The Johnson Family as Airbnb Hosts

The Johnson family is part of the host network lodging industry as they are renting out one of their duplex units in the Airbnb platform. As part of this network, they are part of a growing movement of that shared economy idea that is part of our world.

Host networks

Host network participants reap benefits of this alternative lodging type but also must deal with unique burdens. Hosts get to cater to those that dislike traditional, cookie-cutter rooms in a big-box hotel or those that want to be super close to their destination. This market is growing like crazy as tourists consider their lodging as part of their experience. Traditional hotels get roughly the same kinds of guests; a host's home or room brings in a wider range of types of people. And hosts get to rely on the exploding technology in web-apps, mobile-apps, AI and other services to help manage all parts of their booking.

The Johnsons use the Airbnb platform to handle most of their needs. Airbnb lists the unit and handles taking reservations. In the reservation, the platform can use dynamic pricing, an add-on, to automatically set the Johnsons' rental to change the pricing based on demand. Airbnb takes the payment and distributes it to the Johnsons and provides a summary of revenue at the end of the year. Guests communicate with the Johnsons through the app in the reservation, and the app releases check-in details automatically at the correct time. Airbnb doesn't have a cleaning service the Johnsons can hire, but the platform does allow them to charge a cleaning fee and provide enough turn-around time between bookings. Airbnb also allows bookings on their site to be listed on 3rd party tools through Airbnb's API. This feature gives the Johnsons the possibility of getting their listing spread to more eyes.

Airbnb handles the money, but the host is not a W2 employee of the host network. Hosts must deal with their taxes as self-employed people or those that earn rental property income. Self-employed people should report and pay their taxes annually.

Challenges

However, the Johnsons, like other hosts, experience the burdens of alternative lodging. They must handle the housekeeping themselves in some manner: either clean the unit themselves or hire another company to do that. The case study identifies that they have had a cleaning service, and that choice brings more problems, namely relying on a 3rd party to do work in a reasonable time. Those services can be (and are for the Johnsons) unreliable and often have issues with quality. Likewise, maintenance is a challenge for hosts and for the Johnsons. A host really needs to know how to fix anything in the house or, like housekeeping, must hire someone to fix it in a reasonable time.

The Johnsons must keep their calendar constantly updated and are often bound by it. If a guest books a date in the future but suddenly the Johnsons can't be there to do what they do for the guest, the Johnsons are suddenly in a bind. It is nice to have reservations handled, but that can be quite the chain. Related to this is the idea of 'correct room'. If their unit suddenly is not 'show ready' in some way (if they care about that), they must cancel reservations.

Additionally host networks typically take a percentage of each listing. It seems to be around 15%. That certainly is a challenge for hosts: they do not get to keep all the money.

Finally, a host network must work with or learn how to do guest service. They need to learn what their guests expect, how to deliver that, and how to recover if expectations aren't met. While most of the communication happens via the host-network app, there the host has to know how to manage that, respond in a timely manner, and show guest service principles (or at least they should do so). The Johnsons do not have formal training, so this is quite a challenge to put into the mix.

Differences from traditional hotels

Host network hosts are pretty much an entire hotel service in one person. There are no departments in a host network or leaders in those departments to manage individual segments of the lodging experience. Hotels have trained staff and can handle reservations, can deal with Out of Inventory Rooms, can give all the information needed by the guest, and have a whole staff of house keepers. Hotels manage many more rooms, but each team member is good at what they do, and many are specifically trained for guest service. The challenges the Johnsons face are all their own to solve. And these challenges might come on because of the wider segment of people who prefer Airbnbs.

One huge challenge faced by hosts, different than traditional hotels, is dealing with their local community. Currently the Johnsons are dealing with neighbors complaining about the noise and all the strange people (and presumably their cars) and dealing with policy makers. Navigating this on their own, they must respond to what the government, their neighbors, and the guest wants. In recent times, the Johnsons heard their government wants to start registering these units, charge yearly fees, and force further restrictions. All of these are additional burdens that weigh down the Johnsons even more. I assume that this further dampens their entrepreneurial spirit.

