Travel businesses have been taking a similar approach, opening up limited space in hotels or planes in the hopes that people would start taking trips again. Airlines in particular have rushed to return to business, which as we’ve seen everywhere else will likely end up hurting them — and the people who use their services — in the long run. The uncomfortable truth is that if you’re in the travel business in 2020, the pain isn’t going away anytime soon.
OYO
Just take a look at OYO, a “WeWork” for hotels that grew to be the largest hotel chain in the world in 2019 off the back of some rapid, no-profit expansion that now feels typical of a startup under SoftBank’s umbrella. But almost overnight from July 3 to July 4, OYO appears to have shut down 18,100 locations — a staggering 53% drop for what was seen as one of the few golden eggs in SoftBank’s pocket less than a year ago.
Airbnb
The grass isn’t any greener for Airbnb, which announced in May that it would lay off 1,900 employees, which the company said was around 25% of its workforce at the time. Airbnb’s job listings went from 500 last June, to 200 in January, to just 36 by recent counts after spending all of May and June dropping to as low as four openings.
Airbnb’s App Store data reflects the broader trend that people have simply stopped travelling. The second half of 2019 was a period of significant growth for Airbnb, with ratings climbing significantly month-over-month. But now they have utterly stagnated and held in a completely straight line since March 25. An increase in reviews is reflective of an increase in users, and three-and-a-half months is a long time to have few new adopters for an app.
So what will travel and hospitality look like on the other side of COVID-19? Whereas so many other industries like retail and healthcare will emerge completely changed with innovators on the rise and the old guard fading out, it’s hard to imagine that people will just stop travelling altogether. The more likely scenario is that hospitality apps will have a slow, painful, bloody crawl back up to regular business. Not only do they have to wait for medical developments that diminish the threat of COVID, they have to wait for them to get distributed and even longer for people to feel comfortable travelling again.
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