Airbnb’s Marketing Journey to Build a Global Community: A Case Study

Founded in 2008, Airbnb is a marketplace where people share private spaces all over the world to be rented for the short term. The spaces are mostly apartments, villas, houses or castles for a unique travel experience available at various prices, and have grown in more than 81,000 cities and 191 countries of the world.

Today, we are going to discuss the story of a fresh, new peer-to-peer vacation rental platform that spread their marketplaces service through the world via creativity. Airbnb developed competitive brand communication strategies that transformed the world into a global community. So, when you lookout for the best places to stay-in on Google, you will come across Airbnb amongst the top searches.

The idea of Airbnb originated when founders Brian Chesky and Joe Gebbia realized an opportunity in renting out an air mattress in their living room to people visiting San Francisco for a conference. The idea then evolved to become a platform that offered short-term living quarters, breakfast and a business networking opportunity for those who were unable to book a hotel because of saturation in the market. In February 2008, Brian Chesky contacted his former roommate Nathan Blecharczyk, for developing the website which was named AirBed & Breakfast. Nathan Blecharczyk joined as the Chief Technology Officer and the third co-founder of the new venture.

The official site Airbedandbreakfast.com was launched on August 11, 2008. The venture served their first customers in town in the summer of 2008, during the Industrial Design Conference held by Industrial Designers Society of America, where travellers had a hard time finding the place to stay in the city.

As they were starting out in the summer of 2008, the founders needed a way to raise money. They bought a ton of cereal boxes and designed special edition election-themed boxes- The Obama O’s: The Breakfast of Change, and Captain McCain’s: A Maverick in Every Bite. Every box was sold at convention parties for $40 a box. The cereal box idea went down in the Airbnb start-up story as it kept the company afloat for a few more months. The proceeds from the cereal boxes almost pulled the company out of debt and gained Airbnb some national press coverage.

In November 2008, the famous venture capitalist Y Combinator founder Paul Graham was not convinced about Airbnb’s business model but was impressed by the presidential-themed cereal boxes and saw spirit and passion in the founders. The company’s inclusion in the Y Combinator program pushed Airbnb founders to focus on making the company profitable. With a clear goal, seed funding of $20,000 and a better work structure, founders of the start-up decided to travel to New York- where a majority of their community was located. Airbnb focused on developing relationships by uploading high-quality images of the properties, creating an unforgettable experience for its customers and guiding the hosts to engage the guests in the best homestay experience. By the end of the Y combinator program, the founders were able to create a market of loyal customers who not only loved the company but also helped the company grow its customer base. They were also able to secure a $600,000 funding from Sequoia Capital and Y Combinator. From this point, Airbnb was unstoppable and expanded out of America, and today, it has a worldwide presence in the hospitality industry.

Business Model of Airbnb

Airbnb is an aggregator-based business model. The hospitality brand does not own any property and yet is amongst the largest accommodation providers. Airbnb’s business model is based on the needs of the community, which is simple, innovative and effective.

Having the relevance of an economy-based model, the online platform serves the two categories of audiences. Under the 1st category, Airbnb enables owners to list their property on the website to earn revenue by renting it out, and under the 2nd, travellers looking for accommodation can choose from the properties listed on the Airbnb website.

Customer satisfaction and low rental prices are the main factors which have led Airbnb on its path of success. The brand has set its own set of community standards and they are mandatory to be followed by owners of the spaces. An aggregator-based model always makes profits from various sources. Let’s have a look at how Airbnb gained huge profits:

Airbnb’s Revenue Model

Airbnb offers free listings to property owners and lets travellers browse the listed spaces and select the one which best suits their needs on the platform. All transactions are carried out on Airbnb’s platform. Let’s have a look at the way through which Airbnb earns: –

• Owners of the Property
  Airbnb charges a flat 10% commission from owners for every booking made through the platform. The platform also earns through payment processing fees. The usual payment processing fees is 2% while Airbnb charges 3% for the same. The additional 1% is levied by the owner of the property.
• Travellers
  Airbnb charges a non-refundable fee up to 20% of the booking total, that is set as a service fee by Airbnb for travellers for every confirmed booking.
• Airbnbmag
  Airbnbmag is a magazine product that the company has started. The idea behind the $15 magazine is to help the traveller discover the place through local’s eyes.
• Business Travel
  Airbnb also provides the spaces for the travel managers of the companies that have certain requirements like, home type, amenities, check-in, reviews, responsiveness, and owner’s commitment.

