The news: Airbnb and Instacart plan to launch a pilot program that would enable guests in select cities to order grocery delivery before and during their stays, per Bloomberg.
How it works: Starting January 5, guests at select Airbnbs in Phoenix, Orlando, and Los Angeles can use the “kitchen stocking” service.
- Guests can place their Instacart orders up to three weeks before their stay.
- Hosts will be paid $25 for each completed grocery order they receive and put away, plus a $100 bonus for their first order.
- The pilot program will run for three months.
A win-win situation: The partnership fits squarely within Airbnb’s and Instacart’s growth strategies.
- For Airbnb, the feature is a natural extension of its push into services, which CEO Brian Chesky expects to eventually garner at least $1 billion in annual revenues. It also reduces some of the friction in the guest experience, making Airbnb’s offerings more appealing to new and repeat customers.
- For Instacart, the deal is an opportunity to expand reach and gain customers—much like its recent partnership with Grubhub. Joining forces with Airbnb could also pay dividends for Instacart’s ad business by increasing inventory and reach, as well as make it more appealing to nonendemic advertisers looking to target travelers.
Our take: Partnerships like this one are poised to become more common as delivery platforms try to gain an edge over their rivals.
However, finding the right partner will be important. The Instacart-Airbnb collaboration works—at least on paper—because it offers both companies a way to make their services more valuable. Likewise, the tie-up between Instacart and Uber is effective because it allows Instacart to capitalize on restaurant delivery demand and Uber to broaden its audience.