Ingenious Marketing Success Stories
Airbnb, the online marketplace for booking and renting private accommodation, has become a symbol of the sharing economy. Ten years after it was founded, with a current estimated US $ 30 billion in value, the company and their mission called Belong Anywhere have transformed the tourism industry – causing stirs and controversies abound along the way …
According to the company’s founding myth, Brian Chesky, Joe Gebbia, and Nathan Blecharczyk came up with the idea for Airbnb when supplementing the high rent on their San Francisco apartment by renting out overnight airbeds. In 2008 the website airbedandbreakfast.com went online, and in 2009 first investor funds were secured. Nowadays, Airbnb is a versatile tourism company that not only offers private rooms and apartments, but also special events and business travel accommodation. The company’s value is estimated at $ 30 billion and it employs a global team of 3,000. Despite numerous controversies such as resident protests or allegations that they fuel the housing shortage in popular tourist cities, Airbnb’s success remains unabated. The brand still enjoys high popularity among travelers and landlords. Here are a few reasons why …
Touching on a human need
First and foremost, Airbnb was a way of securing oneself cheap private accommodation. But the big breakthrough came with the later-developed mission and corresponding marketing campaign: Belong Anywhere! Those who travel to other cities or countries, even for pleasure, can feel lost, or labeled as a “tourist” in foreign surroundings. With their offer to stay with friendly locals rather than in an anonymous hotel, Airbnb spoke to the deeply human need for belonging and home. In addition, they used the millennials’ hunger for “authentic experiences”, away from mass tourism traps. Add in a cheaper price, and this was a convincing mix.
“Airbedandbreakfast.com” went online in 2008 but initially attracted little interest from investors. So the founders were forced to finance their own business idea, including by selling breakfast cereals for the Obama presidential campaign. Their ingenuity eventually impressed angel funders Y Combinator enough to invest $ 20,000 in 2009, despite their doubts about the business model. However, Chesky, Blecharczyk and Gebbia did not give up. Influenced by a surging demand for affordable accommodation driven by the economic crisis, as well as a growing supply of unusual overnight accommodation, the company kept growing steadily. At the end of 2010, finally, they secured themselves the support of investment giant Sequoia Capital – 7.2 million USD. A breakthrough was achieved.
Innovate to enrich the product
During their short history of 10 years, Airbnb have consistently expanded their offer and have developed into a versatile tourism company. In addition to the core product (guest room with shared bathroom), whole apartments and also extravagant accommodation options such as igloos or tree houses are on offer. At the end of 2016, privately held events were added, offering exclusive experiences organized by locals, from paella cooking to meeting wolves. Next steps: Deals for business travelers who demand a higher standard and a suitable place to work. Also introduced was a high-priced premium category * and even an airline was announced by the founders.
Staying flexible when facing challenges
Airbnb has every reason to diversify. With accelerating growth, the company is repeatedly confronted with criticism: Airbnb is blamed with fuelling the shortage of housing in cities such as London, Barcelona or Amsterdam, and also for overburdening “authentic neighborhoods” with more and more tourists. Also, hotels protest against Airbnb’s unfair competitive advantage because of not having to fulfill regulations and safety requirements. So far, the company has taken these hurdles in their stride, staying on track for the IPO which is planned for 2019, and without losing much sympathy as a brand. It remains to be seen where Airbnb is headed for the next 10 years.