Airbnb Stopped Spending on Performance Marketing. And Grew.

When COVID-19 forced a global travel shutdown in March 2020, Airbnb did what most companies do in a crisis: it slashed spending. Marketing budgets were cut by roughly 80% almost overnight, dropping from $1.13 billion in 2019 to approximately $340 million in the quarters that followed.

The performance marketing campaigns — the search ads, the retargeting, the programmatic display — were the first to go. Airbnb stopped bidding on branded keywords in Google. It pulled back from Facebook and Instagram acquisition campaigns. It reduced affiliate commissions.

And then something unexpected happened: the business recovered.

The Data That Changed Everything

By the second half of 2020, as travel cautiously resumed with a shift toward domestic and rural destinations, Airbnb noticed that its traffic hadn't collapsed the way its paid media spend had. The company was still receiving roughly 90% of its website traffic through direct and organic channels — visitors who typed "airbnb.com" into their browsers or searched for the brand by name.

Brian Chesky, Airbnb's CEO, said the quiet part out loud in a February 2021 earnings call: "We were spending a lot of money on performance marketing, and when we pulled it back, we found that much of our traffic came to us anyway."

This was not a minor insight. It was an admission that a significant portion of what Airbnb had been spending on performance marketing was subsidizing traffic the company would have received for free. The branded search ads were capturing existing demand, not creating new demand. The company was buying its own customers.

The Pivot to Brand

Airbnb's response was not to eliminate marketing but to fundamentally reallocate it. The company shifted its budget toward brand marketing — TV campaigns, product launches, public relations, and what it calls "earned media" strategies designed to generate press coverage and social sharing.

The most visible example was the 2021 "Made Possible by Hosts" campaign, which featured real guest photos from Airbnb stays projected onto buildings, displayed in airports, and run as full-page newspaper ads. The campaign didn't have a call to action, a promo code, or a conversion pixel. It was pure brand advertising designed to make people feel something about Airbnb.

Chesky described the shift as a move from "buying customers to earning them." The company began treating product launches as marketing events, generating press coverage for features like Airbnb Categories, Icons, and flexible search that would traditionally have been announced in a blog post.

The results were difficult for performance marketers to ignore. Airbnb's marketing spending as a percentage of revenue dropped from 23.7% in 2019 to approximately 17% by 2023. Revenue grew from $3.38 billion in 2019 to $9.92 billion in 2023. Brand awareness, as measured by unaided recall surveys, increased in every major market.

Why Most Companies Cannot Do This

The Airbnb case is frequently cited by CMOs arguing for larger brand budgets. But it's important to understand why Airbnb's experiment worked — and why most companies can't replicate it.

Airbnb had three advantages that most brands do not. First, extraordinary existing brand awareness. By 2019, "Airbnb" had become a genericized verb in multiple languages. People didn't need Google Ads to remember the company existed.

Second, a CEO who functioned as the marketing department. Chesky is an unusually public executive who gives frequent interviews, posts regularly on social media, and treats product design as a form of communication. When Airbnb launches a feature, it's a media event because Chesky personally presents it to journalists and influencers.

Third, a product that generates organic word-of-mouth. People talk about their Airbnb stays. They share photos. They recommend specific listings to friends. The product is inherently social in a way that, say, insurance or enterprise software is not.

The Performance Marketing Industry's Response

The performance marketing industry had a predictable reaction to Airbnb's story: claim it was an outlier. And in some ways, they're right. Most startups don't have Airbnb's brand equity. Most products don't generate the same organic sharing behavior. Most CEOs can't generate earned media by tweeting about a feature update.

But the more nuanced lesson was harder to dismiss. Airbnb's experiment revealed a dirty secret of digital performance marketing: the attribution models that justify the spending are fundamentally broken. When a consumer sees a Facebook ad, then sees a Google ad, then types "airbnb.com" into their browser and books a stay, which channel gets credit?

In most attribution models, the last touch before conversion — often a branded search ad — gets the credit. This means companies spend billions bidding on their own brand names, paying Google for clicks from customers who were going to visit the site anyway.

Airbnb proved, by accidentally running the control experiment, that pulling branded search spend didn't reduce conversions by a meaningful amount. The customers came anyway.

What Changed After Airbnb

Several major consumer companies quietly followed Airbnb's lead. Booking.com reduced branded search spending in test markets and observed similar results. Meta's own research showed that a significant percentage of conversions attributed to Facebook Ads would have occurred without the ad exposure.

The broader shift has been philosophical rather than tactical. More CMOs now frame the question not as "brand versus performance" but as "demand creation versus demand capture." Performance marketing is increasingly understood as a tool for capturing demand that already exists. Brand marketing creates the demand in the first place.

The companies that are growing most efficiently in 2025 and 2026 tend to invest heavily in brand and product marketing to create demand, then use a modest performance marketing budget to capture the most cost-effective portion of that demand — rather than trying to buy every conversion at the bottom of the funnel.

The Uncomfortable Truth

Airbnb's story doesn't prove that performance marketing is useless. It proves something more uncomfortable: that many companies have been over-investing in the easiest-to-measure channels and under-investing in the hardest-to-measure ones.

The reason is incentive structure, not strategy. Performance marketing is easy to justify because it has clear attribution (even if that attribution is flawed). Brand marketing is hard to justify because its effects are diffuse, delayed, and difficult to connect to specific revenue.

Most marketing organizations optimize for what they can prove, not for what actually works. Airbnb showed what happens when a company accidentally stops doing one and discovers the other was doing most of the heavy lifting all along.