- Marriott, the world's largest hotel chain, plans to launch a US home-rental website that would compete with Airbnb, according to The Wall Street Journal.
- Marriott reportedly may reveal details about the platform as early as next month.
- The company trialed the idea with a six-month pilot program in London that was extended to Paris, Rome, and Lisbon, Portugal, in October.
- "One of the reasons we didn't jump into this quickly is we thought this is a business that is not made for us," CEO Arne Sorenson said on Marriott's fourth-quarter earnings call last year.
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Tired of staving off Airbnb's efforts to poach its hotel guests, Marriott has been preparing to throw down the gauntlet. The world's largest hotel chain now plans to launch a US home-rental website, according to The Wall Street Journal, positioning itself as a direct rival to the $35 billion lodging startup.
Marriott could reveal details of the platform as early as next month, according to The Journal, which cited people familiar with the matter. The initiative follows a six-month pilot program conducted in London with Hostmaker, a home-rental management company, that was extended to Paris, Rome, and Lisbon, Portugal, in October.
The company last month mentioned it was starting a trial of the product.
"Our home‐sharing pilot in Europe attracted great interest from our loyalty-program members and yielded significant learnings," CEO Arne Sorenson said on the company's fourth-quarter earnings call.
The hotel giant's 30 brands include St. Regis, Westin, and Le Méridien. It boasts more than 1.3 million guest rooms around the world, according to its latest earnings report.
Airbnb has taken steps into the hotel space. It announced it would acquire Hotel Tonight, a hotel-booking service that analyzes hotel inventory and offers discount rooms, in early March.
Marriott has been cautious about entering the home-rental business over concerns about its legality. It hasn't shied away from criticizing Airbnb for flouting regulations.
"It's one thing for a startup to engage in a business that really does not comply with law — it'd be another thing altogether for a 90‐year‐old company like Marriott to step into a business, which is fundamentally illegal," Sorenson said on Marriott's first-quarter earnings call last year.
"One of the reasons we didn't jump into this quickly is we thought this is a business that is not made for us," he added. "We have now figured out that we can run this business in a way that does fully comply with law."
Marriott would pay lodging taxes and obey local restrictions on the number of nights that homes can be rented out, Sorenson said on the call. He added that the company's well-known brands could help address what he called the "paralyzing array of choices and the lack of branding and the lack of real attributes of quality around service and product" on existing home-rental platforms.
The company grew its number of rooms by nearly 5% in 2018, and worldwide revenue per available room rose 3%. Adjusted for reimbursements, Marriott's revenue rose about 4% to $5.2 billion in 2018, driving operating profit up 13% to about $2.8 billion.