A new TV ad campaign threatens to open a troubling new chapter in the war between the hotel industry and sharing sites — one that tries to paint Airbnb (AIRBNB) as unfair and discriminatory to guests but could ultimately cast a long shadow across the entire lodging industry.
The ad, launched yesterday by ShareBetter, a nationwide organization reportedly funded by the New York Hotel Trades Council, tells the story of a guest who claims the sharing site routinely discriminates against her because of her skin color.
“I am a black woman,” she says in the 30-second spot. “I get declined all the time on Airbnb.”
“Airbnb should be doing more to stop racial discrimination,” she says, “because we deserve better.”
Then, as if on cue, an Airbnb host in North Carolina reportedly canceled on a black investment banker and sent her a slew of racist insults. And on Tuesday, Brian Chesky, Airbnb’s CEO, said Airbnb has permanently banned the host.
The incident in NC was disturbing and unacceptable. Racism and discrimination have no place on Airbnb. We have permanently banned this host.
— Brian Chesky (@bchesky) June 1, 2016
A Harvard Business School study published earlier this year found that having a “distinctively African American name” led to being 16 percent less likely to be accepted at Airbnb, The Guardian reported. “We strongly believe that racial discrimination is unacceptable and it flies in the face of our mission to bring people together,” s Airbnb spokesman Nick Papas told Fortune. “We prohibit content that promotes discrimination, bigotry, racism, hatred, harassment or harm against any individual or group and we are taking aggressive action to fight discrimination and eliminate unconscious bias in our community.”
Behind the scenes
The ad campaign is just the latest in a string of attacks, funded in part by the hotel industry, as Airbnb has grown into a giant, valued at $24 billion. One of the most overt is the American Hotel & Lodging Association (AH&LA) study released last year that concluded some short-term rental companies are enabling the proliferation of illegal hotels.
AH&LA says it did not fund the current TV campaign, but through a spokesman, praised ShareBetter as “an important voice in the short-term rental debate.”
The trade group said it also welcomed a discussion of race and discrimination in the lodging industry.
“We understand that elected officials, regulators and the courts are examining the issue of race among many other concerns brought about by short-term rentals which are impacting cities and states around the country,” says Rosanna Maietta, a senior vice president for AH&LA. “Hotels welcome and serve everyone regardless of race, color or creed. We don’t turn anyone away.”
Is Airbnb discriminatory?
This isn’t the first time the question of Airbnb’s practices has been raised, nor is it likely to be the last.
Last month, Greg Selden, a Richmond-based talent agent, filed a proposed class action lawsuit a in a Washington D.C. federal court, alleging Airbnb routinely violated the Fair Housing Act and the civil rights of people of color. Selden, a black man, says he inquired about the availability of accommodations in Philadelphia, but was told by a host that the rental was unavailable. He then created two fake accounts that featured photos of white people and was told the unit was available.
Selden would not comment on the litigation, but said he supports the ShareBetter campaign.
“I think it is appropriate to raise awareness about a widespread issue,” he says. “I think it’s something that is very necessary and I commend ShareBetter for taking the initiative to tackle discrimination in the sharing economy.”
Efforts to reach the woman featured in the ShareBetter campaign were unsuccessful. A ShareBetter representative, reached yesterday afternoon by email, refused to answer questions about the funding of the TV ad campaign, the identity of the woman featured in the ad, or the identity of those funding the campaign.
Part of ShareBetter’s mission, though, is to keep sites like Airbnb in check. “Far from being a harmless service where residents can share their homes with tourists, Airbnb enables tenants to break the law and potentially violate their leases,” it says. “It exacerbates the affordable housing crisis in our neighborhoods, and it poses serious public safety concerns for Airbnb guests, hosts and their neighbors.”
Messages like those are resonating in city councils across America. For example, Seattle is considering new regulations that would allow only property owners using their primary residence to operate short-term rentals year-round. Hosts not using their primary residence would be limited to 90 total nights over 12 months.
What’s the prize?
At stake is the future of the $155 billion lodging industry, which traditional hoteliers desperately do not want to concede to sharing sites like Airbnb. Non-traditional accommodations like apartment rentals and vacation homes offer many amenities that hotels can’t, and often offer them at a cheaper price. That’s stunted hotel revenue growth, a trend the lodging industry seems determined to reverse with a combination of regulation and bad publicity.
But the hotel industry is far from perfect when it comes to the question of racial discrimination. In 2014, for example, the U.S. Equal Employment Opportunity Commission sued four hotels doing business as “Whitten Inn” for violated federal law by discriminating against employees because of their race, national origin, and color. The case is still pending, according to the agency.
It’s unlikely the hotel industry wants a vigorous debate about race and views this as just another low-level PR campaign to erode Airbnb’s credibility. But the ShareBetter ad, combined with the proposed class action suit, has the potential to start a more serious discussion about race in the hotel industry — one in which neither side is likely to win.
