Airbnb executives talk a lot about doing less performance marketing (think buying Google search ads) to focus on brand marketing (think Subway is announcing the company's new "OMG" real estate class). How much do they spend on it?
The short-term rental giant spent $202 million on brand marketing campaigns in the first nine months of the year, according to financial reports released Thursday and earlier this year.
Brand marketing is critical to a company's ability to reach guests and hosts through direct, free channels, which executives say are cheaper than advertising on Google, Facebook and other channels. One campaign centered around OMG's real estate department and included a $10 million prize for potential hosts (after the end of the third quarter). The list has amassed more than 300 million views since the category was launched, according to the company.
Promote customer incentives?
In addition, the company has been paying customers through referral programs for many years. Airbnb usually offers credit for future bookings after someone recommends an online agency and that new guest completes their first stay.
The company did not specify how much it would spend on the stimulus program. You often receive refunds in addition to what you give to customers who are unhappy that something went wrong with their Airbnb experience.
Interestingly, overall customer payments for promotions and discounts have increased this year. In the comparable third quarters of 2020 and 2021, Airbnb kept those amounts around $85 million. But in the third quarter of 2022, the total incentive payouts and payouts increased to $152 million. It was 78% higher.
Have payments increased with the end of the pandemic? This seems unlikely. Instead, the company appears to have increased referrals and other marketing programs, for example. B. where it offers coupons.
Energy credit for UK hosts?
On Thursday, the company launched another brand promotion program. In the UK, Airbnb is the first to launch a sustainable housing fund of around $1.1 million (£1 million) to help property managers looking to make their homes more energy efficient.
Many hosts are struggling with rising UK electricity prices as Russia shuts off power to Europe during the war with Ukraine.
Airbnb rewards are around $3,300 (£3,000). Acceptable measures include more energy efficient boilers or heat pumps and replacing roof insulation. See the Corporate Sustainability Fund website for details.
Overall, Airbnb seems to have found that pay-for-performance marketing is better than other forms of marketing for targeted customer segments. To learn more, watch Airbnb co-founder and CEO Brian Chesky explain the company's strategy in this video from the Skift Global Forum 2022.