Due to its unique features and great customer service, Airbnb has created a well-reputed image worldwide and is increasing its base every day. When it comes to giving a competition, the brand has devised various digital marketing strategies to gain wide popularity on online platforms. With the help of best digital marketing services, they have kindled the excitement and craze in the people to travel and host.

Digital Marketing Model of Airbnb

As Airbnb wanted to target the people of every generation, they leveraged various digital marketing tools that helped them in building a reputable online presence and a bigger community. They adopted top-digital marketing strategies, if you are looking for the same, you must consult the best brand activation agencies.

Airbnb is more than a Procure-to-Pay accommodation provider. With the aim of building a larger community, Airbnb leveraged various integrated marketing strategies to build trust. Creating a community has also simplified the booking process. Users must create their profile when they first sign up but after that it’s as simple as entering their payment details. It is also the authenticity of the experience that makes Airbnb such a successful community.

Now, let’s have a look at the digital marketing strategies adopted by Airbnb:

1. Website Development: As Airbnb relied mostly on their website for booking and sales, it was important for them to provide their customers with a clearer look with easy-to-use navigation. By leveraging the best website development services, they added a host of personalisation features which turned out to be a complete game changer for the brand. They were able to make the booking processes easier than ever.They added high-quality images of their properties, essential information related to booking, additional product information, availability, reviews, supplier information (Host, Neighbourhood), Policies/T&Cs and other such related products to enhance the customer experience.
2. Paid Search Marketing: Airbnb attracts approximately 12% of traffic via paid search. By investing in paid search marketing as a part of their digital marketing strategies, Airbnb has been able to capture one website visitor for every two visitors from organic searches. They have paid attention to keywords, landing pages, important messages, ads and Calls-to-actions messages.Their most of the spend goes towards the terms that feature “accommodation” as the chief keyword. Their ad copy speaks to their unique points of difference and so stands out from their competitors. When it comes to landing pages, they mostly feature local imagery to help provide a more relevant result.
3. Email Marketing: With the aim of increasing reservations and prompting customers to book their next travel adventure, Airbnb leveraged the power of email marketing services to remind their users that the hospitality brand is a one-stop-shop for organising a memorable holiday, so that users become familiar with not only booking their accommodation via Airbnb, but also activities while they’re in a new city. They made use of itinerary emails, emails which consisted of experiences of other users.
4. Search Engine Optimization: To establish brand presence, Airbnb drove the traffic organically by leveraging best search engine optimization services. They attracted the audience through search engines- by ranking for words which included “accommodation” in their keywords. By using intelligent search engine optimization strategies, they optimised their whole website to compete against the organized hospitality industry competitors.
5. Social Media Optimization: Nowadays, social media platforms have become an integral part of the digital marketing strategy. If you want to connect with your audience in real-time, then it is best to establish your brand image across social media platforms. As social media plays a vital role in the lives of the people, Airbnb decided to leverage the best social media optimization services that made them earn billions. They made use of following platforms:
   • Facebook
     Through creative social media optimization strategies, Airbnb has managed to reach 16 million likes on Facebook. They leveraged various types of ads like feature ads, facebook ads, video ads. Airbnb’s timeline consists of various types of user-generated posts. They have adopted the policy of dynamic remarketing by spending their budget on users which show interest in the ads and are likely to convert them into leads.
   • Instagram
     Airbnb’s Instagram page is highly visual and showcases the vast array of beautiful properties they have on their platform to inspire wanderlust in potential travelers. Their posts are clever, creative and leverage a number of features within it to make sure their followers actually engage with their content. Guests can share their experiences with #airbnb and even book a rental place directly from the feed.
   • Twitter
     Airbnb uses Twitter to promote its blog posts and extraordinary listings. Their hashtag #belonganywhere is quite popular. They keep their feed updated by posting timely content. Airbnb posted a 4.5-minute movie on Twitter using short video clips from Vine.
6. Brand Partnerships: Airbnb has shown many times that partnering can cause some serious impact on the audience. Brands get to offer something unique to the customers. Successful partnerships include KLM Royal, Dutch Airlines, UK bookstore chain, Waterstones and even the French government.In partnership, a contest was created where the winners could spend a free night in a luxury ‘Airplane Apartment’.With the French government it was a night in the Paris Catacombs at Halloween, which helped raise the profile of a lesser-appreciated French tourist spot.
7. Influencer Marketing: Airbnb leveraged the power of creative influencer marketing strategies and invited journalists, bloggers, YouTubers, podcasters and Instagram stars to the event. In 2015, Airbnb hosted a ‘floating house’ publicity stunt on the Thames River in London with a variety of related events including a #FloatingHouseParty where attendees were encouraged to live stream, take pictures and splash the night all over social media. The result of the event was 70,000-page hits, 10,000 new users and more than 200 million social impressions.
8. Inbound Marketing: With the help of integration of Craigslist, the two platforms drove more traffic and business. Craigslist was being used by people to offer and look for short-term housing. Airbnb decided to attract qualified leads and reverse engineered Craigslist form to make the two platforms compatible. Whenever anyone listed accommodations on Airbnb, they got an option to automatically create a posting on Craigslist as well. They helped create additional inbound links for the user.
9. Blogs and Storytelling:
   • blog.airbnb.com is an informative repository for travellers. The Local Lens section is dedicated to individual narratives just like the Stories section on their website.
   • Storytelling: The brand has the stories section on the website which consists of various video profiles of hosts and travellers, their stories as to why they rent out their place and the motivation of travellers to leave their homes and travel the world with Airbnb.
10. Referral Marketing: Airbnb encouraged its users to refer new members to Airbnb via email invites. They rewarded the referrers with a $25 travel credit when new members completed their first trip and a $75 credit was offered when they acted hosts for the first time. This way Airbnb converted new leads and had to pay out for referrals only after new users paid. This allowed Airbnb to grow in a sustainable manner.

