In less than two years, Hazelnut B&B, the Airbnb-like platform rolled out in April 2017 by Meituan Dianping, has aggregated 350,000 listings and more than 80,000 property owners online across 300 cities in China. For the second half of 2018, the number of room nights transacted through the platform increased 25 times compared with the same period of 2017.
Mr. Weihe Feng, CEO of Hazelnut, said the platform was seeing extraordinary growth and racing ahead of competitors due to a more favorable macro environment, demand for better experiences, and supportive policies.
Meituan’s data shows that the annual average room nights for China's homestay industry had been doubling in 2016-2018, and the rate of increase is expected to be over 100% from 2019 to 2021.
"In the next five years, alternative accommodation is likely to claim 15%-20% market share of the accommodation sector. This points to the potential for the segment to expand by 6-8 times," said Mr. Feng.
The younger generation is becoming more discerning with spending and the choice of “accommodation”. This will help drive Hazelnut’s business development. As the number of younger customers in the space continues to increase, the demand for diverse experiences for travel, gatherings and business travel will continue to grow. Accommodation needs will become keener, while they will be less insistent about staying at hotels during their travel.
Hazelnut’s users are 27 years old on average. The bulk of them are 21-year-old college students. Also, the user satisfaction rate of homestays is higher than that of hotels.
The home-sharing business is taking off in lower-tier cities. Data monitoring platform Trustdata reported that, in November 2018, the proportion of B&B users in second-tier cities increased rapidly to comprise 55% of the total, far exceeding the 19% for first-tier cities.
Hazelnut data shows that the second- and third-tier cities have been racing ahead in B&B supply. Chengdu has usurped Beijing and Shanghai to become the city with the highest number of B&B listings. Chongqing, Xi'an, Qingdao, Xiamen and other second-tier cities are also among the top ten cities with the highest number of listings.