The sluggish presence of Airbnb in India

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Multinational technology companies in India aren’t fence-sitters. Amazon’s got a good hold on e-commerce and web services. WhatsApp on chat and now, financial technology. Tinder on dating. Google on local search, payments and a bundle of other services. Facebook on digital advertising and on fake news.

There’s one category, however, where outsiders have had little success in displacing indigenous incumbents. Travel.

Is anything stopping OYO?

From the looks of it, there’s nothing stopping Oyo. Not money. Not ambition. The homegrown company, MakeMyTrip isn’t a pushover either. After acquiring Ibibo in 2016, it is India’s largest online travel agency (OTA); and hotels & accommodation are increasingly becoming a significant part of its business.

Compared to them, international companies have had little success. Booking.com hasn’t really set the market on fire. Neither has Airbnb, the global homestays company with a $31 billion valuation, which has been in India for six years now.

Much of Airbnb’s existence in the country can be summed up in one word—promise.

Promise that, by now, Airbnb would have revolutionized the homestays business in the country, but hasn’t.

Being a part of the launch

Take its global product Experiences, for example. In 2017, Airbnb’s CEO and founder Brian Chesky flew to India to be part of the launch of Experiences in the country. He even participated in the company’s first curated experience—a fashion show titled “Journey of Couture” in association with Delhi-based designer duo Shantanu-Nikhil—where he walked the ramp.

The idea of Experiences is not just to help people with the stay but to make travel a transformative experience by allowing them to discover communities and their passions. As part of Journey of Couture, participants were given a peek into the designers’ studio, met artisans, and learned what goes on behind the scenes at a fashion show.

It was meant to be the start of something big in the country. After all, in an interview with Fortune magazine late last year, Chesky said that the Experiences business was growing 13 times faster than Airbnb’s homes business.

However, while the number of Experiences globally has swelled to around 20,000 in the last few years, it stands at just 100 in India. Sources in the travel industry say the initiative hasn’t really been able to build momentum in the country, pointing to glaring shortcomings like how Kolkata, for example, doesn’t have any listed experiences despite being famous for its rich history and culture.

While pricing is said to have played a part in Experiences’ slow growth in India, its limited success is emblematic of Airbnb’s journey in the country.

A company that has shaken up the hospitality sector globally, has only had middling success in India. For perspective on Airbnb’s fortunes in India as opposed to outside, the combined revenue of both of Airbnb’s India entities—Airbnb Payments India and Airbnb India—is under $8 million. Meanwhile, in China, the company expected its revenue for FY18 to touch $130 million.

For a company set for a multi-billion dollar initial public offering (IPO) in June or later this year, Airbnb’s Indian blindspot is puzzling. In fact, success in India could play a major role in the success of its public issue, as India’s online travel market is expected to be worth $48 billion by 2020. So what’s holding Airbnb back in the world’s second-most populous country?

Incredible India

Amanpreet Bajaj, the country head of Airbnb, seems far from disheartened by Airbnb’s inability to truly take off. In an emailed response to The Ken, Bajaj says that listings in India have grown by 115 % over the past year and the platform currently has 40,000 listings across the country.

While his positive take on growth in listings is fair, the fact remains that India still only accounts for just 1% of Airbnb’s 4 million overall listings across 191 countries.