Revenue Management Practices in Peer-to-Peer Accommodation: The Case of Airbnb

Kiczmachowska, Ewa

Abstract

Purpose: Revenue management (RM) practices are well established in the hotel industry. Peer-to-peer (P2P) accommodation is a distinctive alternative to hotels, which in its original intention, is managed by non-professionals. The main research question of this study was how the professionalism of P2P accommodation providers relate to their use of RM practices.

Research method: I performed statistical analysis of 479,282 pricing records for 25,827 properties offered through Airbnb in the period of 67 months (August 2015 – February 2021) in Poland. Two indicators of hosts’ professionalism (the number of properties they manage and the possession of superhost status) were tested against three RM practices (cancellation policy, minimum stay, and dynamic pricing).

Findings: This study clearly showed the intensification of P2P hosts’ professionalization in comparison to previous research. Moreover, it proved that professional and non-professional hosts’ behaviors significantly differ when it comes to RM practices application, but the discrepancies are not equally distinctive. The finding that brought a considerably different result in comparison to previous research was the negative relationship between a multi-unit host and minimum stay.

Implications and future research: This study should serve as a warning for hoteliers about the P2P hosts’ professionalization, as they become equal competitors. There are several future extensions to this study, including holiday destinations, testing other than hosts’ professionalism variables, or shedding light on the evolution of RM practices application could reveal valuable insights.

Originality: This study contributes to the existing research by offering the analysis of very recent longitudinal data and covering professional vs. non-professional P2P hosts’ behaviors in terms of three RM practices in Central-Eastern Europe settings.

Keywords

revenue management (1)peer-to-peer accommodation (1)Airbnb (1)dynamic pricing (1)

References

Airbnb (2021a). Cancellation policies. Obtained from: https://www.airbnb.pl/help/article/475/jak-wybra%C4%87-zasady-anulowania-mojej-oferty (access: 16.03.2021). [Google Scholar]
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Chen, Y. and Xie, K.L. (2017). Consumer valuation of Airbnb listings: a hedonic pricing approach. International Journal of Contemporary Hospitality Management, 29(9), 2405–2424. http://dx.doi.org/10.1108/IJCHM-10-2016-0606, [Google Scholar]
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APA style

Kiczmachowska, Ewa (2022). Revenue Management Practices in Peer-to-Peer Accommodation: The Case of Airbnb. (2022). Revenue Management Practices in Peer-to-Peer Accommodation: The Case of Airbnb. Central European Management Journal, 30(2), 135-152. https://doi.org/10.7206/cemj.2658-0845.78 (Original work published 6/2022AD)

MLA style

Kiczmachowska, Ewa. “Revenue Management Practices In Peer-To-Peer Accommodation: The Case Of Airbnb”. 6/2022AD. Central European Management Journal, vol. 30, no. 2, 2022, pp. 135-152.

Chicago style

Kiczmachowska, Ewa. “Revenue Management Practices In Peer-To-Peer Accommodation: The Case Of Airbnb”. Central European Management Journal, Central European Management Journal, 30, no. 2 (2022): 135-152. doi:10.7206/cemj.2658-0845.78.

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[1] Airbnb (2021a). Cancellation policies. Obtained from: https://www.airbnb.pl/help/article/475/jak-wybra%C4%87-zasady-anulowania-mojej-oferty (access: 16.03.2021). [Google Scholar]

[2] Airbnb (2021b). Superhost. Obtained from: https://www.airbnb.com/d/superhost (access: 17.03.2021). [Google Scholar]

[3] AirDNA (2021). About AirDNA. Obtained from: https://www.airdna.co/about (access: 22.04.2021). [Google Scholar]

[4] Belarmino, A. and Koh, Y. (2020). A critical review of research regarding peer-to-peer accommodations. International Journal of Hospitality Management, 84(June). http://dx.doi.org/10.1016/j.ijhm.2019.05.011. [Google Scholar]

[5] Chen, Y. and Xie, K.L. (2017). Consumer valuation of Airbnb listings: a hedonic pricing approach. International Journal of Contemporary Hospitality Management, 29(9), 2405–2424. http://dx.doi.org/10.1108/IJCHM-10-2016-0606, [Google Scholar]

