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End-to-end SWOT Analysis of Airbnb | IIDE

by | Case Studies | 0 comments

The original title of the most popular home rental company is “Air bed and breakfast”. It is none other than Airbnb. The company is the world’s most popular accommodation website valued at over $35 billion as of 2019. Being the largest known brand in the world and serving for more than a decade, Airbnb has come a long way by facing all the ups and downs in the business.

This SWOT Analysis of Airbnb focuses on explaining the strengths, weaknesses, opportunities, and threats. So let’s start by learning more about Airbnb. 

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About AirbnbAirbnb Logo | SWOT Analysis of Airbnb | IIDE

Airbnb is an American online marketplace and a hospitality brokerage company, which was founded by Brian Chesky, Joe Gebbia, and Nathan Blencharczyk in August 2008 in San Francisco, California. Airbnb is present in about 192 countries. It owns no real estate nor does it hosts many events.

Airbnb is an online community marketplace that lists travellers to local hosts.  The company allows people to rent out, find out, and book accommodations for a less term basis. It also allows people to share their extra space and to produce extra income.

The firm provides a platform for local hosts to lodge guests by providing short-term lodging and tourism-related activities. Guests will have the option to search from various filters like type of lodging, dates, price, location, and can it be specific with types of homes, vacation homes, bed, and breakfast. The hosts post details like price, location for rent, number of guests, rules, home types, and other amenities.

Hosts set the prices with recommendations from Airbnb. Both hosts and guests can leave reviews about their experience of stay. Users may be verified through an online presence by connecting with their google or other social media accounts accepted by Airbnb.

Now that we know about Airbnb in brief, let us understand the SWOT Analysis that Airbnb deploys to achieve its business goals and customer connect in the coming section.

 

SWOT Analysis of Airbnb

A SWOT analysis is a method that helps to collect a company’s strengths, weaknesses, opportunities, and threats as the acronym suggests. The primary motive of a SWOT analysis is to help organizations develop a full awareness of all the factors involved in making a business decision. 

 So let us begin by understanding Airbnb’s SWOT Analysis which has been staged according to its acronym. 

Airbnb Hotel Wallpaper | SWOT Analysis of Airbnb | IIDE

 

1. Strengths of Airbnb

Strengths are the first aspect of SWOT Analysis. It deals with the positive side of the company. . This tells how the brand can improve itself using its advantages over the business. 

Let’s gander some of the major strengths of Airbnb. 

  • A Worldwide Well-Known Brand: Airbnb is well known all around the world, and it is the biggest asset for this company. It is more popular than any other travel brand. Airbnb’s online search popularity surpasses all the competing brands. The popularity of the brand is priceless in the competitive travel industry.

     

  • Cheaper Yet Unique Alternatives: Airbnb is known to be a cheaper alternative to other resorts and hotels. The prices for the services can be competitive based on the location of the place. Customers can shop around and can choose the place that suits their budget.
  • Engaged Guest Community: Airbnb’s community is its greatest asset. The experience of Airbnb is its personal touch of hosts and the interaction with them helps guests to engage with the Airbnb community. It also offers customers rewards and specials.
  • Global Connections: Airbnb’s global network of guests and hosts allows it to expand easily. The company is present in 220 countries and regions, it helps it thrive on cross-border travel and in terms of good global connections. The brand has huge hosts and guest count all over the world.

This concludes the part of strengths. So let’s see the weaknesses of Airbnb in the upcoming section.  

 

2. Weaknesses of Airbnb

Weaknesses are the negative internal factors that affect the company. This causes the brand to lose to its competitors. Now let’s look into the weaknesses of Airbnb. 

  • Global Pandemic: Due to Covid-19, most countries are on lockdown which had put a stop to Airbnb’s business due to rules and regulations in local areas. Also, people are afraid to come out of the house due to the novel coronavirus.

