Making Hospitality Authentic

How do the four characteristics of

services apply to Airbnb? How does
Airbnb deal with each
characteristic?
Intangibility Variability
Quality vary depending on who
Not seen, tasted, felt,
heard or smelled provides them and when, where
before they are consumed and how they are provided

Inseparability Perishability
cannot be separated cannot be stored for later sale or
from their providers use
 Intangibility

Outcomes Rating systems

not known Photos
until
Videos
experienced
 Inseparability

Customers can choose

Hosts provide: preferred:

Unique authentic Environment

experience
Hosts
Sense of belonging
Surroundings
 Variability

Experiences differ by:

Airbnb provides:
Hosts
Lodgings Guidelines to follow

Locations Rating system

Cultures
Feedback system
 Perishability

Experience gained while Pictures and videos

Staying in lodgings
can capture
some elements
Interacting with hosts.
But not the
experience
Not earlier, not later
Apply the service profit chain
concept to Airbnb.
 Service Profit Chain

The chain that links

service firm profits
with
employee and customer satisfaction
 Service Profit Chain

Internal Service Quality

Satisfied and Productive

Service Employees

Greater Service Values

Satisfied and Loyal Customers

Healthy Service Profits and

Growth
 Service Profit Chain

Customer Contact End Customers

Employees

HOSTS GUESTS
 Service Profit Chain

Better Employee
Selection
Internal Service
Quality
Hosts are filed and evaluated to
ensure their legitimacy
 Service Profit Chain

Sense of Ownership
and
Satisfied and
Belonging
Productive
Service
Employees
Hosts are considered the
most Important Customers
of Airbnb
 Service Profit Chain

Better Host-Customer
Interaction
Greater Service
Values
Employee Satisfaction
leads to providing better service
to the customers
 Service Profit Chain

More Returning Customers

Satisfied and Satisfied customers tend to

use AirbnB more
Loyal Customers and this
mitigates the fear of living
with strangers
 Service Profit Chain

Increased Profit and Growth

Healthy Service
Profits and Increased customer base leads to more
Growth profit and growth in business
How does Airbnb differentiate its
offer, delivery, and image?
Service Differentiation

Offer

Delivery

Image
 Service Differentiation
Accommodating customers
with rooms, houses provided
by local people
Differentiated
OFFER Facilitates customers to experience as
a local habitat than a tourist
 Service Differentiation

Verified hosts who are

knowledgeable about the
Differentiated local culture
DELIVERY
Facilitates accommodation in distant
places which are out of reach of any
luxurious hotel
 Service Differentiation

Differentiated Belo
IMAGE The Universal Sign of Belonging

A new slogan that accompanies

the logo
BELONG ANYWHERE
How much of a threat is competition
to Airbnb?
 Threat

Offer secured services

Luxurious servicing possible

Hotels Traditionalists prefer this

Easier process

No cultural impact
 Threat

Can copy the procedure

Others like Airbnb
Can be an alternative for the same
system
How Airbnb is doing with the threats

Variety Rating system

Secure transaction Location

Culture Hospitality
 Others

Followers can’t be leaders Already a established brand

1st mover’s advantage Loyal Customer base

 Verdict

Very Low Threat

Will Airbnb last as long as Hilton
Worldwide has? Explain.
Hilton Hotels and Resorts

Since 1919
 Major Obstacles in Sustainability
Major Obstacles

Competitors’ Rules &

Entry Regulations

Cultural Adaptation

Expectation & Safety &

Reality Security
But, Let’s Look at the Positives…

Market Initiator Continuous

Improvement

Differentiated Target
Customers

Growth Rate Brand Positioning

 Brand Positioning

Delivery
Differentiation
Offer Image
Differentiation Differentiation
 Verdict

High Probability of
Sustaining
THANK YOU!