Airbnb Gets Cozier With Google, Ups Its Marketing Spend
31.05.2024 - 07:01
/ skift.com
/ Dennis Schaal
/ Ellie Mertz
Early in 2020, Airbnb diverted about $800 million in spend on performance marketing — mostly Google keyword advertising — and tilted more toward marketing its brand in avenues like video, social media and public relations.
Airbnb had been criticized pre-pandemic for spending too much of its marketing on Google. In addition to leaning away from Google starting in 2019 and 2020, Airbnb tested participating in Google Vacation Rentals, the price comparison service, but ultimately decided not to get involved.
But at the Bernstein conference Thursday, Airbnb Chief Financial Officer Ellie Mertz said during an interview on stage that the company over the last year has spent “modestly more” on marketing through Google. Airbnb has used Google advertising products including “keywords” and Audiences, she added.
Mertz said Airbnb “dials up and down” marketing on Google where Airbnb sees the opportunity for efficient marketing spend.
Based on several Airbnb initiatives over the last year, the company has been able to spend “modestly more” on Google “and maintain greater efficiencies,” she said.
Mertz emphasized that “performance marketing continues to be a minority of our overall marketing spend… This is not a big portion of our marketing budget or a percent of revenue,” she added.
Asked why Airbnb wouldn’t spend 10 times more on performance marketing to drive 5% of incremental revenue growth, Mertz said: “First and foremost, we don’t depend on them very substantially. So as I said earlier, 90% of our traffic is coming from direct sources, which is a great thing in the overall context of the P&L.”
Airbnb is an outlier among online travel companies. Booking Holdings and Expedia Group spend billions of dollars on Google performance marketing, and that is a much higher percentage of their revenue annually than Airbnb’s spend on the search engine.