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MKTG3117 ReportAirbnb ServicesMarketing StrategyXiaobing He (450000687)JINGJING LU (440076250)Michaela Rock (440383088)Kevin Wang (430328288)Tutorial Time: Tuesday 1-2p.m. Presentation week: Week 10
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MKTG3117 ReportTable of contentsIntroduction……….................................................................................................Part1 Background……………………………………….................................……. The external environment……………………………………………….. Part2 Analysis………………………………………...................................……. Key marketing issues……….............................................................Key customer segment……………...................................…………….. Current service marketing strategy…………………………………. Part3 Recommendations……………………………….............................……. Conclusion ………………………………………………..........................Appendix ………………………………………………........................…………References ………………………………………......................…………………
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MKTG3117 ReportIntroductionAirbnb.com or ‘AirBed & Breakfast’, was founded in 2009 and expanded service to full residence rentals (Christensen & Raynor, 2003). Due to the company’s innovative internet-based business model and its unique appeal to tourists (Guttentag, 2015), Airbnb growth has been extraordinarily rapid and is now responsible for millions of global bookings for tourists (Salter, 2012). In this report, the market environment and current strategy of Airbnb will be analysed, current market issues identified and possiblesolutions recommended to support Airbnb in further growth. Part 1 BackgroundMacroenvironmentDemographic & EconomicA large proportion of Airbnb’s growth is attributable to Millennials who are an extremely important market segment and account for approximately 60% of the platform’s total bookings, increasing by more than 120% in the last year alone (Airbnb Citizen, 2016). Millennials aged 18-35 along with younger generations are expected to comprise 75% of all consumers and travellers by 2025 (Airbnb Citizen, 2016). Australia’s population growth which increased by 1.6% in 2016 (ABS, 2017), accompanied with higher levels of disposable personal income has a direct link to higher levels of tourism (Smith, 2003) and increases consumption power which translates into more available funds for travel (Trading Economics, 2017).Social
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MKTG3117 ReportWith economic growth in Australia expected to remain below average, only a moderate increase of 1.5% is expected for domestic visitor nights (up to 343 million nights) in 2017-18 (Tourism Research Australia, 2017). Economic growth is expected to pick up the following year however, with accommodation demand expected to increase by 3.7%(Tourism Research Australia, 2017). The travel attitudes of Millennials contribute greatly to the expanding travel and hospitality market as travel is considered a priority for Millennials, and over 80% of Millennials look for travel experiences that are “more adventurous, local and personal” which drives them to stay in local neighbourhoods rather than near to top tourist sites (Airbnb Citizen, 2016). Seniors conversely, are the most rapidly growing host demographic with home sharing providing the extra income that allows them to remain in their homes longer (Airbnb Citizen, 2017).
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