[6] Gibbs, C., Guttentag, D., Gretzel, U., Yao, L., and Morton, J. (2018). Use of dynamic pricing strategies by Airbnb hosts. International Journal of Contemporary Hospitality Management, 30(1), 2–20. http://dx.doi.org/10.1108/IJCHM-09-2016-0540. [Google Scholar]

[7] Hossain, M. (2020). Sharing economy: A comprehensive literature review. International Journal of Hospitality Management, 87(February). http://dx.doi.org/10.1016/j.ijhm.2020.102470 [Google Scholar]

[8] Koh, Y., Belarmino, A., and Kim, M.G. (2020). Good fences make good revenue: An examination of revenue management practices at peer-to-peer accommodations. Tourism Economics, 26(7), 1108–1128. http://dx.doi.org/10.1177/1354816619867579. [Google Scholar]

[9] Kreeger, J.C. and Smith, S. (2017). Amateur innkeepers utilization of minimum length stay restrictions. International Journal of Contemporary Hospitality Management, 29(9), 2483–2496. http://dx.doi.org/10.1108/IJCHM-09-2016-0502 [Google Scholar]

[10] Kwok, L. and Xie, K. L. (2019). Pricing strategies on Airbnb: Are multi-unit hosts revenue pros? International Journal of Hospitality Management, 82(April 2018), 252–259. http://dx.doi.org/10.1016/j.ijhm.2018.09.013 [Google Scholar]

[11] Li, J., Moreno, A., and Zhang, D. (2016). Pros vs Joes: Agent Pricing Behavior in the Sharing Economy. Ross School of Business Paper No. 1298. [Google Scholar]

[12] Narasimhan, C., Papatla, P., Jiang, B., Kopalle, P.K., Messinger, P.R., Moorthy, S., Proserpio, D., Subramanian, U., Wu, C., and Zhu, T. (2018). Sharing Economy: Review of Current Research and Future Directions. Customer Needs and Solutions, 5(1–2), 93–106. http://dx.doi.org/10.1007/s40547-017-0079-6. [Google Scholar]

[13] Oskam, J., van der Rest, J.-P., and Telkamp, B. (2018). What’s mine is yours—but at what price? Dynamic pricing behavior as an indicator of Airbnb host professionalization. Journal of Revenue and Pricing Management, 17(5), 311–328. http://dx.doi.org/10.1057/s41272-018-00157-3. [Google Scholar]

[14] Pawlicz, A. (2019). Ekonomia współdzielenia na rynku usług hotelarskich. Niedoskonałości. Pośrednicy. Regulacje. Szczecin: Wydawnictwo Naukowe Uniwersytetu Szczecińskiego. [Google Scholar]

[15] Stephany, A. (2015). The Business of Sharing: Making It in the New Sharing Economy. London: Palgrave Macmillan. http://dx.doi.org/10.1057/9781137376183 [Google Scholar]

[16] Sundararajan, A. (2016). The Sharing Economy: The End of Employment and the Rise of Crowd-Based Capitalism. London: The MIT Press. [Google Scholar]

[17] Sztokfisz, B. (2018). Rynki peer-to-peer jako współczesny przejaw wolności gospodarczej. Studia Ekonomiczne, 349, 232–242 [Google Scholar]

[18] Talluri, K. and van Ryzin, G. (2005). The Theory and Practice of Revenue Management. New York: Springer Science & Business Media. http://dx.doi.org/10.1007/b139000. [Google Scholar]

[19] Tranter, K., Stuart-Hill, T., and Parker, J. (2014). An Introduction to Revenue Management for the Hospitality Industry: Principles and Practices for the Real World. New York: Pearson, Prentice Hall. [Google Scholar]

[20] Vives, A., Jacob, M., and Payeras, M. (2018). Revenue management and price optimization techniques in the hotel sector: A critical literature review. Tourism economics, 24(6), 720–752. http://dx.doi.org/10.1177/1354816618777590. [Google Scholar]

[21] Wu, E.A.A. (2016). Learning in peer-to-peer markets: evidence from Airbnb, Master thesis, Fundac to Gueulio Vargas. Obtained from: http://sistema.bibliotecas.fgv.br/ (access: 23.05.2021). [Google Scholar]

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