Business Case Study: Insider Tips on Airbnb's Best-Kept Secrets

There was once a time when we were told to stay away from strangers. We were told not to post personal information online, and most importantly,  never stay at a stranger’s house. Today, we not only talk to strangers online, we also book their houses for an overnight stay. The year 2008, when unemployment reigned all over, could you think of starting a startup then? Not at all. But there’s a company that not only started during this recession, but it has beaten big hotel groups like Hilton, Taj etc.

to become the world’s biggest accommodation provider. Airbnb, a company that started in recession, today it rules the hospitality industry. The interesting part is,  the company doesn't own any houses or hotels nor does it manage them. The company only earns money. Very few people know that there are 9 similar startups. But rarely any of us has even heard about them.

The question is, what is Airbnb doing that no one is able to compete with it. And most importantly, what are the powerful business lessons that we can learn from this case study and implement in our business. The story starts in 2008. When Lehman Brothers crashed, the world went silent. Everything kind of stopped. The company's crash led to lakhs of people being unemployed.

There was sadness and silence everywhere. Brian Chesky and Joe Gebbia, the recession didn't spare these interior designers either. Just overnight, their rent increases by 25%. Not only that, they had to attend a design conference in San Francisco. But alas, they don't find a place there either as the rooms were booked. They returned disappointed and they were out of money, so they couldn't pay their extra rent.

Brian rented an extra bed in his room to solve this. He earns some money and pays the rent. But who knew that Brian's trick for survival would one day become such a huge business? After this incident, Brian and Joe decide to list their service online and this was how Airbnb was born. It started out by renting an empty room in their house but seeing its potential, Brian decided to list other houses with empty rooms too. But you know what?

If you'd heard this idea then, you might have laughed. Because when people can't even talk to strangers, would they have let a stranger stay at their house? While the rent increased, people were losing their jobs. Due to this, in order to pay their bills they had no option but to rent their extra rooms.  And as a result, it was as if Airbnb won the lottery. The startup rejected by more than 20 investors, had a growth that shocked the investors.

But seeing Airbnb's success, similar startups entered the market. Tripping. com, hometogo, onefinestay, flipkey  and many similar startups entered this space and prepared to compete with Airbnb. The year 2013. It had been 5 years since the business started, and the situation was very heated now. Things were now very difficult for Airbnb and the company was going through a delicate phase.

But then, suddenly something happens, something that opened doors of fate for Airbnb. 2013, it had been 1 year since Instagram started. As soon as people got free Internet, people started observing the digital world more closely. Now, everything was changing very rapidly. Airbnb did something that shocked everyone. So now listen to this very very carefully.

Airbnb's entire business is dependent upon these two. Number one, host. That means the person whose home people go to. Number two, travellers. The customers who stayed at people's houses. A very big challenge was in front of the company.

The challenge was not only to keep both hosts and travellers very happy but also to invite more such players to the ecosystem. The simplest and easiest way to do this is spend a lot of money to bring more of them to the platform. But the company's main problem was that it didn't have a lot of money.  So what did the company do? Well, the company created a powerful cycle system. First of all, the company started training hosts.

So, hosts were able to provide good service to travellers. Its ripple effect was that whenever a traveller stayed with a host, the traveller would be impressed with their service. Moreover, they also saw that the host not only provided good service,  shared their culture and enjoyed with me, but also earned money alongside. This would motivate the traveller as well to host their property on Airbnb, if they had any. As a result, by training their hosts well, not only more travellers came, but the travellers also got converted to hosts. I know what you are thinking.

Airbnb's competitors are doing the same thing, so what's unique about Airbnb? The answer to this is personal connect. Very few people know that Airbnb does a lot of digital marketing. And they're so good that no one can compete with them. Many of us still think of digital marketing as SEO that is, Search Engine Optimization. But the truth is, it's only a small part of digital marketing.

To acquire customers fast, Airbnb used Craigslist integration. Craigslist is an advertising website where people search everything, from jobs to housing. They reverse-engineered this to increase compatibility and integrated both the platforms. Thus, when a short term housing ad is on Craigslist, that information would go to Airbnb. Now, Airbnb would recommend them their host program. This not only brought more hosts to Airbnb but also provided additional inbound links, which brought more traffic to their website.

Google Ads. Very few people know this but when Google started its advertising services, their first customer was none other than Amazon. Then, no one trusted Google Ads  but people saw Amazon's growth due to Google Ads, and Google got many advertisers. Now, everyone wanted to run their ads on Google. Airbnb, from the very start, took the help of Google Ads, especially search ads. There were only 10,000 people visiting their website, due to Google Ads, their traffic reached 80,000.

