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Airbnb Hosts Skirt Rules To Book Guests Outside Platform: Financial Times

Airbnb Hosts Skirt Rules To Book Guests Outside Platform: Financial Times

Airbnb hosts are skirting the platform's rules to book more customers at their properties privately, rather than through Airbnb.

What Happened: More and more Airbnb Inc (NASDAQ: ABNB) hosts are bending or breaking Airbnb's rules and treating the platform as a marketing tool for their private properties, the Financial Times has reported.

Hosts are getting bolder to make up for lost revenue. The pandemic hit hosts hard, as they had to comply with Airbnb’s decision to offer refunds for already booked listings when the COVID-19 pandemic swept the world.

“I have a little bit of PTSD. [The pandemic refunds] really kind of smacked us in the face. Airbnb said everyone can have free cancellations without penalty. It was definitely the scariest time in our business, we weren’t sure if we would survive,” FT quoted one host as saying.

According to Airbnb’s policies, hosts are prohibited from gathering personal information such as emails about their guests.

One way hosts get around this is to use so-called online “guidebooks,” according to FT. To get access to this guidebook, guests have to sign up using an email address. Hosts then are able to reach the clients directly and offer their private properties outside the platform.

Why It Matters: How many clients come back and book again on the platform is one of the metrics Airbnb investors are looking into, the FT notes.

In 2019, 69% of the rental platform's customers were repeat guests, according to a company financial filing.

This matters to investors who ran up the stock price a month ago when the company went public. When Airbnb went public on Dec. 10, its share price jumped 135%, to as high as $160 per share after opening at $68, NPR has reported. Its stock went down 25% in the next couple of days.

Price Action: Airbnb stock closed at $149.77 on Friday, down 0.99%.

It traded 0.25% lower, at 149.40, in the after-hours trading.

Image: WikiCommons


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