The hotel and lodging industry used to be very straightforward and stagnant as a whole – hotels and motels hosted the majority of travelers and tourists in their professional, (hopefully) daily cleaned rooms. Of course, there are also hostels, boarding houses and inns. Ever since our country was founded there have been boarding houses and inns. Over time, this grew and developed into larger boarding houses, hostels, and, ultimately, hotels and hotel chains. These chains are now spread globally and the largest of them have lodging available in approximately 80 different countries.
For the past couple of decades, it has b een all about the big hotel chains. Airbnb was founded only 8 years ago and in that short time has single-handedly and fundamentally changed the industry, albeit slowly. No longer do tourists and those on the road have to look strictly between hotel chains for the best deal. Nowadays, using Airbnb, they can rent out someone’s lived in and homely apartment (or even home) for a night, a week, or even a month or longer.
The company has been labeled a “disruption” to an industry where technology and innovation have been slow-moving. In the past, when traveling to a new city or country, the most reliable options were either a hotel, a hostel, or an inn, depending on where you’re going. 30 years ago, travelers would call and make arrangements. In the last 10 years, nearly all lodging booking is done online through hotel or room comparing websites. Hotel chains got bigger and expanded further and further. You’d be hard pressed to drive through a city and not find more Marriotts or Red Roof Inns than you could count on one hand. They’re everywhere.
But now, with Airbnb, the apartment complex down the street might be equally available, and even possibly cheaper to rent. Although Airbnb has begun to pick up steam, it is still not widely used. For example, travel agencies still exist in the same capacity that they always have – booking transportation, destinations, and lodging. Yet, from my own personal experience, I have never dealt with a travel agent who will recommend staying somewhere found on Airbnb. Yet.
These large hotel chains – such as Hilton, Holiday Inn, etc. – have been around for anywhere from 50-75 years as of today and are still doing as great of business as ever. One thing that is interesting to note, however, is the rate with which the average price of a hotel room in the U.S. has increased in the last 15 years. According to Statista, in 2001, the average price for a hotel room was $83.62. Today it is over $120 for your run-of-the-mill room in any medium or large-sized chain.
In the past 50 years, the lodging industry, like most other industries still around today, has evolved and grown with the Internet, making it easier for businesses to reach a global customer base and find the necessary lodging in a short amount of time. It’s an industry that is very entrenched in its ways and run by large corporations who have perfected their business models to a tee. Airbnb has shown signs of disruption in the market, but it is going to take quite some time for us to see the effects.