Cassie Werber

Writer & journalist

Where have all the Olympic tourists gone? The answer might be, online

Published on The Wall Street Journal’s MarketWatch, July 28, 2012

One incentive to host the Olympics — and for Londoners to put up with the disruption it causes – was the tourist dollars it could pull in, especially to the hospitality industries. In terms of hotel bookings, this doesn’t seem to have been the case.

Financial News
reported that there are several reasons, ranging from people avoiding the city altogether, to bad press and bad weather.

Another reason could be an increasing range of options for travelers. London 2012 is one of the first Summer Games to take place since a boom in online accommodation services began to provide an alternative to hotels and estate agents.

Airbnb is an internet-based service that allows travelers to rent the rooms, flats or entire houses of people living in their destination city. The Californian company, founded in 2008, opened a London office last year and has 10,000 properties in the city. A spokesperson for the company said: “So far, over 400,000 guest nights have been booked in the U.K. and we’ve seen a 580% growth in U.K. guest nights booked in the past 12 months.”

Globally, it now operates 200,000 properties in 19,000 cities in 192 countries around the world. In June, it announced that it had reached 10 million bookings worldwide.

In March 2012 the company bought U.K. rival Crashpadder, which it described in an email as a “key announcement for Airbnb with the Olympics on the horizon.”

Prices on the site range from £7 ($11) a night for a room in Wapping, to £3758 a night for an “Immaculate flat for Olympic rent in Camden Park Road.” Airbnb described the £4000 price tag as “an outlier.”

The Airbnb business model works by adding a percentage on to the host’s charge and passing that on to renters. The service is free for hosts, who are also covered for £600,000 of loss or damage.

Patrick Welch, a freelance travel writer, says that the system works well for his east London apartment, which he rents out at £100 a night.

“I was hoping to rent it out for the Olympics,” Welch says, adding that he was first contacted a year ago by an agency suggesting he could charge a premium of up to four times during the Games. Despite repeated contact from possible renters over the last months, however, he has not been able to let it for the two weeks of events.

Welch says that he knows several people who had the same idea, and who also use other sites, such as HouseTrip, which launched in January 2010.

CouchSurfing
, meanwhile, is a movement that puts hosts who are willing to share their homes for free in touch with potential guests. The company confirmed that “no money is exchanged” and that its popularity has grown “entirely by word-of-mouth.”

Heather O’Brien, media projects manager for Couchsurfing, said: “We currently have 68,000 members in London and that number is up from 41,000 from last year at this time. England as a whole has 180,500 members and is up from 111,000 last summer. We can’t be sure whether this significant increase in membership is related to the Olympics, per se, but we have seen a lot of CouchSurfing activities created, and surfing and hosting requests centered around the Olympics.”

A recent infographic produced by the firm says that there are 4.5 million CouchSurfers in 90,000 cities, and that it has a presence in every country of the world.

In 2011, CouchSurfing raised $7.6 million in funding from philanthropic investment firm Omidyar Network and Benchmark Capital, a California-based venture capital firm. Airbnb has raised $119.8m of funding so far, from a range of investors including venture capital firms Sequoia Capital, Greylock Partners and Andreesen Horowitz.

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