are price sensitive,” Catherine Powell, Airbnb’s global head of hosting, said in a recent interview with Bloomberg Línea on the sidelines of the Web Summit Rio event that brought together tech entrepreneurs and analysts from around the world.

Powell said the company has sought to mitigate the challenges posed by inflation and rising costs in various regions of the world, introducing, for example, the ‘private rooms’ category within the platform. This type of accommodation is priced at below $100 globally in 80% of cases, she said.

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Airbnb has addressed these concerns for both guests and hosts by featuring all-inclusive pricing. This allows guests to see the total amount up front and avoid being taken by surprise, a long-standing demand from users.


The platform is also offering discounts for longer stays, as well as providing tools for hosts to understand and compare their pricing strategies, something that can make the difference between getting a guest faster or a property staying vacant longer.

From a geographic standpoint, the Airbnb global executive said that Latin America has been an important growth driver for the company.

Increases in the number of hosts, bookings and demand during Q1 2023 indicate the region’s resilience for the traveling public, according to Powell.


The San Francisco-based company’s latest quarterly result showed that accommodation supply grew 18% compared to the same period a year earlier.

That growth was seen across all regions and markets, with Latin America and North America showing the fastest expansion, with both urban and non-urban properties seeing an 18% year-over-year increase.

Rise In Demand for Latin America Rentals Boosts Airbnb’s Results

Strong growth in Mexico and Brazil

Latin America’s performance saw a 22% increase in nights and experiences booked on a year-over-year basis. Certain countries in the region, such as Mexico and Brazil, exhibited resilience and contributed significantly to the overall positive trend, the company said in its Q1 results report.

Powell highlighted the growth the company has experienced in these two countries over the past year.

“We have strong growth in the number of visitors to the region,” Powell said.

Even more relevant is the comparison to the pre-pandemic period in the first quarter of 2019. Latin America outpaced other regions and established itself as the fastest growing area for Airbnb, with a more than double increase in bookings since then.

The platform also recorded an overall increase in supply across all regions during the first three months of 2023 compared to the same period in 2022.


Last year, guests using the platform spent $5.2 billion in Brazil on direct tourism expenses in addition to payments on the platform, according to an economic impact study by Oxford at Airbnb’s request. In Rio de Janeiro, guests contributed $1.3 billion to the local economy and supported the creation of 10,000 jobs, according to the study.

For every $10 spent on accommodation, guests spent an additional $50 on tourism-related activities in local communities, including transportation, cafes, restaurants, and entertainment.

While the platform’s absolute revenue figures for the region were not disclosed, Powell said that in 2022 Airbnb recorded growth in both that indicator and guest arrivals, with a 30% increase in spending compared to 2021.