12 Jan 2023


How Airbnb Achieved Success

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Hospitality industry includes firms that provide lodging and dining services for customers. Many of the businesses in the travel and hospitality industry offer customers with prepared meals, accommodation, snacks, and beverages among other crucial services. Globally, the leading in the geographic market consumption in the hospitality industry is Asia and America. The 2016 global reports on the hospitality industry show that Asia accounts for 38% of the market while the Americas is second with 37% of the market share ( Law et al., 2015 ). Due to the technological advancement, the major hotel brands globally are employing digital hotel room keys to enhance the convenience. Customers can use their smartphones to unlock and access the rooms thus eliminating the problems of key loss. The global hospitality industry is rapidly expanding as many firms are going global. The industry generated $550 billion in revenue in the year 2016. As competition within the industry increases, more firms make strategies to increase their competitive advantage by expanding into global markets and using advanced technology to make it convenient for the customers to access the services. 

Many hotelier firms use the online travel industries to market themselves to the customers. As competition grows and every firm in the travel and hospitality industry struggles to remain competitive, online travel agencies provide the best site for these firms to market themselves to the customers ( Guo et al., 2014 ). It provides the most lucrative marketing channel for the firms in the hospitality industry to take advantage and grow into the global market. According to PhoCusWright’s paper, the online travel agencies were responsible for $19 billion revenue generation in the hotel bookings in the United States alone. Guests who want to travel use the online travel agencies to compare the price, time and location of the hotels before making a decision. Before using the online travel agencies to market themselves, hotels usually consider a variety of elements that help inform their decision. Expedia, Priceline, Orbitz Worldwide and Travelocity control are the leading operators in the industry in the United States. 

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Airbnb is a privately owned global company that operates the online market and hospitality which is accessible through the websites and mobile apps. The firm has its headquarter in San Francisco and help members access or arrange for lodging, tourism or homestays ( Chayer& Lunsford, 2018 ). Despite being behind the key players in the industry, Airbnb is the rapidly growing firm in the industry. The company is using a localization strategy to expand to the global markets and compete with the leaders in the industry. This is mainly done by focusing on helping local travelers find the best hotel for accommodation. Its current growth is also attributed to its diversity because the website is diverse in listing and can be accessed by almost everyone wherever they are. It is free to sign up and list space in the Airbnb. The listings are usually available on the sites, and one can post the entire houses, rooms in beds and airbeds in apartments ( Chayer& Lunsford, 2018 ). To go global, it has opened its market space to the entire world to do listing. 

The company is expanding into the Asian markets especially in Japan and China. Japan is becoming a crucial growth market for accommodation providers due to the rapidly increasing number of international visitors. Seeing this as an opportunity, Airbnb is expanding into Japan market using partnership strategy known as Airbnb partners. This is a program which creates a partnership between Airbnb with 36 Japanese businesses including the already established service providers and loyalty programs that can help it host ( Chayer& Lunsford, 2018 ). This is a strategy aimed at ensuring that the firm grows rapidly into the Japanese market by taking advantage of the already existing well-established businesses in Japan. Japan is the destination for many visitors and could help accommodate more lodging and provide hospitality services to many guests. It is the country in the entire Asian region with the highest demand. In 2016, Airbnb accommodated 3.7 million tourists, representing 15% of all the international tourists in Japan. This shows how the firm’s strategy is working well on its favor to expand its market share in the country. 

Airbnb is focusing on quality and best experience for its customers to compete well into global markets. To compete with the local firms in Japan, Airbnb focuses on ensuring that the private accommodation experience is exceptional both for the hosts and guests. Due to the high demand for quality from the customers, Airbnb provides the most exceptional experience for its customers. The localization, as well as the partnership strategy, has helped the firm expand its market share both in the United States and in Japan (Chayer& Lunsford, 2018). It provides the best offer price, enhances customer satisfaction and offers registration from Twitter or Facebook which offers good support for hosting or staying. These strategies have ensured that the company penetrates and grow both in the local and international markets thus increasing its market share and competitive advantage. 

The traveling and hotel industry is increasingly becoming dynamic. Due to the development of technology, firms within the industry have to keep on changing with the new technology as every time, the expectations of the customers are changing and failing to respond to the changes could lead to business failure. The online traveling agencies are responding to the industry dynamics by introducing mobile apps and data analytics as they take marketing to the next levels by increasing connectivity between the hoteliers and guests. These changes ensure that the firms remain on track with the changes in the industry and continue providing the best services. 


Chayer, T., & Lunsford, R. (2018, March). Revolutionizing the Sharing Economy: How Airbnb Changed the Travel Industry. In  6th International Conference on Innovation and Entrepreneurship: ICIE 2018  (p. 111). Academic Conferences and publishing limited. 

Guo, X., Zheng, X., Ling, L., & Yang, C. (2014). Online coopetition between hotels and online travel agencies: From the perspective of cash back after stay.  Tourism Management Perspectives 12 , 104-112. 

Law, R., Leung, R., Lo, A., Leung, D., & Fong, L. H. N. (2015). Distribution channel in hospitality and tourism: Revisiting disintermediation from the perspectives of hotels and travel agencies.  International Journal of Contemporary Hospitality Management 27 (3), 431-452. 

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