Airbnb is engaged in providing online hospitality services, and enable people to rent or lease short-term lodging which involve vacation rentals, homestays, apartment rentals, hotel rooms or hotel beds. The company itself does not have any owned lodgings, but it acts as a broker and work on commission basis. It has more than 3,000,000 listings of lodgings in more than 65,000 cities in 191 countries (Airbnb, 2017).
Airbnb is able to work on such large scale and ultimately able to gain competitive advantage over its competitors. The biggest competitive advantage it has is about its effects of the network. It means, the greater number of hosts are listed on Airbnb, the greater number of the guest it will have, and so greater number of booking will be done by guests through Airbnb, the more number of host it will get. Whereas, the supplies are built by the competitors, word of mouth, reviews of people on the given lists, and this make Airbnb different and unique from its competitors. There is no any barriers of entry, but late entrants are facing difficulty in beating Airbnb in the industry in geographical aspects. However, Airbnb still have to work hard on achieving competitive edge on niche inventory and other complementary (Porter, Michael, and Gibb, 2001).
Services provided by Airbnb are very latest manifestations of disruption in the industry of travel lodging. It has brought the change in the traditional system of intermediaries like travel agents, who are now replaced by Airbnb or Google (automated ones). Airbnb has a competitive advantage from traditional agents as it is able to provide a variety of options, direct interactive channels, and easy access to information. Airbnb has invested largely in the (ICT)-Information Communication Technology, which helped it in gaining many online customers (Lessin, Jessica, 2012).
Airbnb is also unique in a way that it has helped customers in terms of reduction in the transaction costs by using its ICT. It also brought C2C model in an industry which was operating only with the traditional B2C model. It is often considered as cybermediary, which means a business which get benefits from global reach, technological economies-of-scale and learner cost-structure, the outcome of which is the large volume in lower costs of transactions. Airbnb, is unique in providing a platform for the people who are looking for rental places. Airbnb is gaining the advantage over its cost structure, which is commissioned bas, a particular percentage is provided to it by the host and the customer while being booked or booking a place (Porter, Michael, and Gibb, 2001).
Airbnb is able to grab the largest market share by being attractive offers and good quality services. It works on the connectivity basis and its value of connecting with the network, is completely depending on number of connected people. Airbnb, provide the best quality services that it mostly receive good reviews with the people and its customers are quite satisfied with its services (Lessin, Jessica, 2012).
References
Airbnb, 2017. About us. [Online], Available at: https://www.airbnb.com/, [Accessed on: 17th December, 2017].
Lessin, Jessica, 2012. “Thiel in Talks to Invest in Airbnb at $2.5 Billion Valuation.” Wall Street Journal. N.p., [Online], Available at: https://www.wsj.com/articles/SB10000872396390443684104578066811794775602, [Accessed on: 17th December, 2017].
Porter, M.E. and Michael; ilustraciones Gibbs, 2001. Strategy and the Internet.