Airbnb credits ‘optimised marketing and advertising strategy’ as it posts highest ever revenue

The travel giant praises its “high advertising efficiency” for offering its strongest ever quarter, after shifting priorities from functionality advertising to brand name building.

Shifting advertising devote from efficiency into model constructing, put together with the put up-pandemic vacation rebound, has assisted generate Airbnb to its strongest ever quarter this autumn.

The travel and hospitality small business posted a net cash flow of $834m (£618m) in its final results for the 3rd quarter of 2021, just about 4 situations greater (280%) than a 12 months in the past. With internet cash flow also 213% bigger than the pre-pandemic 3rd quarter of 2019, Airbnb says this quarter is the business’s most lucrative at any time.

Modified EBITDA exceeded $1bn (£741m) for the to start with time at a overall of $1.1bn (£815m), doubling the $501m (£371m) posted in the 3rd quarter of 2020 and additional than tripling the $314m (£233m) posted in 2019.

The business enterprise also attained its highest at any time earnings at $2.2bn (£1.6bn), 36% better than the exact time period in 2019, and approximately 70% up on 2020. Yr on two year revenue growth extra than tripled from 10% in the 2nd quarter of this 12 months.

The third quarter of the yr is generally Airbnb’s biggest because of to the summer journey peak and the rebound of vacation following the loosening of pandemic limitations has driven this progress more. In excess of the summer time the business enterprise arrived at a “major milestone” of one billion cumulative guest arrivals.

Amid the results, the enterprise highlighted the launch of its initially huge-scale advertising and marketing marketing campaign in five years at the beginning of this 12 months, ‘Made by Hosts’.

Airbnb hails early results from change to brand name creating in excess of overall performance marketing and advertising

The model campaign runs in nations which include the United kingdom, US, France and Canada throughout Television set and digital, and arrived as the organization declared it would be earning a long term reduce to its general internet marketing investment, having observed that slashing devote in the course of Covid had minor influence on site visitors. These cuts have principally been designed in effectiveness marketing commit.

The 3rd quarter of 2021 is continuing to see website traffic increase as a result of the campaign, Airbnb suggests, with all round traffic up by additional than 15% in comparison to 2019 in the 7 nations around the world where the campaign ran – “significantly in advance of non-marketing campaign countries”. To continue on the momentum, Airbnb introduced new advertisements for the autumn season.

Profits and internet marketing expenditure for the quarter rose by 136% yr-on-calendar year to $264m (£196m), excluding the effects of stock-dependent payment and acquisition-similar impacts.

This was “primarily” a reflection of the boost in manufacturer marketing financial commitment, the company claims, which also contains the ‘Olypara’ marketing campaign Airbnb ran for the duration of the Olympic and Paralympic video games.

The manufacturer signed the 9-calendar year settlement with the Global Olympic Committee (ICO) in 2019, Airbnb’s to start with key international sponsorship offer, which regardless of currently being postponed in 2020 will see the firm sponsor a overall of 5 Video games. 

For the 9 months ending 30 September, Airbnb sent 28% altered EBITDA margin progress as opposed to 2019. The business enterprise estimates that about two-thirds of that margin growth has been pushed by its monetary self-control and “optimised internet marketing strategy”.

The brand name remains concentrated on “making progress” toward attaining its long-phrase profitability objectives through “high promoting efficiency”, lowered variable costs and tightly managed preset charges. As this sort of, it expects to produce bigger margin expansion in the fourth quarter.

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