Airbnb is hoping Chinese tourists and millennials will help its accommodation letting platform to become profitable for the first time this year, according to The Financial Times (FT).
The company’s chief technology officer and cofounder, Nathan Blecharczyk, told the FT that Airbnb is focusing on China after demand in the country increased eightfold last year.
“We’ve done focus groups and a lot of Chinese travellers are going abroad for the first or second time,” he said. “There is no preconceived notion of whether [staying in hotels or with Airbnb] is better … That’s what makes China such a great opportunity.”
Airbnb, which takes a 6-12% cut from guests and charges hosts 3% for complete bookings, is valued at $25.5 billion (£17.9 billion) but the San Francisco-headquartered company still isn’t profitable. The eight-year-old business was forecasting an operating loss of $150 million (£99.5 million) for 2015, according to a Wall Street Journal report last June.
Blecharczyk said Airbnb has seen a 700% increase in China year-on-year, which is apparently “huge” by Airbnb’s own standards. It’s unclear whether Blecharczyk was referring to profits, revenues, property listings, or another metric.
Chinese outbound tourism consumption climbed to over $102 billion (£71 billion) in 2012, ranking it number one in the world.
Airbnb saw 35 million bookings made over its platform last year, according to Blecharczyk. Europe is one of its largest markets, with over half of all Airbnb’s property listings hailing from the continent.
Another market being chased by Airbnb is the millennial market. “The millennial generation has a smartphone and is very independent,” said Blecharczyk. “They want to meet new people. They want to take selfies with them. It’s a very different mentality to travel.”
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