Booking Holdings CEO Glenn Fogel expressed disappointment in Booking.com’s U.S. short-term rental portfolio during a recent earnings call, stating that the company’s offerings are not as competitive as they need to be. Despite having 7.8 million short-term rental listings globally, Booking.com still lacks the quantity and quality of accommodations in the U.S. to fully compete with companies like Airbnb. Fogel acknowledged that Booking.com has not reached the same level as Airbnb in terms of U.S. supply and is not willing to spend a significant amount of money on a subpar product.
One specific example Fogel mentioned was the lack of short-term rentals available in The Hamptons, a popular vacation destination in Long Island, New York. He noted that there are likely more listings on Airbnb and Vrbo compared to Booking.com, and he expressed a desire to improve the company’s presence in the area. Fogel emphasized the importance of making it easier for customers to find and book rentals on Booking.com, positioning the platform as a better option for securing summer rentals. Although Booking.com has made progress in its alternative accommodations business globally, the U.S. market remains a challenge for the company.
Booking.com officials believe that their unique value proposition lies in offering a mix of hotels and short-term rentals, unlike competitors like Airbnb and Vrbo, which primarily focus on apartments and vacation rentals. This combination allows Booking.com to cater to a wider range of travelers and offer a more diverse selection of accommodations. While Airbnb declined to comment on Booking.com’s short-term rental business or Fogel’s statements, it is clear that the competition between the two companies is heating up in the alternative accommodations sector.
Despite the challenges in the U.S. market, Booking.com reported growth in its alternative accommodations business during the second quarter, with short-term rentals accounting for 36% of its accommodations bookings. This increase in room nights and bookings demonstrates a growing demand for alternative accommodations among travelers. However, Booking.com still has work to do to catch up with the likes of Airbnb in the U.S. market and establish itself as a leading provider of short-term rentals in popular vacation destinations.
Moving forward, Booking.com will need to focus on building relationships with individual hosts in addition to property managers to expand its U.S. supply of short-term rentals. This shift may require more effort and resources, but it is crucial for Booking.com to enhance its competitiveness in the market. By improving its presence in key vacation destinations like The Hamptons and offering a diverse selection of accommodations, Booking.com can attract more customers and increase its market share in the U.S. alternative accommodations sector. Fogel’s remarks underscore the company’s commitment to addressing these challenges and enhancing its offerings to meet the evolving needs of travelers.
