Army Institute of Business Administration (AIBA)

Jalalabad Cantonment

SUBMITTED TO:
Shahriar Tanim
Lecturer, AIBA Sylhet.

MARKETING ANALYSIS SUBMITTED BY:

Sakif Ryhan – 26
Marketing Management
MKT - 2402 Nishat Salsabil Chowdhury – 07
Rahat Hussain – 05
Ahsanul Mahbub Jubayer – 10

Date of Submission:
November 12, 2017
 Letter of Transmittal
12th November 2017
Shahriar Tanim
Lecturer,
Army Institute of Business Administration (AIBA)
Jalalabad Cantonment, Sylhet.

Dear Sir,
With due respect, we would like to inform you that we are honored to prepare our report on the
marketing analysis on Airbnb as required for our BBA program.
This report shows the SWOT analysis, competitors’ analysis, marketing strategies and
marketing mix on Airbnb. Including brief company overview, along with some
recommendations and conclusion. In our report, we tried to focus on the relevant information
of the business and gained depth knowledge and information about the given topics. We tried
our best to show our skill. Finally, we would like to assure you that we will be there for any
clarification, explanation whenever required.
Therefore, we believe the report will serve for its best purpose and hopefully this report will be
accepted. Thank you in advance for your kind assistance.

Sincerely yours,
Nishat Salsabil Chowdhury – 10316007
Sakif Ryhan – 10306026
Rahat Hussain – 10316005
Ahsanul Mahbub Jubayer – 10316010
Batch: BBA-3
Army Institute of Business Administration, Sylhet.

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 Table of Contents
Serial Content Page
No. No.
1 Executive Summary…………………………………………………………... 3
2 Introduction…………………………………………………………………… 4
a. Mission Statement……………………………………………………… 4
3 SWOT Analysis……………………………………………………………….. 5
4 Industry Analysis Analysis…………………………………………………… 6
a. Porter’s Five Forces……………………………………………………. 6
5 Marketing Strategy…………………………………………………………… 7
a. Market Segmentation…………………………………………………... 7
b. Market Targeting………………………………………………………. 7
c. Market Positioning…………………………………………………….. 7
6 Marketing Mix……………………………………………………………….. 7
a. Product………………………………………………………………… 7
b. Price…………………………………………………………………… 7
c. Placement……………………………………………………………… 7
d. Promotion……………………………………………………………… 7
7 Financial Analysis…………………………………………………………….. 8
8 Recommendation……………………………………………………………… 8
9 Conclusion…………………………………………………………………….. 8
10 List of reference………………………………………………………………. 9
11 Appendix……………………………………………………………………… 11

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 EXECUTIVE SUMMARY
To connect the people globally and to encourage people to travel, Airbnb provides
accommodation facilities and travel experiences. This business is operation online through a
mobile application. Airbnb has more than 30000000 listing and wide range of accommodation
facilities, including – hotels, hostels, apartments, rest house etc.
This paper contains the overview of the company. How the business is performing. Their
marketing analysis. A SWOT analysis along with a competitors’ analysis is done to better
understand the current market scenario. In this report, we will look through what are their
marketing strategies and the marketing mix (product, price, place and promotion).

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 INTRODUCTION
Airbnb is a privately owned company. Established in February 2008 by Brain Chesky (CEO)
along with Joe Gebbia and Nathan Blechaczyk (Bloomberg, n.d). It is situated in San Francisco,
California, USA. These company serves in 191 countries, which includes 65000 cities through
online market place exclusively for travelers (n.d). There hospitality service includes – giving
lease o rent for staying in lodge, apartment, hotels etc. Basically, they are the broker which
provides accommodation facilities for people and also bring customers for hotels and lodge
(Solomon, 2016).

MISSION STATEMENT
Airbnb’s mission is to provide a trusted online marketplace where clients have the ability to
list or book living spaces across the globe, making traveling experiences both unique and
affordable for each one of their clients, as well as allowing clients to “monetize their extra
space and showcase it to an audience of millions(Airbnb, n.d)”. The core value of Airbnb is
“Belonging” or to “Belong anywhere (Airbnb, n.d).” “For so long, people thought Airbnb was
about renting houses. But really, we’re about home. You see, a house is just a space, but a home
is where you belong (Brian Chesky, co-founder, Airbnb).”

