Analysis of Covid-19 Impact on Stakeholder Retention for Airbnb's Success

This report analyzes the impact of Covid-19 on stakeholder retention for Airbnb's success. It discusses the challenges faced by the travel industry, evaluates the present condition of Airbnb, and suggests effective strategies for stakeholder retention.

ANALYSIS OF CASE
STUDY

Executive summary
The travel industry is facing so many hurdles due to the pandemic. The result of the
pandemic is that it has ceased the operations of the travel industry. The restrictions on the
entertainment and fun has resulted into decrease of the performance of the Airbnub company.
This projects aims to identify the problems that is being faced by the travel industry due to the
pandemic. The main hurdle that is being recognised is that it has reduced the retention of the
stake holders in the company because they are not sure to invest more in the company. This
report is basically about giving the sources and steps that can be followed to provide success
and growth to the travel company in the present market scenario.

INTRODUCTION
Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................2
Situation description....................................................................................................................2
Statement of the problem............................................................................................................3
Evaluation present condition faced by the Airbnb......................................................................4
Classification of analysis along with ideas of the generation and alternatives solutions which
are best fit for issues and problems within organisation.............................................................6
CONCLUSION................................................................................................................................8
References:.......................................................................................................................................9
1

The project is framed to examine the Covid 19 impact in maintaining the stakeholders for
providing the success of the organization (Anguera-Torrell, Vives-Perez and Aznar-Alarcón,
2021). The project would discuss about the impact of the Covid 19 on the present travel industry
that is Airbnb. The company Airbnbv is a hospitality and travel company which was established
in the year 2008. This company bridges the link between the needy person who needs home and
the person who has vacant houses. In this way, it services to both the parties. The project would
study about how Airbnb has been facing problems in Covid 19 pandemic time period. It would
also discuss about the different literature reviews and sources in order to gain the effective
information for the organization performance. It has also outlined the strategies and
recommendations with respect to this.
Aims
For examining how Covid 19 pandemic has effected in the retention of stake holders for the
growth and success of institution.
Case study on company Airbnb.
Objectives
For studying the needs of retaining of stake holders for the success of the company Airbnb .
For examining the effect of Covid 19 pandemic on the development of revenue of Airbnb.
For identifying the effectual strategies for stake holders holding for the success of Airbnb for the
longer period of time.
MAIN BODY
Situation description
This case study is related to the Airbnb that is a service oriented institution that offers
property owners to rent the houses and properties to other people against the rent. The company
forms a bridge between these two people. It was established in 2008 by two college friends
named as Gebbia and Chesky. The headquarter of the company is situated in California, US.
There was a sudden hike in the performance of the company of about 8% in 2010 and 2011.
After this, the company established its various institutions at various different places all over the
globe. But when the pandemic came, the company experienced a sudden fall in the performance.
Due to which, the stakeholders were not ready to retain in the company (Chen, Law, and Zhang,
2

2021). The problem is to make sure that the stakeholders must retain in the company in order to
develop and grow it in the future.
Statement of the problem
To analyse requirements of the stockholder's retention for Airbnb's success
As per the (Zhu and Cheng, 2021), stakeholders are most significant individuals for any
organisation that monitor, control, direct or invest time or efforts with the purpose of
reattainment of the trust within organisation. Business firms like Airbnb has an essential market
share and an effective growth in its revenue as it has innovative idea that make enable it in give
rental space facilities in order to find house and destination for its customer. There are various
stakeholder of an organisation including communities, hosts, employees, guests and investors.
All these stakeholder are main pillars of a business success. Before pandemic, around 2 billion
dollars as an investment for a short time periods has been accomplished by the respective firm.
Company has raised this investment to manage their operational performance. Loan has been
sanctioned by investors and other stakeholder as they believed in getting a suitable or decent
return on their investment because Airbnb had an effective vision or mission for a loner time
period. As respective company is able to function smoothly by building trust and configuration,
so it is very beneficial for its stakeholders (Fung, Tsui and Hon, 2020). Airbnb is facing issue of
customer's retaining and its stakeholder are not providing satisfactory facilities on sites. It is
analysed that customer had battered home and rental space that impact the respective company
adversely. Airbnb is also lacking in maintaining a healthy environment which is a major
challenges for respective company.
To identify impact of the COVID 19 on revenue's growth of Airbnb
As per the (Shen and Wilkoff, 2020), Pandemic create various ups and downs for the
tourism or hospitality industry. Companies like Airbnb had also face negative impact of the lock
down and COVID 19. this situation has slow down the revenue's growth of respective company
as customer's were cancelling their booking due to lock down. Tourism or hospitality industry
face a hug loss as various business were shut down due to which company as unable to pay a
return on the investment. It create a conflict among between the organisation and other parties.
Due to COVID 19, there was an inflation within entire economy that lead to a reduction in
purchasing power as stakeholder were not able to contribute in business success. As resulting,
there was a low capitalism within Airbnb. By this impact of a low capitalism respective firm is
3

