After transparency shift in Europe, Airbnb tests new display globally

In the coming weeks Airbnb will test different ways to display pricing for some properties in markets around the globe, showing a price that comprises nightly rate, service fee and cleaning fee in the initial listing search. 

This test comes little more than two years after Airbnb enacted similar changes to its pricing display in Europe following demands for more transparency from the European Commission and some national consumer protection authorities, led by the Norwegian Consumer Authority. 

In the European model, for searches with dates, Airbnb shows the total cost including property price, cleaning and service fees and applicable occupancy tax. 

In contrast, in the United States for example, searches for Airbnb listings in several cities currently show in the initial search listing a nightly rate that is just the property price with, in smaller font below, a total price for the stay that includes fees but not taxes.

In the new test, which Airbnb says “starts in certain locations later this month” and will run for a “few weeks,” Airbnb will show a total nightly price inclusive of fees but not taxes, which will continue to be broken out on the final payment page depending on location. 

The test is part of a review process Airbnb initiated in May, one day after an outcry on social media about its fees. 

“In recent days, we’ve heard from guests about fees on Airbnb reservations,” the company said in the May statement, which goes on to explain how fees are set and to announce the initiation of a review.

“We also understand that there is always room for improvement and to take the feedback we receive from our guests. Catherine Powell, Airbnb’s global head of hosting, today assigned a team under her purview to focus on conducting a comprehensive review of our fees and making recommendations where appropriate — with the objective of making pricing even more transparent and easy for Hosts and guests to navigate.”

Airbnb says after these tests over the next few weeks it will determine “whether or how” it changes the way prices are displayed. Airbnb says its service fee is under 15% of the booking subtotal for most stays and covers the cost of the “products and services” the platform provides. The cleaning fee is at the discretion of hosts – about 45% of hosts do not charge a cleaning fee and those that do, on average, charge less than 10% of the total reservation cost. 

In July, Expedia Group vice president for partner success in vacation rentals, Kevin Locraft, said Vrbo is also running tests on where and how it shows the breakdown of fees to improve transparency in its pricing.

“This is a place where you will see us lean in over the course of the next six to 12-plus months. We know travelers don’t like fees... so we are going to be leaning in to try to solve that issue, and ultimately as we do, when prices are therefore more transparent, we believe it will help conversion for everyone.”