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 SWOT ANALYSIS
STRENGTHS
 Skillful & Large Workforce – Airbnb have large workforce. They have about 450 number of
employees from Europe only (Smith, 2017). Airbnb provides their employees with latest
technology and recruits the best and talented people to work with them. Moreover, provides
area for an optional work environment (n.d). These is how they manage to have skilled
workforce (Airbnb, 2014).
 Airbnb Has A Strong Portfolio – they have a portfolio that shows, the company own 660000
properties, serve about 9 million guest/tourist in 2013 (Airbnb, 2014).
 They Are Concern For Customers – Airbnb focuses on giving customer value and
satisfaction. Customers can contact Airbnb anytime because they are ready to offer service and
help customers 24 hours a day. In order to connect with people globally Airbnb has 30
languages available. So that customers will feel more comfortable connecting then (Airbnb,
2014).

WEAKNESSES
 High Cost – they are already facing a high cost. Now, if price of rental house or other
apartments rises their cost it is likely to rise (n.d). Furthermore, the tax Airbnb need to pay the
government is quite high and these reduces the income. Also, the company is taking loan and
the interest cost is also increasing the cost even more (Hahn 2015).
 Lack Of Research And Development – They do not have enough fund to invest in R&D.
thus, there is a lack in variety of products and services they offer (Hahn 2015).

OPPORTUNITIES
 Usage Of Mobile Device Is Rising – Per annum the increase in usage of mobile device has
raised 44% (Airbnb, 2014). That is why, more people will have access to Airbnb application.
Airbnb is likely to become more popular and there is high possibility that their customer will
increase every year.
 Market Expansion – Although Airbnb is operating in 191 countries (n.d). They can provide
services to other countries as well where they have no activities. Global market is available to
them. Also, their business is concentrated in Europe and America. Thus they can operate in
other counties of Asia (n.d).

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 Merging With Other Businesses – If Airbnb integrates with airline companies or have
contracts with travel guides. Consumers will feel safer and secure travelling with Airbnb. They
can trust and relay on the company. These will attract large number of customers and will
reduce possible inconvenience (n.d).

THREATS
 Recession – Demand for Airbnb will fall and cost will rise significantly in recession period.
And these is a threat for Airbnb to face huge loss or suffer bankruptcy.
 Low Barriers To Entry – New Company with similar product or service idea can enter and
may gain competitive advantage over Airbnb. Though competition may lead the company to
reduce market share (Krotoski, 2014).

INDUSTRY ANALYSIS
We are doing the industry analysis by using the porter’s five forces tool. This how we will get
know the bargaining power of buyers and suppliers, the competitors, substitute and new
entrance of new company. Porter’s five forces includes five points. According to the points
the industry analysis is given below.
Competitors’ Rivalry: The rivalry between competitors is not high. We know that there are
other services like Airbnb but those are not successful and large like Airbnb (Seely, 2015).
Threat of new entrants: The threat of new entrants for Airbnb is average in amount. We often
think that opening an application and starting through that is very easy but sometimes it’s not
like that. To be competitive a new entrant needs high amount of capital (Seely, 2015).
Bargaining power of customers: Bargaining power of customers is below average in amount
because now customers don't have any good choice rather than Airbnb. There is also no other
option for customers to get the benefit of group buying (Seely, 2015).
Bargaining power of suppliers: This is also very low because Airbnb operate the connection
between the customer and hotels. There's nothing to make a union for these suppliers. There
are a lot of suppliers for Airbnb. They get easily their information because even the suppliers
are somehow relying on them (Seely, 2015).
Threat of substitutes: The threat of substitutes is high, because customer can easily switch.
It’s not a big deal for a customer to find and choose hotels and rental services (Seely, 2015).
Besides Airbnb there are a lot of website and application provide these information. For
example: hotels.com.

