In 2008, three men laid out air mattresses in a San Francisco apartment and called it “AirBed & Breakfast.” Seventeen years later, Airbnb is making another bet, this time it is on luxury. With the global travel market and consumer preferences changing, the company is attempting to reposition itself as a full-fledged lifestyle brand, integrating high-end services in a bid to capture more value from each booking.
However, this isn’t an expansion strategy, it seems to be a mere claw to get out of the hole they have found themselves in. In the first quarter of 2025, the company’s net income declined by 41.7% year-on-year to $154 million, with earnings per share falling to $0.25 from $0.41. Revenue rose 6.1% to $2.27 billion, a deceleration from the 12% growth recorded in 2024. Market Capitalisation as of May 21, 2025, stood at $83.89 billion, down 11.79% from a year earlier.
According to media reports, Airbnb underwent a large overhaul precisely 11 years ago in 2014 with a fresh logo, a redesigned platform and a greater shift towards storytelling and community. Essentially, they strived to create an image of having a home anywhere for the travellers. This worked for a short while, until it didn’t.
Now, the company is evolving again. In May 2025, Airbnb rolled out a slate of premium in-stay services—private chefs, spa treatments, curated tours, even craft workshops. The initiative, backed by a $200–250 million investment, is aimed at increasing average booking values and retaining affluent travellers, particularly in high-margin markets like coastal villas and urban penthouses.
The private chef service is currently the most requested add-on, followed by spa and wellness offerings. Airbnb’s Chief Marketing Officer described the move as an attempt to transform the platform from a place to book accommodation into a “complete travel experience provider.”
In the years since, the company has leaned heavily on marketing to build its brand, using customer stories, influencer tie-ups, referral programmes, and social media outreach. But in contrast to its earlier focus on organic and word-of-mouth growth, Airbnb now plans to increase marketing expenditure at a rate that outpaces revenue growth. The revamped marketing approach centres around four pillars: experiential storytelling, scaled personalisation, loyalty programme enhancements, and integrated marketing for new services. The brand is no longer merely advertising places to sleep, it’s selling the promise of unforgettable, curated experiences. Virtual reality previews are being used to entice travellers with glimpses of luxury offerings before they book.
Airbnb’s latest shift in execution shows great potential on paper. However, analysts have flagged execution risks. Coordinating a network of premium service providers at scale introduces operational complexity because these services need to be managed, vetted, and delivered consistently. However, the company anticipates Q2 2025 revenues of up to $3.05 billion, representing year-on-year growth of 9% to 11%. This isn’t just a model out of a playbook, it comes with a big, fat cost – higher spend, higher stakes and a shift away from the lean, viral growth model that once defined the company.
Can a resort-style reinvention lift this company, born out of airbeds, back to its peak? Only time, and perhaps a few well-planned chef dinners, will tell.