Digital marketing has been working very well for Airbnb, with over 470,000+ followers on Twitter and 2,750,000+ followers on Facebook, just to mention a few. Airbnb has been successfully able to disrupt the Travel & Hospitality Industry. It has redefined how people interact with one another when travelling. There are many campaigns that have helped Airbnb establish its image and have touched the values of the people.

Campaigns done by Airbnb

• ‘We Accept’
  In 2017, Airbnb responded to accusations that some of its hosts were discriminating against guests on the basis of race and gender by introducing a non-discrimination policy on their site. “We Accept” campaign was launched to underpin Airbnb’s long-held values of community-led and culturally diverse travel.

• Experiences
  The online marketplace introduced thousands of new ‘Passion Categories’, such as food and drink, concerts and sports, across thousands of new locations by the end of 2018. To increase awareness of this added functionality, Airbnb collaborated with brands like Vice and Pantone to produce immersive experiences.

• Freedom in Goa
  With this campaign, we wanted to give travellers a new experience to discover new places and explore new cultures, on their terms which is what Airbnb truly is all about.

1. “Live There” Campaign
   In 2016, Airbnb further developed its brand proposition, rooted in travel, communities, people and experiences. In 2016, Airbnb further developed its brand proposition, rooted in travel, communities, people and experiences. Airbnb “Don’t Go There. Live There.” from TBWA Worldwide on Vimeo.

Conclusion
Aribnb’s success lies in the fact that people have adopted the brand among the favourable choices. As they strive continuously to create special and memorable experiences for the customers, the brand has become a choice of many in the global market.

Airbnb is a great example of how start-ups do not have to be sold to other large companies as they can be capable of becoming a global product that changes the lives of millions of people. They have handled their digital marketing game smartly by analysing various prospects of the brand communication strategies, and continue to do so.