Consumer Reviews and Host Strategies: Managing Rating Deviations for Optimal Airbnb Performance

This research addresses the issue of inflated ratings in the Airbnb property space, which often generates misleading consumption and performance data. We analyse how positive and negative rating deviations influence Airbnb hosts’ performance metrics. Our study further investigates the moderating effects of the Superhost badge and the distinction between single- vs. multi-listing hosts. We model the London Airbnb industry between 2015 and 2021 using a two-level mixed-effect model to account for host characteristics and neighbourhood (borough-level) effects and predict the influence of online rating deviations on host performance. Empirical insights reveal that positive deviations significantly enhance host performance, particularly benefiting single listing hosts. In contrast, negative deviations detrimentally impact performance, with single listing hosts experiencing greater adverse effects. Notably, the Superhost badge amplifies the overall relationship between review deviations and host performance.