airbbQ's.docx - 1 How would you illustrate and compare the business models for Airbnb large hotel chains such as Marriott and Hilton and bed breakfast

airbbQ's.docx - 1 How would you illustrate and compare the...

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1. How would you illustrate and compare the business models for Airbnb, large hotel chains such as Marriott and Hilton, and bed & breakfast operators? Use the example chart in the textbook for business models as a guide (chapter 1, illustration capsule 1.2). Airbnb Large hotel chains Bed & breakfast Customer value propositio n Hosts can offer spare rooms or entire homes to guests Peer reviewed in a digital marketplace Hosts able to circumvent or avoid regulations and taxation of traditional lodging establishments Large facilities offering guests single or multiple rooms On-site amenities such as fine dining and spa facilities Established brand and reputation Small facilities offering a couple of rooms Cozy home-like ambience Usually owner-operators with more personalized and quieter atmosphere Locations in rural areas where guests can connect with surrounding community Profit Formula An estimated eleven percent is collected for each stay No operating costs associated with owning properties Attract new guests with low accommodation prices Attract large numbers of guests with several amenities Marketed as “vacation destinations” Charge a premium based on location and experience Small number of rooms can cause high demand and higher prices 2. What are the general strengths and weaknesses of a) large, hotel chains such as Marriott and Hilton, b) bed & breakfasts, and c) Airbnb? Explain how you would compare and contrast those businesses. Strengths Weaknesses Airbnb Functions in “sharing economy” no need for physical locations Low operating costs Peer-to-peer rating system Affordable prices Hosts do not have to follow safety regulations of traditional lodging facilities

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