Airbnb SWOT Analysis and Identity Verification

Contents
1. Airbnb Introduction.............................................................................................. 2
2. Airbnb SWOT Analysis.......................................................................................... 3
3. Identity Verification.............................................................................................. 5
4. Opportunities:...................................................................................................... 7
5. Porter’s Five Forces Analysis (Airbnb)..................................................................9
6. Threat of substitutes.......................................................................................... 10
7. References......................................................................................................... 12

1. Airbnb Introduction
The popular global online platform for short-term accommodation lodging and
tourist experience, also known as “sharing economy” Airbnb, has markets in more
than 190 countries, 34,000 cities, 1.5 million hosts and receive above 50 million
guests each year. Airbnb is valued at 38 billion with over 164 million bookings
(Forbes, 2018).
The unrivaled company’s mission of “home away from home” is appealing to the
mass market, benefits, empower millions of people to become hospitality
entrepreneurs and disrupted the hotel industry by providing a flexible an alternative
option for accommodation on demand.
A successful business model with superb technology platform to facilitate millions of
travelers each year, Airbnb diversified its potential streams of revenue to steadily
attract investors to develop new travel products that will heighten investments and
power long-term growth.
The strong executive team has forged key partnerships with government regulators
and policymakers to ensure continuous agreement in allowing its business to run
sustainably across the globe.
Beyond this year, Airbnb further its platform and prepare for its Initial Public
Offering in 2020.
Airbnb BMC:

2. PESTLE Analysis:
Political environment
The political environment will definitely have negative impact on the overall
operations of the company. This is due to the fact that this is a multinational
organization that is operating in different countries with different political
environments. The political environment gives results to the legislature, rules, and
regulations applicable to a business organization. In addition to the rules and
regulations applicable to business organizations operating in rental housing market
can be more complicated as compared to other industries. Therefore management
will be required to research and keep themselves updated about rules and
regulations in order to protect themselves from political factors.
Basic business concept of Airbnb is based on sharing economy. With the help of its
business activities this organisation has been creating jobs and opportunities. On
the other hand it is also affecting current industry model in which traditional
organisations are operating such as hotels. Pressure from large scale hotel
organisations are also affecting the manner in which politicians are taking decisions
with respect to operations of business organisations like Airbnb. One of the
primary reason that rules and regulations on this type of organisation are very strict
as compared to other hotel organisations.
Economic factors
Economic factors will have a positive impact on overall operations of the company
as overall structure of the company can be altered in accordance with the economy
in which it is operating. One of the primary advantages of using Airbnb is that it
helps in providing cheap rental alternatives to people. In addition to that they can
also help in providing luxury services to the customers (Sedlacek, 2016). Therefore
it can be said that this organization will operate in any kind of economy whether
such economy is stagnant, developed or growing.

Organisations like Airbnb are affecting the economy in positive manner by creating
job opportunities and source of income for homeowners. On the other hand it is
affecting the hotel industry in negative manner as similar services as hotels are
provided by Airbnb at lower cost.
Social environment
The current social environment of different countries will be helpful for growing
business of Airbnb. This is due to the fact that significant proportion of customers
are willing to use services of Airbnb as they are tired of renting hotels and motels.
Business organizations like Airbnb help in providing different experience which is
generally preferred by the customer (Della Corte, 2016). The social attitude of
customers is changing significantly and it will have positive impact on growth
perspectives of the company. Airbnb also provide home away home experience to
their end customer where they make guest as home to bonding with other
neighbourhood in another city.
Technological environment
One of the most important factors that are contributing to the success of business
organizations like Uber, Airbnb other online platform organizations is advancement
in technology. In addition to that frequently used of mobiles and internet is
providing platform for customers as well as suppliers in case of Airbnb. Any person

can list their house on Airbnb and customers can rent out these houses after
agreeing to the terms and conditions of the renter (Pan, Le and Wenting, 2018). It
can be said that technology will always have positive impact on this type of
organization. It’s give an opportunity to their guest and host to utilize service over
finger tips.
Legal environment
The legal environment can have negative impact on operations of the company as
legal environment of each country in which it is operating will be different from each
other. The business organization will be required to analyse legal requirements
provided by government of every organization and business strategies accordingly.
The impact of the legal environment will not be very high if it is managed in
effective manner by hiring legal experts in each of the countries.
Business concept of air b and b is unique and different from other service sector
organisations. Introduction of new business concept is always very difficult from
legal perspective as it result in development of new rules and regulations
specifically applicable on unique businesses such as Uber and Airbnb. In addition to
that Airbnb is also required to follow all the rules and regulations in relation to
tourism of each and every country in which it is established. Management of
different rules and regulations will be very difficult for the organisation. For
example, people are not allowed to rent out their properties in New York unless they
are living there. In several cities homeowners are required to pay tourism tax if they
are renting out their property to tourists. It can be said that legal environment will
have a negative impact on operations of the company.
Environmental factors
Operations in business organizations like Airbnb will not have a significant impact
on consumption of energy and other resources that are essential for environment.
Various studies have been conducted and it was identified that consumption of
electricity and other resources in hotel industry is significantly higher (Kuo et.al,
2016). It can be said that these industries will not have any problem to deal with
environmental laws and regulations in different countries. Another research show
that Airbnb guest consume much less water, electricity and other service which help
us make echo friendly.