Turbulent markets often contain investment opportunities that bring huge returns, just as Airbnb and Uber were both born in the depression in 2008.
In 2008, Chesky and Gebbia got inspiration from an accident of airbed and breakfast and founded a company called "Airbnb " .
Airbnb entered the Chinese market in 2015. Since then, China has rapidly grown into an important pole in Airbnb's global market. The epidemic hit in 2020. At that time, the domestic control situation was relatively good, and China once became Airbnb's largest order market.
On December 10, 2020, Airbnb was listed on Nasdaq in the United States. On the first day of listing, Airbnb opened at US$68 a share, and closed at US$144.71 a share, a 113% increase from the issue price, with a market value of more than US$86.4 billion. It exceeds the sum of Marriott Hotels, Hilton Hotels and Hyatt Hotels, and also exceeds the market value of the travel giant Booking.
From 2008 to 2020, a listed homestay company emerged in the United States. China's homestay industry officially started in 2011, and now it is about to enter its 12th year. Is the soil for the development of China's homestay industry still there? Has the homestay reached the final struggle before the graduation season? Tujia, Muniao, Meituan, and Xiaozhu, who will succeed Airbnb and take the top spot in B&B?
China has homestay market and cultural soil for sharing
The core model of the homestay is called "accompanying young people to grow up". In the development process of Airbnb, there are very clear characteristics about the mainstream consumer groups.
The earliest users of Airbnb were those born in the 1980s and 1990s. They flaunted their individuality with Airbnb, advocating the "backpacker" life concept of being brave to try, being independent, and leaving as soon as they say it. These people became the earliest loyal users of Airbnb.
In 2019, Bo Siqi said in a speech at Tsinghua University: "There are more than 400 million millennials in China, and they are the main force of Airbnb users, and they are the top priority of our business development."
From the post-80s to post-00s, China's homestay consumption has always focused on young people.
According to the 2021 annual data report of Wooden Bird B&B, users aged 18-24 accounted for 46%, users aged 25-29 accounted for 29%, post-90s and post-00s accounted for 75% of the total, and Z-generation users became homestay consumers. main group.
Do young people really like homestays? In other words, what is the attraction of homestays?
After staying in a hotel and a B&B, you will most likely feel that there is a big difference between a B&B and a hotel.
Generally, hotels usually have a lot of rooms, such as double-bed rooms, standard rooms, uniform decoration, and long corridors. B&Bs are completely different. The biggest feature of B&Bs is the individuality of the listings, and there is no stereotyped decoration and layout. "Cheap", "distinctive layout" and "human touch" are the main reasons why young travelers choose homestays. In a homestay, the landlord is more willing to show his "landlord friendship" and entertain friends from afar. Break the simple "accommodation" mode and provide a novel and scene-based lifestyle experience.
This kind of experiential marketing is specially designed for young people.
In the book "Future Shock", American "futurist" Toffler once predicted that the experience economy will surpass the service industry and become the next economic form after the service economy.
Homestays have already played out experiential marketing.
Users stay in homestays no longer just to meet a single accommodation need, but based on emotional needs, and even the expectation of "I want this kind of life too". Today, as consumption upgrades and individual needs continue to increase, they will substitute their own emotions and expectations into it, reflecting the cognition and yearning of this generation for a certain lifestyle and attitude towards life. It contains a certain emotion of people.
This is not only a business, but also a grasp of human nature.
As for whether young people have spending power, it may be worth another article. But just judging from the endless new consumer brands that have emerged in recent years, each company is already keeping a close eye on the wool of young people. So, the answer seems self-evident.
misjudged track
According to a report from Blue Whale Finance and Economics, in the homestay industry in the past ten years, domestic independent homestay platforms have invested a total of about 10.3 billion yuan, and the return may be less than one-third.
On the one hand, the lower-than-expected revenue is related to changes in the external environment. The counterattack of the epidemic has stalled many homestay supply chains, including platform players. Homestay platforms such as Tujia, Meituan, and Xiaozhu have almost failed to rely on strong exposure of advertisements to obtain traffic, and the front line of homestay growth has been stretched. Wooden Bird B&B publicly stated that since the date of establishment, the total investment cost has not exceeded 100 million yuan, which is a very cautious figure compared with other platforms. Perhaps this is also the best interpretation of the supply chain of the homestay industry that has just touched 2 million homestay listings in the past ten years of burning money. B&B is not an industry that can expand rapidly.
The crazy money-burning customer acquisition battle has actually come to an end. The homestay platform, which is obsessed with speed, has begun to gradually direct the war to focus on products and operations. At the same time, affected by the epidemic, after the supply chain exceeds 2 million sets, the platform should have followed the product to cultivate user consumption habits, and the time node for achieving scale effect has been greatly delayed.
On the other hand, to a certain extent, capital has misjudged the homestay industry to a certain extent. First of all, some capital wrongly estimated the development stage of the homestay industry. B&B is an industry that focuses on operations. Looking at the comparison between Didi and Muniao, which have been established for ten years, Didi announced that the number of platform drivers exceeded 16 million as early as 2016, and the number of listings in Muniao B&B in 2021 just exceeded 1.35 million. , to use an image metaphor , the ice in the homestay industry has not long since melted, and it is in the growth stage of a small fire turning into a big fire. If we look at the 6 million listings around the world when Airbnb went public, in the next ten years, China's homestay industry will show a trend of accelerated development.
Secondly, the real scale of the homestay market may be far larger than imagined. The previous "China Shared Accommodation Development Report" showed that the number of major domestic shared accommodation houses accounted for only about 3%, far lower than the 20% market share in Europe and the United States. The epidemic has triggered frugality in the homestay industry, which means that a new round of long-distance running has begun. But this time, steady cash flow and independent hematopoietic ability may become the key to victory. Whether the independently operated Wooden Bird B&B can seize this advantage and lead a development position. The scale of the market is infinite, and only after the scale is large will large-scale profits be made . Although the overall revenue of homestays has slowed down since the epidemic, the market is slowly becoming bigger and bigger.
