AIRBNB-GROUP-7.final.docx - Hanoi Fall Semester 2019 EXECUTIVE SUMMARY Founded in August of 2008 and based in San Francisco California Airbnb is a

AIRBNB-GROUP-7.final.docx - Hanoi Fall Semester 2019...

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Hanoi, Fall Semester, 2019
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EXECUTIVE SUMMARYFounded in August of 2008 and based in San Francisco, California,Airbnb is a trusted community marketplace for people to list, discover, andbook unique accommodations around the world. The business has become theworld’s fastest-growing holiday website and was estimated $31 billion worthby Forbes in 2018.As for business model, compared to traditional competitors, Airbnb hasdifferent customer value proposition, which offers a platform directlyconnecting house owners and guests, cheap and unique accommodations, areview system and a simple app. While large hotels and Bed & Breakfast earnrevenue from renting rooms and pay cost for physical assets and services,Airbnb’s revenue is mainly service fee on guests and guests and cost involvesupdating software and marketing. Therefore, profit margin depends on thenumber of participants in the platform.The business has strengths at a clear business model, a low operatingexpense, tax advantages, and an efficient dual rating system, whereas exposedto the risk of ideas easily duplicated, legal issues and the dependence on hosts’serving. Currently, with the development of sharing economy, customers havechanged their preference from ownership to experience, demand to review theirstaying and get familiar with using smartphone. Catching up with the trends,Airbnb offers guests unique local stay experience, rating system to choose thedesired experience and friendly-user application. The key factors determiningthe success or failure of the company lie in the use of technology to remaincompetitive advantage, legal barrier, authentic experience and rating system.To enhance the competitive advantage and eliminate current or futurerisks, Airbnb is recommended to take five measures: (1) solving the issue of
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race discrimination by conducting automatic rejects for claimed-unavailablerooms, providing objective profile and reporting tools for discriminated guests;(2) collaborating with traditional brick-and-mortar establishments andextending partners for other rental services to reduce competition risk; (3)continuing to lobby and advocate for friendly legislation; (4) researching andworking with local authority to come up with suitable business plan for eacharea (5) investing in technology for better experience of app-users as thedifferentiated advantage.2
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ANALYSISI. COMPANY BACKGROUND:Airbnb is an online marketplace for arranging or offering lodging, mainlyhomestays or tourism experiences, which was founded in August 2008 by BrianChesky, Joe Gebbia, Nathan Blecharczyk and based in San Francisco,California and United States. This company does not own any of real estatelistings which acts as a intermediary, receiving commissions from guests andhosts from each booking. Airbnb is considered as one of the world’s largestmarketplaces for its uniqueness, authenticity, providing over 7 millionaccommodations and 40,000 handcrafted activities which are all empowered by
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