     

  • Lack Of Quality Controls For Hosts: Airbnb is almost everywhere but there is no standard of quality control which creates problems such as less comfort and cleanliness. Poor hosts can damage a company’s reputation. If in any case, any host does not comply with Airbnb guidelines, they can face the consequences. Poor ratings and Backlash on social media hit the company’s profit in the current business world.
  • The Objectivity Of Guest Review System: Airbnb has a review system, wherein hosts and guests can rate each other after their stay. But both hosts and guests are not able to see their reviews when both have given reviews.
  • Maintaining Brand Awareness And Reputation: Airbnb’s biggest assets are brand awareness and reputation. They have to keep it up to stay ahead of the competition. It has been criticized for higher prices for stay. The retail price has increased in a few areas due to keeping properties of the long-term rental market and instead of that getting higher rental rates for short-term housing through Airbnb.

Airbnb has to keep its brand image with a good reputation to maintain its position in the business. Now that we’ve learned about its weaknesses, let’s get to know about the opportunities of Airbnb in the below section.

 

3. Opportunities of Airbnb

Airbnb wallpaper | SWOT Analysis of Airbnb | IIDE

Opportunities are the best and most possible aspects that can upgrade the company. Chances make the brand get better and better. Opportunities for Airbnb are mentioned further down. 

  • Recovery From Covid-19: Since the world is recovering from covid-19, the scope for the travel industry will increase in the upcoming months. As people want to leave the house and freshen their minds, travelling would be a great option.

     

  • Brand Investments: Airbnb with the brand investment can enter in other segments as car rentals, advertisements, travel guides, etc to keep up its business at its peak.
  • Global Expansion: Airbnb is already competing globally but still can increase its reach in countries like India, China, Latin America, and other Asian countries. Airbnb can also expand into emerging markets with less competition. This could provide a huge business opportunity for Airbnb.
  • Innovation: Airbnb can improve on making the platform more appealing and can improve engagement for both hosts and guests. As the usage of the mobile app increases, Airbnb has developed a mobile app that will facilitate the hosts and guests to get connected easily.
  • Offerings: Investing in innovation will improve interaction with hosts and guest interferences.  Airbnb has a better chance to expand its product mix and offerings and customers can be more satisfied. It can also introduce travel guides, car rentals, etc

These are the conceivable prospects that can be seized by Airbnb. Let’s tear it down and understand the last part of SWOT Analysis – threats of Airbnb. 

 

4. Threats Of Airbnb

As the competition rises and the company expands, Airbnb has a lot of threats to look out for, such as laws in different countries and states. Some of which are as follows:

  • Decreased Travel Demand: Due to the worldwide pandemic, the whole travel industry is suffering and so is Airbnb. Because of the lockdowns, buying power of people has decreased and this impacts on decreased travel demand.

     

  • Increased Competitions: Airbnb tries to stand out as a powerful player in attracting hosts and guests. Yet some hosts can decide to use some of the competitors, and often cross-list their offerings. Airbnb has been facing heavy competition in some sectors in some areas by companies like Flipkey, HomeAway, tripping.com, Trivago, etc.
  • Laws and Regulations in Every Country: Airbnb operates in around 192 countries. Each state and country has its laws that Airbnb has to comply with. Airbnb has to rely on hosts and guests to rely on so that they could meet local laws.
  • Decrease of Acceptance of home-sharing: Home-sharing may become less popular as a result of cultural factors, which could hurt Airbnb’s competitiveness. Also with the COVID-19 pandemic, people are more hesitant in home-sharing.

With this, the SWOT Analysis of  Airbnb comes to an end. So let’s conclude the findings below. 

 

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Conclusion

 

Thousands of people have used Airbnb during their travels. Airbnb, which was founded in 2008, has changed the way we travel and how trust and authentication are established between two parties.

Its explosive growth has made a strong business with a $35 billion valuation. Airbnb has well-positioned its marketing methods in place to attract new expansions in the years to come, despite the high price tag it charges its consumers.

Did you enjoy our work? Are you curious to learn more? Please visit IIDE’s website for more updates.

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Lead Trainer & Head of Learning & Development at IIDE

Leads the Learning & Development segment at IIDE. He is a Content Marketing Expert and has trained 6000+ students and working professionals on various topics of Digital Marketing. He has been a guest speaker at prominent colleges in India including IIMs......[Read full bio]

Aditya Shastri

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