Airbnb turns the tourism industry around
Airbnb celebrated its tenth anniversary in early August. When Airbnb started ten years ago, many found the idea of staying in private lodgings of strangers crazy and predicted that this idea would never work. Today – ten years later – more than 5 million Airbnb hosts offer their accommodation for rent. Hosts around the world have welcomed more than 300 million guests in more than 81,000 cities and from 191 countries.
10 years Airbnb
The Airbnb community currently offers over 5 million homes – guests from all over the world can feel at home in every single one of them. To date, Airbnb hosts have welcomed more than 300 million guests in more than 81,000 cities and 191 countries. On the weekend of August 11-12, 2018, a usually quite ordinary weekend in August, Airbnb arranged accommodation for more than 3.5 million guests – a new record.
It would be too easy to imagine the first Airbnb visit as a simple overnight stay. It was also an experience. From day one, Airbnb has concentrated on arranging private accommodation as an introduction to a holistic travel experience. The Airbnb founders not only shared their own house on Rausch Street in San Francisco, USA but also shared their favorite, lesser known and truly authentic places in San Francisco with their first three guests.
That’s why Airbnb officially introduced the concept of “magical” experiences designed by local people in November 2016 and made them bookable on its platform: from pasta production in Tuscany to surfing in Hawaii.
Airbnb is just the beginning: The sharing economy is booming!
The sharing economy seems to be getting stronger and stronger. The prime example of sharing – Airbnb – already had a company value of more than 10 billion dollars in 2014; that was just 6 years after the company was founded! This has led the technology magazine “Fast Company” to suspect that Airbnb “would take over the InterContinental Hotels Group and Hilton Worldwide as the largest hotel chain in the world – without owning a single hotel”.
So what should a hotel chain do to respond to the threat of the sharing economy? Christopher Norton, EVP at Four Seasons believes that her customers expect “a different, more demanding, personal and better service”. Richard Solomons, a former CEO of the Intercontinental Hotels Group, sees it as a question of trust and security. “We are trusted because we are highly regulated. When we open a hotel, we have food controls, security, a building that’s safe; if there’s a fire in an Airbnb, you have no idea what to do.” (Source: Fast Company)
However, the attention of the media around Airbnb continues to grow. The Sharing Economy has managed to skilfully marginalize established brands. If they try to criticize the business model of the sharing economy, they run the risk of looking like dinosaurs that don’t keep pace with the hip new economy.
Is Airbnb the Amazon of the tourism industry?
Digitalization is making the platform economy even more relevant. Companies such as Uber and Airbnb are transforming entire sectors such as the taxi and tourism industries and replacing established top dogs.
Airbnb strategy is based on the platform economy
Airbnb shows how the platform economy works: Airbnb is now similar in size to the Marriott Hotel Group (in terms of market value). However, unlike Marriott, Airbnb does not require any real estate, hotels or very few own staff. Airbnb’s strength is to efficiently bring suppliers and interested parties together on its platform. Airbnb charges both providers and overnight guests a commission for the use of the platform.
Stylish ambience in the luxury apartments of Le Bijou. Photo: Le Bijou HRM AG
The next step: Le Bijou – Airbnb 2.0
Madeleine Fallegger and her partner Alexander Hübner had the business idea for Le Bijou because of Airbnb’s boom. The two rent vacant luxury apartments, convert them, and then rent them out to business people and wealthy tourists from all over the world. Le Bijou grew up thanks to Airbnb.
“We would not have made it without the Internet booking platform,” says Alexander Hübner, CEO of Le Bijou. “It made people realize that instead of staying in a hotel, you can stay in private. That helped us a lot.”
For wealthy tourists and business people
Le Bijou is the alternative to the luxury hotel, says Alexander Hübner: “You have a luxurious ambiance that you don’t have to share with other guests. We say: ‘Hotel service without the other hotel guests’. This is something that is now being sought. People would rather feel like local residents than be in a large hotel infrastructure.”
The apartments are offered on online platforms such as Airbnb, Booking or Expedia. “We see ourselves as the middle ground between Airbnb and luxury hotel,” says Madeleine Fallegger, CSO of Le Bijou. She is prepared for the question of whether this will deprive the market of living space. “Some of the properties we rent had been vacant for months.”
Le Bijou grows sustainably
According to Fallegger, the start-up Le Bijou now manages around 30 furnished apartments in Zurich, Zug, Lucerne, Basel and Berne. Geneva is due to join soon. The offer also includes a “digital butler”: an app that can be used to book additional services such as food, taxi rides, clothes washing or massages. The providers are not employees, but self-employed or established companies. The food is delivered by restaurants in the vicinity of the respective apartments.
The overnight stay as an experience
We rent out our own apartments, whereas Airbnb is only an intermediary platform between landlord and tenant. In addition, our customers know what they get from us: an apartment in a top location, with exquisite furnishings and first-class service. Our guests communicate with James, a virtual concierge. This is our proprietary software, which is equipped with artificial intelligence and offers all services. That beats the service of a 5-star hotel. A stay in Le Bijou Apartment is an experience.
Personalization increases customer satisfaction and loyalty
Every stay is individual – from the restaurant or event recommendations to the food and drinks we can provide for an apartment to the services we offer. Everything is tailored to a particular guest and how he wants to experience Le Bijou. And it seems to be working: Apple co-founder Steve Wozniak has named us the “most elegant, most personal hotel in the world”, and this is a man who lives in over 100 hotels every year!
Steve Wozniak about Le Bijou:
Sounds good – but what are the benefits for investors?
The unique thing about Le Bijou
Le Bijou is the first company to digitize the high-end hotel sector. Le Bijou combines proven and already successful elements from other revolutionary concepts such as Airbnb with a completely new kind of travel comfort. The innovative apartment concepts and groundbreaking service software James make Le Bijou an attractive hotel alternative.
The Le Bijou concept is easy to scale – and with it the profit!
Le Bijou works at every hip location in the world. The brand can be easily adapted to local conditions and can also expand strongly with franchise-like models. In order to establish new flagship projects of Le Bijou in top locations and to increase brand awareness, Le Bijou is further expanding its network in strategic locations and in top locations.
Personalization increases customer loyalty and increases capacity utilization
Whatever a guest may desire: Le Bijou fulfills every wish. All apartments have James, a digital butler who can provide tailor-made recommendations, book services such as meals or transfers and even change the music, lighting, and ambiance of the apartment. This innovative technology learns from interaction with guests and ensures that each stay is perfectly tailored to individual needs.
We examine each destination very closely for its growth potential and can bring additional units onto the market within a short period of time if required. This approach has two decisive advantages: market leadership at the respective location and secure price control. This form of market coverage also means lower risk for investors.
Photos of selected Le Bijou Apartments: