Pando

In SF, Airbnb puts foot in mouth, shoots it

With just over a week until the vote on Prop F, Airbnb does some gratuitous brand damage

By Dan Raile , written on October 23, 2015

From The Sharing Economy Desk

“It’s pretty hilarious. I made sure to show all those to my boss, and we got a laugh out of it,” said Amanda Kahn Fried.

Fried’s boss is the Tax Collector of San Francisco, and the cause of these water-cooler guffaws: the advertising campaign which Airbnb rolled out across town this week and then hurriedly apologized for and removed under a brow-beating viral wave of social and traditional media.

“It’s not every day our taxpayers rent billboards to brag about paying their taxes,” Fried said, smiling through the phone.

What was Airbnb thinking?

“The intent was to show the hotel tax contribution from our hosts and guests, which is roughly $1 million per month. It was the wrong tone and we apologize to anyone who was offended. These ads are being taken down immediately,” said Airbnb’s Chris Nulty told Pando in an official statement, apologizing, one assumes, to Airbnb's investors.

Oh – and one more question: Where does $1 million per month number come from?

“I don’t understand what you mean,” said McNulty. “We’ve been sharing that number for a while now.”

In the midst of the incredulityoutrage and soul-searching sparked and stoked across the internet in response to the ads, that $12 million a year claim has gone uncontested. It’s perhaps telling that given the opportunity to respond to the ads debacle, McNulty says Airbnb’s intent was to get that number out there, and repeats it. That number does not come from the Tax Collector’s office, which keeps such matters confidential by law.

“That number is from the taxpayer who is of course free to share their business with the world,” said Fried. She concedes that the taxpayer is equally free to share inaccurate information.

At this point I’d like to say, on behalf of PandoDaily, that the city of San Francisco is more than welcome for the $8 billion dollars we paid it in taxes in the last year, coincidentally the size of the entire City budget. Now let’s talk about those cycle lanes!

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Of course, Airbnb didn’t just plaster billboards and bus-stop shelters with this nice, round boast, as it did earlier this year in another ad campaign, one that didn’t generate nearly so much engagement. This most recent round of marketing proceded to tell various City departments what to do with that $12 million.

Some of these suggestions featured classic Airbnb-brand whimsy – “Dear Public Works, We hope you use some of the $12 million in hotel taxes to put escalators on all the hills.”  Others were quite specific – “Dear Public Works, we hope you use some of the $12 million in hotel taxes to build a bike lane here.”

Of course, in a democracy, tax revenues aren’t directly allocated based on the wishes of the highest payers – these things, when done, are done with some discretion. But even things did work that way, Airbnb is vastly overshooting the mark with what its $12 million could accomplish. This is only worth noting because Airbnb has plenty of people on staff who understand exactly how government works, how to grease its wheels, and press upon its levers of power. I’ve been documenting this aptitude here on Pando for quite some time. Did this campaign escape the marketing work caves without passing before the eyes of the disaster masters? Did the chain of command agree it was just the thing? Did it all go to plan?

Let’s take a moment to discuss how out of touch with civic reality it is.

Hotel tax revenues – projected at $384 million for 2015-16 – enter the City’s General Fund, forming a modest fraction of the General Fund’s $4.2 billion total revenues, far behind other sources such as property and sales taxes. Some $2.9 billion of the General Fund is unflexibly, permanently allocated by voter initiative (more on those in a moment). The remaining $1.3 billion is dispersed to top up departments as needed.

“Dear Board of Education, Please use some of the $12 million in hotel taxes to keep art in schools,” said one billboard. The San Francisco school district gets 0% of its funding from the General Fund.  

“Dear Public Library System, We hope you use some of the $12 Million in hotel taxes to keep the library open later.” The Public Library system has a projected 2015-16 budget of $117 million, roughly two-thirds of which is allocated for staffing. In the past ten years, library open hours have increased 17% – before Airbnb paid a dime in hotel tax.

Dear Airbnb, I hope you will use your need to control the damage from your ad campaign to produce a photo of Brian Chesky’s library card. (And, before you ask: Yes, you show me yours, I’ll show you mine.)

Airbnb could have taken a lesson from Google’s magnanimity last year, when the PR blight over the “Google buses” prompted the company to donate $6.8 million toward providing free public transport for minors in San Francisco. Whatever its motivations, Google did make a point of going above the call of duty to make right with city – it didn’t just brag about paying its bills.

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Of course, this advertising campaign “flop” (as declared by no less an authority than the New York Times) comes at a particularly tender moment for Airbnb. Having spent the better part of the year hammering its will into law at the Board of Supervisors, Airbnb recently has mobilized $8 million to beat a ballot initiative that would enact superseding regulations, only to see their manufactured support leaking from a self-inflicted puncture.

The suggestions for how the City should spend Airbnb’s legally required largesse – “Dear SF Tax Collector, You know that $12 million in hotel taxes? Don’t spend it all in one place” – come against the backdrop of a relentless ad campaign riddled with suggestions of 1984-styled government overreach (with creepy CSI Cyber-styled montages). Airbnb has been railing against the grasping of “bureaucrats” in various communications throughout the year.

It seems that some of that toxic resentment and unicorn bloat gas seeped into the vats of cotton candy and rainbows in the Airbnb marketing foundry, and was mistakenly shipped out. The campaign missed its intended target (Seussian irreverence? Oh the projects you'll fund...) and instead frequently came across as a giant tech corporation hectoring public servants. Voters may share the company’s dislike of taxes, but most voters love schools and libraries. With just over a week to go until the citizenry votes on Proposition F – which Airbnb has cast as a referendum on its local impact – this flub couldn’t have come at a worse time.

And yet, with the recent acquisition of top-dog political PR master Chris Lehane, could this really all be a case of tone-deaf, out-of-touch error? If there’s some secret master strategy, the hidden upside defies this humble blogger’s radar. 

It seems that after all Airbnb’s dogged finesse in getting just what it wanted from the city government, and maintaining its cuddly share-y image in the process, it appears to have grown dangerously unaware of its own public image, at exactly the wrong moment. Inadvertently, the company's adverts have brought its brand closer in line with civic reality.