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 MARKETING STRATEGIES
1. Market Segmentation – Different people have different kind of hobbies and interest. Airbnb
is choosing the right kind of accommodation to the right people. They are basically doing two
type of segmentations. Those are, psychographic and geographic. They are segmenting the
people who love to travel, who have a huge interest of travelling. On the other hand they are
gathering information of hotels of different countries. That’s why they are doing the geographic
segmentation to gather mass information about different region, different countries.
2. Target Market – Airbnb is targeting both customers (who are the travelers) and the host (who
are the hotel, apartment, lodge, and rest house owners). Airbnb is an intermediary and knows
that both targeted people need one another (BizTalk 101, 2015).
3. Market positioning – Airbnb has positioned in the mind of travelers/ tourist as being
“reliable”. Customers review were positive and they feel safe and secure when booking
through Airbnb. Through Airbnb they can get a place with outmost security (BizTalk, 2015)

MARKETING MIX
1. Product – Airbnb provides limited number of services, Such as – giving a place to stay (hostel,
hotel and other accommodation) for customers. And make the work easy for the customers in
finding proper accommodation. Also, provides other travel experience, such as – scuba diving,
sky diving or inform the customers what they can do in this holiday season (n.d). Airbnb now
has a listing of 30 lacks (n.d). With 6 lacks 40 thousand hosts (Smith, C, 2017, October 31).
Including 78000 rental apartments and 47000 home listing (McGreal, May 10, 2017).
2. Price – Airbnb’s main source of income is to get commission and service fees from the hosts
they do not take any money from their consumers directly for the service being provided (n.d).
And 55% people think that Airbnb is cheaper than that of competitors (McGreal, May 10,
2017).
3. Placement – Airbnb is an online based business. They connect people globally and give them
a sense of belongingness. Airbnb is active in 191 countries and 65000 cities (n.d). The app is
very easy to use and the access of mobile device and internet users is also rising. Airbnb has
over 4 million registered users. And expected that the site will reach to 6 million registered
user by the end of this year (Moore, 2014). They now have 90 local websites (n.d).
4. Promotion – To make the company well-known by users. Airbnb mainly use online
advertisement as it is an online based company. They partner with Google and had the access
to talk with global customers. Also, expanding their business (ThinkWithGoogle, 2011). They

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are doing social responsibility management by giving support and donation to the poor people
in 2012. They are also sponsoring many events (n.d).

AIRBNB FINANCIAL ANALYSIS

Airbnb is a website and mobile app that helps people to rent a room in hotels sitting on their
home also to become a host for the customer. Airbnb user can register and create a profile,
and then they can rent out hotels rooms (Tarver, 2015).
After investing $1 billion capital, Airbnb is valued now roughly $24 billion. Airbnb's most
recent funding, the company forecasted revenues of $850 million for the fiscal year 2015
(Tarver, 2015). Through the strong performance in 2015, Airbnb raised that forecast to $900
million. From there, the company forecasted its revenue to grow to $10 billion by year-end
2020. (Tarver, 2015).
Airbnb disclose its profit in the second half of 2016 and expects they will maintain it through
2017. Airbnb is the fourth-most valuable company (Booton, 2017). Revenue at Airbnb
increased more than 80% during 2016 (Bloomberg, n.d).

RECOMMENDATIONS
1. Airbnb Can Increase Their Services: Airbnb can introduce new services for travelers.
For example: Tourist Map, Tourist Guide. They could provide guide to the traveler as
a representative of Airbnb.
2. Invest In Research & Development: They can invest their retained earnings in R&D
sector for further improvement. Through this they will get know their customer and
host better.
3. Minimizing The Rental Cost: During non-seasonal period they can minimize the
rental cost. It will definitely increase their users or customer even it will encourage to
become a host for Airbnb.

CONCLUSION
Airbnb is a very successful service oriented company at recent period. The demand of
traveling is increasing among people. They are capitalizing this huge opportunity and
making people life better and secure. Proving a secure place in different region in the
world also giving a great service is the real mantra of their success. They are fulfilling
the demand of this generation people who loves to travel. Keeping the service this
efficient and effective will be more beneficial in future for them and for their customer.
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 REFERENCES
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 APPENDIX (A)

Fig: AIRBNB New User Increasing Rate.

APPENDIX (B)

Fig: App Page Screenshot.

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 APPENDIX (C)

Fig: AIRBNB Web Page.

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