Airbnb is an online company that enables people to list, find, andrent properties (airbnb.com, 2016). The rental services are inclusiveof apartments, villas, hostels, and homes. Some people may also optto share their homes with guests for consideration. The company getsits revenue by charging a connection fee from the guest and host.Airbnb came into existence at a time when America was facing arecession and people had a difficult time paying their mortgages.Airbnb came to their rescue because it enabled them to sublet theirapartments to many people in order to raise the money required forthe monthly mortgage payments. Since its inception in 2008, thecompany has created offices in ten countries and is now worth $2.5billion despite not owning any properties for rental. This essayseeks to analyze the company’s strategy by looking at itscompetitive strategy, corporate strategy, and global strategy.
The company’s primary competitive strategy is to increase thenumber of listings in order to beat competitors. Currently, thecompany has over 1.5 million listings in over 191 countries. Thecompany seeks to increase its listings to 5 million by the year 2020.The other strategy is to keep diversifying. Whilst companies try tofocus their market as they mature, Airbnb is doing the opposite.Competitors such as Couchsurf only offer options for hotel and hostelrenting. However, Airbnb has increased the varieties of propertiesand prices that are on offer for renting (Welch, 2015). In addition,the hosts offer additional services than the average hotel. Theseservices include tour guiding, English lessons, cooking lessons, andrunning small errands. The website made it easy for hosts to showcasetheir talents to potential guests.
Airbnb’s global strategy involves opening offices in several partsof the world. Currently, the private-owned company has offices inBelgium, England, China, and Japan. The company has also launched itsproduct in most countries with the most recent being in South Africa(Airbnb. Com, 2016). With every launch, the company gets theopportunity to bring more ‘hosts’ and ‘guests’ on board. Theglobal launching exercises are also a good platform for the companyto gain publicity. Most of the other websites that offer similarservices barely conduct such publicity exercises. However, withAirbnb, the launch makes people realize that they can indeed sharetheir property for some extra cash. The customer reviews from the 191countries that Airbnb features have been very instrumental inachieving the company’s global strategy. By 2020, maybe Airbnb willhave ventured in virtually every country in the world.
According to Dickey (2015), Airbnb does not wish to take the routefollowed by many overhyped startups. It has regulated its efforts ofexpanding internationally in order to focus on the already capturedmarket. One of the corporate strategies it has employed to maintainthe market is instead of hiring more people the company isreassigning current employees to its new offices. According to thefounders, they prefer to maintain the company’s organizationalculture rather than bring in more employees who will dilute theorganizational culture that has seen the company soar greaterheights. In 2010, Airbnb refused to buy off Wimdu, a competitor inEurope. Apparently, Airbnb’s management was not comfortable withWimdu’s culture and tactics. The strife to maintain a goodorganizational culture has held its integrity to the present.
Airbnb.com. 2016. Ch 8 Segmentation and Targeting Markets.Retrieved from <http://airbnb-marketing.blogspot.com/ accessedJune 20, 2016.
Airbnb.com. 2016. Airbnb Launches New Products to Inspire People to“Live There”. Retrieved from<https://www.airbnb.com/press/news/airbnb-launches-new-products-to-inspire-people-to-live-there>Accessed June 20, 2016
Dickey, M. R., 2015. Airbnb Is Shifting Its Strategy So It Doesn`tCrash And Burn. Business Insider. Retrieved from<http://www.businessinsider.com/airbnb-is-shifting-its-strategy-2013-7>accessed June 20, 2016
Welch, L., 2015. The Unexpected Inspiration Driving Airbnb`s Success.Inc.com. Retrieved from<http://www.inc.com/magazine/201507/liz-welch/how-we-made-design-a-competitive-advantage.html>accessed June 20, 2016.