Do you know the problem? Nowadays, people think of SEO, PPC and SEM, and consider this their entire digital marketing. And this happens a lot with young people like us. We often learn about digital marketing but due to lack of certification, we don't get a job. But not anymore. With mycaptain, you can learn digital marketing and become a certified digital marketer with 100% job guaranteed.

Whether you want to build your digital marketing career as a fresher or you want to upskill yourself, in both the cases, mycaptain's DM pro course, leading industry experts who have worked in Google, Zomato, peppercontent etc. , will give you access to them. And the course itself is curated by experts at  Filtercopy. People in the current batch are placed well making somewhere between rupees 3-8 lakhs/annum. Intensive training for 4 months based on 8+ projects. You'll get to learn a lot from it, from Search Engine Optimization, email marketing and specifically, Google and Facebook ads and more.

Mycaptain's expert consultants will guide you so that you can also become a pro digital marketer. You can also check out mycaptain and become a pro digital marketer. The competition was growing day by day. Every competitor was riled up seeing Airbnb's success. As a result, some even spread propaganda against it.

But, when everyone was trying to destroy Airbnb, Airbnb had already started working on its next strategy. The strategy was called content management. Any brand's content library has 2 types of content. Number one, team content. This is the content prepared by their team, such as blogs, posts, banners, videos. All these are created by the company's internal team, it's done by their creative team.

The second type of content is user-generated content. This is the content that the company is not involved in. It's generated by the company's users. Its biggest benefit is that  the company only has to share this pre-made content and the company gets free publicity. Airbnb put only 30% focus on team content and the rest 70% focus was on user-generated content. To implement this, they first ensured that hosts provide good service to their travellers.

Moreover, the travellers not only get good facilities but also get good support for travelling. When Airbnb's travellers got all these services, they started posting about it on their social media. They started posting about the place they stayed at. The company got 2 benefits from this. Number one, an increase in publicity. Number two, an increase in host revenue and in turn, as Airbnb works on the commission model, when the host earned more, Airbnb profited.

I know what you are thinking. Why would any traveller do this for free? Well, the biggest reason is personal connect in community. Whenever a traveller does something like this, their personal connect with their community increases. For example, imagine I posted on my community tab or you are watching this video, so your personal connect with me is increasing. The same thing happened with travellers when they posted about their travels on Instagram or Facebook.

Not only that, in every locality,  Airbnb collaborated with the local city guides there so that whenever a traveller stayed at Airbnb, the city guide could help the traveller. What are the nearby popular cities? What are the popular neighbourhoods nearby? So that the traveller staying at Airbnb has an even better experience and they connect with the company more. The comapny created a customer engagement loop by providing travel help. When the company provided travel help to the customers these travellers would engage more with the company.

They would get converted to super loyal customers. And moreover, not only super loyal customers they would also go on to become brand advocates, that is, they would tell people about Airbnb for free. The company would get free marketing from this. And as a result, the company gained more customers. Pineapple, a print magazine people used to read at tea time. People started sharing their Airbnb travel stories here.

Whoever read these stories would connect with the company as well as the traveller. Whenever you build such a connection with someone, you get very fascinated by their journey and you also want to experience such a journey. Many of us still think of Airbnb as a stay provider. But the truth is, Airbnb is not a stay provider but rather a travel support company. On 6 continents, it has 3000+ freelance photographers who click high quality photos of the sights. These high quality photos attract attention to a host site.

With higher attraction, the host earns more rent. Airbnb profits more with high rents. From good Google reviews to 7 million+ indexed pages with a combination of user-generated content, Airbnb has all these things. Due to this, as compared to competitors, the company neither has to create content nor perform SEO. Most brands run the same piece of content  on different social media platforms which makes them think they're working a lot but they don't get any results from it. But from the start, Airbnb's social media strategy was different.

If you see their Instagram, it'll look like a travel diary. Their YouTube is full of travel vlogs which gives out an adventurous vibe. Their Twitter has everyday slangs which increases your connect with the comapny. Airbnb has created such a customer loyalty that people not only want to use Airbnb every time but they also tell people about this for free. This brings us to the most important thing. What are the powerful business lessons that we can learn from this case study and implement in our business.

First lesson, the myopia of knowing it all. When most of us succeed, we think we know everything. We know it all. But as a result, we often make business decisions that prove to be very harmful to us. Second lesson, you are your own competition. When Airbnb started, there were 9 similar startups.

Everyone wanted to make Airbnb lose. But Airbnb never focused on its competition. Their prime focus has always been to improve themself. It's more beneficial to improve yourself than to make your competitors lose because you are your biggest competition. Imagine you worked hard to make a 90,000 crore company. You have become the country's 3rd richest person.

But suddenly something happens and your company starts crashing and something happens in your company that many people are unaware of. This is the story of Videocon. What happened to Videocon? What is the company's truth? If you want to know this, then do read the article on the right.