Category: Travel

Airbnb’s Financial Dip: Will June Mark the Rebound?

Posted on by Drop

Our Q1 Spending Report that we shared earlier this year showed that overall spend was down in every sector except for travel compared to last year. The basket size in the travel sector increased 4% whereas the transaction volume was relatively flat showcasing the inflation of travel prices. The rising travel costs are concerning consumers and highlighting the importance for travel organizations to strategize price points and provide additional value where possible. Airbnb experienced a financial dip due to these recent economic uncertainties and strong competition, but could June be the month to bounce back? Read on to find out!

Spending in the travel sector has increased compared to last year, but more so due to inflated prices rather than vacation volume as travelers are concerned about rising costs. 

Drop’s card linked offers platform enables us to capture real-time consumer insights through surveys like our most recent one on the travel accommodation space. Of the market research survey respondents, 68% are concerned about the rising travel costs impacting their ability to take leisure trips. Inflated travel prices are the top reason contributing to the ease of travel among US vacationers (75% of respondents) and lingering health and safety concerns are also still playing a role post pandemic (30% of respondents). Staycations and localized traveling have become a more popular option in recent times (46% of respondents) providing low and transparent prices which are at least moderately important for 69% and 86% of survey respondents respectively. Demand for low prices and localized traveling should be a market well suited to travel organizations like Airbnb, but a recent financial dip could be due to strong competitors who are able to provide better value.

Concern About the Rising Travel Costs Bar Graph.

With the increased importance of price points and loyalty programs, Airbnb has strong competitors which are enticing alternatives for travelers. 

When asked about alternatives to Airbnb, the stand out option is VRBO for 74% of survey respondents. The company operates in a similar fashion to Airbnb but typically offers lower prices for the same accommodation and has superior customer service. VRBO experienced a similar financial dip to Airbnb recently but is set to launch its loyalty program ‘One Key’ in early July, hoping to provide even more value to their travelers in exchange for reliable commitment. After VRBO, traditional hotels are the most preferred alternative for 55% of respondents. This is primarily due to the features unique to a hotel experience like amenities and services but also the loyalty programs and rewards points that many hotels offer. With price points and loyalty programs continuing as top priorities to travelers, VRBO and many hotels look to be in a better position compared to Airbnb. 

Most Preferred Airbnb Alternatives - VRBO, Traditional Hotels, HomeAway, and Couchsurfing.

Despite economic uncertainties and strong competition, Airbnb looks to be bouncing back in June with its highest stock price since early February. 

The Airbnb stock price fell 21% from May 9th – 12th and this financial dip is reflected in the survey results as only 9% of the survey respondents are likely to invest in Airbnb’s stock. The economic uncertainties are affecting many organizations in the travel sector, and 56% of the respondents believe Airbnb is being at least moderately affected during this ease of US travel. It also doesn’t look to be getting any easier for Airbnb, as 44% of the respondents are likely to use hotels more frequently in the future instead. The odds look to be against Airbnb at this moment in time with the economic uncertainties and strong competitors in the industry, but despite all of this Airbnb could be bouncing back this month as their stock price is the highest it has been since early February. Focussing on their homier feel, evolving where possible, and optimizing their price points will be imperative to keep this momentum going. 

Airbnb Stock Price 2023.

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    Sentiment towards Southwest and airline influential factors in 2023

    Posted on by Drop

    After a holiday season of increased cancellations and delays in late 2022, Southwest is trying to bolster its brand by promising to make good on inconveniences incurred by customers. CEO, Bob Jordan has pledged to “do better” and as a part of this promise, there are rumors that the company is planning to improve their infamous boarding process. 

    Drop surveyed 500+ members to gain consumer insights into the US airline industry:

    What is consumer sentiment towards Southwest Airlines and their top competitors? What impact can Southwest Airlines expect by improving their boarding process? Does the boarding process rank in the top factors that influence consumers?

    Despite 16,700 flight cancellations and severe delays during the 2022 December holidays, Southwest prevails as the top US airline amongst Drop survey respondents:

    Sentiment towards Southwest Airlines. 74% Satisfied with past Southwest experiences 78% Likely to fly Southwest in the future 43% Preferred Southwest to its competitors 15% Difference in preference between Southwest and second-place Delta Drop Insights Solutions, Feb. 3, 2023, 528 US respondents.

    The proposed improvement to Southwest’s boarding process would increase the age of children in the ‘Family Boarding Group’ from 6 and under to 13 and under. 

    When Drop survey respondents were asked how this change would impact their sentiment towards Southwest the results were not positive, and it would be unwise for Southwest to introduce this rumored ‘improvement’:

    Sentiment on the Southwest boarding process. 24% Less likely to fly Southwest with proposed boarding process changes 35% Southwest’s boarding process is better than their competitors 32% Boarding process doesn’t impact which airline they chose Drop Insights Solutions, Feb. 3, 2023, 528 US respondents.

    If it ain’t broke don’t fix it, and based on the example above, the boarding process doesn’t look to be a place for impactful wins. There are many other factors that have a much greater impact on which airline consumers are choosing. 

    The most important factor is the price which comes as no surprise in the current climate. 


    Just under 75% of respondents selected price as having the biggest impact on selecting an airline which was the highest factor by 13%. In order to compete with discounted industry pricing in January, Southwest will have no choice but to also offer low-fee fares despite facing a large cost of up to $825M due to the December holiday cancellations.

    Want to gain a deeper understanding of your industry that can give you a competitive edge? Check out Drop Market Research, and gain valuable insights with the help of market research surveys into your target audience and start making informed business decisions.