Huang Yue, CEO of Wooden Bird Homestay, mentioned in a recent interview: "The domestic homestay industry started from a "freezing point", and it took ten years to enter the "warm point" to find a new development path and gradually mature." For homestays that arrive at hotspots, the best sincerity is to take your time.
As the competition began to enter the stage of giants, the capital gradually calmed down, and the stage of completely burning money for shares was over. When the price no longer has a huge advantage, consumers' sensitivity to products and operations is highlighted, and the main battlefield of competition begins to shift from marketing exposure to products, prices and services. The real advantages of the homestay platform also exploded.
So, who will be in charge of the future Chinese homestay?
User traffic, profitability, cash flow, and development potential are the key.
First, grab C-end users.
After the scale effect of the listings has been formed, the focus of the platform's efforts is actually on the competition for C-end traffic.
There are not many "absolute new additions to housing listings" that major platforms have won from Airbnb China. According to Ms. Miao (pseudonym), the landlord of Wooden Bird B&B, her B&B was launched on Airbnb, Tujia, Wooden Bird, and Meituan at the same time. Judging from Ms. Miao’s sales in the past week, the user channels accounted for: Wooden Bird 46 listings>Airbnb 39 listings>Meituan 16 listings>Tujia 7 listings>WeChat 6 listings>Ctrip 2 listings. Although Muniao has been confirmed as the main sales platform, listings on other platforms are still being maintained. Now that the channel of Airbnb China has disappeared, whoever can capture the C-end users is the winner.
This returns to the essence of user traffic. Simply put, whoever has more downloads is more popular with users. At this point, only Wooden Bird Homestay is the only one that really enjoys user bonuses, followed by Tujia.
Second, the homestay industry maintains stability and has a bright future.
Profitability determines whether an enterprise is excellent, while cash flow is the key to determining whether an enterprise can survive, and is the core of value creation. The performance of cash flow lies in the hematopoietic ability.
Although due to the impact of the epidemic, the effect of Tujia and Xiaozhu relying on external platforms of Ctrip and Fliggy for blood transfusion has weakened, Wooden Bird B&B has obtained 80% of its own traffic through new media channels, and Meituan B&B has accelerated to catch up through the entry of local life traffic. Overall, the general tone of homestay development has not changed.
In addition, with the adjustment of the superimposed circuit breaker mechanism, the unfavorable factors of the epidemic have weakened, and the policy support for the sinking market will further benefit the homestay industry.
But for Tujia and Xiaozhu, it is necessary to settle inside first. The interruption of external blood transfusions actually sounded the alarm. A company that relies on blood transfusions will not live long, the key is to make blood itself.
Third, long-termism and capital optimism
Although domestic homestays have become popular, compared with Airbnb’s financing amount of more than 6 million RMB, they are still in the early stage of development, and only long-termism can achieve long-term success.
With the end of the epidemic, domestic homestays will also usher in new growth. Early investors and long-term companions in the homestay industry will gain a lot.
Uber (Uber) went public in 2019, and the return rate of early investors was close to 5,000 times. In summary, who can provide more profit margins for domestic homestay platforms?
According to Qichacha, Tujia Homestay completed the E round of financing in 2017; Xiaozhu Homestay completed the F round of financing in 2018; Wooden Bird Homestay completed the B+ round of financing in 2019. There is not much time left for capital.
The cold winter of capital and the track of homestays may not be the reincarnation of the times. It seems that the graduation season of the homestay may still be far away.
Where is the next new continent?
In fact, just as Taobao defeated eBay, it did not steal eBay's customers, but from new customers. Interesting e-commerce companies such as Xiaohongshu and Kuaishou Douyin stand out because of the discovery of a vast peripheral travel market.
Jumping out of the stock competition in front of you and looking at the homestay, where is the new continent?
The answer may be --- branding
In all industries, the secret to winning is no wonder that "deep cultivation" and "far-reaching".
Going back to the essence of the homestay industry, deep plowing—really seeking growth from the supply chain.
In recent years, this trend has become very obvious. Almost all homestays regard the number of listings on the platform as the basis of competition.
On June 3, Ctrip's online joining surfaced. Ctrip's "online joining" function currently has corresponding entrances on Ctrip's Ebooking official website and Ctrip APP. In addition, during the joining process, Ctrip's merchant service team will provide 24-hour answers to merchants' questions. After successfully joining, Ctrip will immediately assign a dedicated business manager to the merchant and provide comprehensive business guidance for the hotel. Many people don't understand how Ctrip is playing a game of chess, and simply understand it as a customer service.
In fact, its core is not the franchise itself, but the model innovation. The purpose of Ctrip is to open up the closed loop from content to transaction, covering links closely related to the supply side, such as products, publicity and marketing, etc., and to carry out closer cooperation with the supply chain to help them improve transformation, create value, and ensure high-quality services continuous output.
Of course, this model is still in its infancy at present, and Ctrip is only making a sample at most, and more players will join in the future. The advantages of new media channels of Wooden Bird B&B have actually gone a long way in helping landlords to market, but they have not yet formed their own system. There is still a long way to go to see if each platform can break away from the traditional platform model and replace it with integrated marketing services, so that more supply chains can achieve more growth and feed back the platform.
As for "Yuantuo", I think it is branding. To be precise, it is to cultivate a brand that can truly represent Chinese homestays and define the accommodation culture of young people in this era.
How to recreate a dominant brand on the world stage is a proposition for the next 10 years or even longer.
It should also be the next New World.