Airbnb’s Background
Airbnb is an American company that provides short-term rental and accommodation services. Since its founding in 2008, Airbnb has found a comfortable niche and expanded significantly, generating over 8 billion dollars in revenue in 2021 alone (Hati et al., 2021). As the company continues to expand into new markets, it faces challenges in complying with local, state, and international regulations and in addressing ethical issues in customer treatment.
The proposed strategy for Airbnb is to address local and state regulations proactively, while international regulations are to be followed through standardization and global compliance. Ethical compliance can be assured through the adoption and implementation of customer-centered ethical guidelines. Finally, the strategy would feature a separate international component focused on local partnerships and a localized approach.
Airbnb’s Ethics
Airbnb has faced issues regarding the ethical treatment of customers and partners throughout its business journey. For example, there have been instances of customers being settled into suboptimal lodging. There were also many issues with untrustworthy customers treating their hosts poorly (Hati et al., 2021). These issues can be resolved with an ethical framework focused on quality assurance, customer support, trust and safety measures, and community standards.
The ethical framework should aim to maximize happiness for all parties and take a utilitarian approach (Dimitriou & Schwepker, 2019). Verification of lodgings, documents, and backgrounds would ensure the safety of customers and hosts, while agile customer support could resolve any ongoing issues quickly (Hati et al., 2021). These measures could be further fortified by enforcing anti-discrimination and responsible hosting practices.
Internal Environment
Airbnb’s competitive position regarding its internal environment is strong – the company originated in the US and knows its market well. Its name has become synonymous with short-term lodging, and it controls the majority of that sub-market. Nevertheless, the US has varied regulations at the local and state levels, which Airbnb should be mindful of (Hati et al., 2021).
The proposed strategy revolves around proactive engagement with these regulations. By creating dedicated teams in each region, the company could build positive relationships with authorities and lobby for more beneficial regulations (Hati et al., 2021). This could be accomplished by cooperating with the government for information sharing and hosting educational events.
External Environment
While Airbnb enjoys a strong competitive position in its home market, its presence outside the US is more precarious. Many businesses are mirroring its business model. At the same time, Airbnb enjoys a strong, well-known brand, which it can leverage to gain a competitive advantage (Hati et al., 2021).
The proposed strategy here revolves around global compliance, standardization, and transparency. By coordinating efforts across regions, Airbnb can quickly become the largest database of hosts for both customers and service providers. Regulations regarding short-term lodging may be different from one region to another.
Some of the challenges include limited time for lodging and the quality of accommodations. For comparison, a lodging in the US would be, on average, larger and more comfortable than in Vietnam (Hati et al., 2021). Standardization and transparency would help overcome these challenges and ensure compliance with local laws, thus repeating the success the company had in the US.
Evaluating the Probability of Success
Airbnb has a high probability of success for its strategy implementation plan. It has the brand name, the capacity for adaptation, and experience working across different states to advance a competent international strategy. Nevertheless, the company should pursue a separate international component strategy for different regions of interest.
The business model should suit the specific needs and cultural norms of individual localities. This could be done by forming local partnerships, emphasizing diversity and inclusion, and being prepared to adjust the company’s standards for global compliance (Hati et al., 2021). Finally, the company should research each market individually and offer a range of products suited to that market. Thus, having just one strategic plan would not be enough; each element should have its own.
Reference
Dimitriou, C. K., & Schwepker Jr, C. H. (2019). Enhancing the lodging experience through ethical leadership. International Journal of Contemporary Hospitality Management, 31(2), 669-690.
Hati, S. R. H., Balqiah, T. E., Hananto, A., & Yuliati, E. (2021). A decade of systematic literature review on Airbnb: The sharing economy from a multiple stakeholder perspective. Heliyon, 7(10), 1-21.