If some of the biggest names of the sharing economy were born amidst the financial crisis of 2008, now is the economic turmoil caused by the pandemic that could be the one challenging these businesses. That’s the case of Uber, Airbnb, and other companies that rely on collaboration, and therefore, human interaction.
But whereas some firms were hit hard by social distancing measures adopted worldwide, especially at the beginning, a few of them are starting to see some good news as people adapt their lifestyle to new standards.
After laying off about 25% of its staff, the short-term rental company from San Francisco, which saw its revenue slashed in half due to the coronavirus pandemic, has recently announced that bookings have been showing a rebound sign. The recovery indicator occurred, in great part, since Europe started to ease lockdowns, and with its inhabitants starting to plan holidays.
According to NPR, Airbnb said that the number of future stays booked by North Americans dropped only 20% on May 19 on a year over year basis – something that could express that people are resuming on planning trips.
In Europe, the company previously announced that by the end of April the number of bookings by Danish users planning stays in their own country was at about 90% of April 2019 levels, while in the Netherlands domestic bookings were approaching 80% of last year levels.
In order to reassure customers of their safety measures, Airbnb has kicked off new cleaning protocols for hosts, including training on how to disinfect a home.
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Unlike Airbnb, which allows users to rent an entire space for themselves, Uber and other ride-hailing firms, on the other hand, still face more concerns, as the social contact between drivers and passengers is inevitable. To comply with safety measures, the global giant started to require the use of masks, as well as to provide cleaning supplies to drivers.
Ride-hailing trips, which generate the bulk of Uber’s revenue, dropped 80% globally in April, but the company earlier this month said demand was slowly recovering. Rides by the hour in a few markets Uber operates were also adopted as an effort to encourage trips to grocery stores, pharmacies, and doctors’ appointments.
But if asking for a ride on apps like Uber – when social distancing never been so on the rise – still leaves consumers cautious, car rental businesses might be gaining momentum. That’s the case of Turo, a platform for renting other people’s cars.
If public transportation doesn’t seem the safest choice for many, renting a car, instead, could be the solution, whether to commute to work or even to short trips.
While car rental giant Hertz has recently filed for bankruptcy in the US – a consequence of the sharp downturn in global travel – Turo reported a rebound in demand, with bookings over Memorial Day weekend (between May 23 to 25) down just 11% YoY. “In a recession, folks are going to be looking even harder to make ends meet,” CMO Andrew Mok told the media outlet. “If they can share their cars for a few days a week or a few days a month to offset all or most of their vehicle expenses, they’re going to really consider doing that. We think that’s going to be a huge tailwind for car sharing on Turo.”
“We are seeing a complete change in how we look to rent cars now,” Michael Lowe, CEO of Carpassionate.com told Forbes. “There’s an impact on the turnaround. People are very unlikely to accept a car that comes straight in from being rented. Consumers are looking to rental companies to really take ownership of thorough cleaning after each rental.”