Airbnb says ‘full funnel approach’ to marketing is driving ‘strong’ ROI

After posting its first ever quarterly profit, Airbnb says it’s pleased with the payoff from its marketing spend in the last year with an improved ROI.

AirBnBAirbnb says its “full funnel” approach to marcomms is delivering “strong” return on investment, a claim that comes as the company reports its first ever profitable quarter.

It says adjusted EBITDA reached $262m (£208m) in the three months to 31 March, a 14% increase from the same period last year.

The increase was driven by a spike in revenue, which grew 20% year on year to $1.82bn (£1.4bn), and an increase in the volume of nights and experiences booked via the site, up 19% year on year to 120 million.

Airbnb made the decision to vary its marcomms activity in 2021 after admitting that it had previously favoured performance channels at the expense of brand building.

The business’s “full funnel approach” approach to marketing is paying off by driving improved ROI, Brian Chesky, cofounder and CEO said in a call with analysts yesterday (9 May).

Airbnb’s earnings surge following ‘incredibly effective’ shift in marketing spend Dave Stephenson, Airbnb’s chief financial officer, added that its decision to bring forward investment to the first half has helped lift revenue.

He said: “I’m very pleased with our overall marketing strategy, and I’m happy that 90% of our traffic remains direct unpaid, and that does great returns,” he added. Brand marketing returns have been “quite strong” he said, as the business now looks to expand this activity into other markets.

Airbnb CFO: We were right to shift spend from performance to brand-building“When we amplify our brand in search engine marketing with things like social and PR we have that full-funnel approach, it works really well,” he claimed.

Off the back of these results, the business is anticipating a “strong” summer travel season, and expects to deliver revenue of between $2.35bn (£1.86bn) and $2.45bn (£1.94bn) in 2023’s second quarter.

Chesky also teased an upcoming major brand campaign to promote Airbnb rooms, where customers rent single rooms rather than whole units, for summer.