Government restrictions

These additional restrictions, in my opinion, are needed. Government oversight and policies can limit the number of people who take up this host endeavor, and that might be a good thing. People who are serious about providing guest service in this alternative lodging will do all that's necessary; people who do this because they see only the money side of it might reconsider. And, while governments almost always mess it up, they do have the goal of serving the entire community. Restrictions and policies can ensure these host network buildings are contributing to the growth and happiness of the community.

Impact on the community

The Johnsons are dealing with their neighbors' complaints of noise and the transient guests. Short-term rentals cater to transient guests. A quaint community with tourist experiences nearby will draw in guests, and those guests, not part of the community, will disrupt the neighborhood. I can see neighbors exasperated by the traffic to and from the host accommodation. Neighborhood watches would have a terrible time monitoring their area. The entire community itself would benefit from the extra spending that comes in from these guests. So there is quite a lot of impact. Short-term guests mean a constant turnover, and those always-new folks coming into the community would never stop.

Host support programs

The Johnsons can take advantage of Airbnb's support programs. The platform's community center site has quite a few resources that preps them for hosting and provides continuous education. Many current hosts post their experience, newer hosts ask questions, and the various pages written by Airbnb staff provide meaningful insight into how to run a listing. Other platforms provide this as well. As a former teacher, I think Airbnb's is the best. They have a clear and inviting website, their posts are categorized by topic, and each post is readable and one can learn something from it.

If I were designing a support program for new Airbnb folks, in addition to the plethora of articles, I'd add the following:

1. A learning plan that new hosts can go through on their own. Maybe completing each milestone in the course could unlock benefits, rewards, features, etc.
2. Non-competitive mentors. Volunteers from around the world that can be a shoulder to lean on, to get direct communication with, and regular check ins. This would require experienced hosts be available, and for that, maybe unlocking some rewards. For example, veteran hosts that participate could have their fees cut in half. Instead of 15% take by Airbnb, maybe 7%-10% only.
3. Continual refresh of articles. There's nothing so awful when learning as finding outdated material out there. I'd keep the blogs fresh by inviting hosts to contribute, beefing up my education staff, and reviewing the content at least quarterly.
4. Community-based compliance training. In bigger host markets, I'd add sections to my training program that spell out current local laws. This gives every host one resource to visit to see updated information.
5. Finally, as the company, I'd check in on hosts starting out that they are feeling confident in what they do. After all they are the face of Airbnb; their reputation affects the company as a whole.

A balanced policy framework

Hosts need communities to provide attractive amenities for guests to visit, and communities need hosts to bring in guests, so revenue is plenty. So, a balanced policy is necessary. Here are my thoughts:

1. There's nothing wrong with taxing these hosts as businesses as the guests use the town's facilities and services.
2. Businesses like these do need to be registered and recognized by the local government. This should be easy to obtain, cheap, and not overly cumbersome to keep up. Municipalities are responsible for their citizens' basic needs, and by knowing what businesses are running in the boundary lines, a government can adequately plan for and provide.
3. Hosts should be given some kind of freedom from some regulations that pertain to full businesses; most hosts are part time and are very unofficial as a host. So, they need to be exempt from those policies that reign a full business in. The Johnsons are the owner of this duplex and live in the other one. They are not an investment firm that is hands-off; rather they are there to see to the needs of their guests. So these kinds should be given some relaxed rules.
4. Governments should insist upon and provide some host-network education. The curriculum could reinforce how the host and the government are in this together and that working together is vital to the community and to the host themselves.

The Johnsons' experience with hosting is coming to a turning point. They need to decide how to get what they need to continue doing this work. If it is their calling, they can educate themselves further in this industry so they may continue to thrive.

A personal thought

I currently work on my own. I have a business and pay myself a salary. I enjoy working alone, and I enjoy serving guests. As someone who is training in hospitality and who has experience as a teacher and at Disney, I am starting to find this industry appealing. Though I see myself more as a B&B owner, this really isn't too far off that path. It might be interesting to manage the challenges of being a host while providing exceptional guest service. Working for myself and providing great guest service is kind of what I want to do.