unable to provide better services to its customer. Due to which, customer shift on other
companies. Thus, company has face a big loss that impact its revenue's generation as well as
profitability (Guo, and et. al., 2022).
To examine effective strategies for reattainment of the stake holders in success of Airbnb
for a long term
According to the (Polisetty and Kurian, 2021), it is identified that stakeholder are most
significant partners of a business that need can be satisfied with the purpose to get a success in
business for a long time period. Therefore, it become compulsory for the organisations like
Airbnb that they make proper strategies so that customer's involvement or stockholder's
participation can be improved. By following the safety regulation properly, company can attain
this objective. Airbnb need to promote its services constantly after COVID 19 and make
different efforts to attract customers in large number. Respective company should maintain a
healthy relation with its suppliers, customers and other communities as these key stakeholder can
increase potential of respective company (Hsieh, Chen and Wang, 2021). For this Airbnb
should undertake various strategies so that an effective bond can be established with the
stakeholders. There should be particular law framework for the customers. By providing online
services via website company and make application in which complete details about rent space
are provided, company can attract more customer. By this practice of respective firm, its
customer will not face any searching problem as they can visit on company's website and search
for their required service. It provide a positive customer experience. Therefore company should
give best and effective facilities to the customers that not harm sentiments and intentions of its
stakeholders ad will be awarded e with better services and profitability. Along with the
respective comp[any need to conduct a study that present latest of the market within tourism or
hospitality industry after pandemic.
Evaluation present condition faced by the Airbnb
Airbnb's innovative business ideas has generated a great sale within short time period.
Their ideas attract more and more customers across the world-wide. It facilitate a platform for
various organisations like Airbnb where company can advertise its product in most attractive and
innovative manner. In order to promote the properties, various travelling agencies exploit the
websites. Airbnb has also uses the Booking.com and Advisor platform in order to rent the houses
and spaced to customers. Thus, online agencies of travelling reduce the customer's bargaining
4

power and established a positive or reputed image of their hotels. In this, Airbnb has faced
various problems, which are mentioned below:
 It has been observed that online agencies had faced many challenges during COVID 19
as it decrease their revenue. In relation to Airbnb, the pandemic situation has directly
impact its sales generation and profitability. Due to this the business operation of
respective company get influenced. Travelling agencies had face various difficulties
when making any payment, giving employee's salary, payment of mortgage and many
more. Thus, it was a very tough situation for the Airbnb as customer were cancelling their
trip plans that impact the company's operating in a negative way. To maintain the
business reputation, company need to return the amount back to their customer otherwise
it may damage the company's goodwill within marketplace (Lim, and To, 2022).
 Airbnb is facing difficulties in making effective relations with the stakeholders as they
operate the hotel's chain but enable to pay the tac like other business organisation. They
has also make a collaboration with other properties but still not capable to fulfil the
taxation requirement that crate a negative image of the respective company. Another
major challenges for Airbnb is that various other business are providing same services
that create major issues for the respective company. Strategy and polices of the company
should be formulated in such a manner that make enable the respective firm to compete
with its rivals effectively.
 Local host of Airbnb are its strength as they support the company in functioning a smooth
working practices. But due to certain reasons, if hosts are not able to provide a great
experience to its customer then it may decrease the company's profitability. When
customer post any negative comment on social media then it impact the company's
reputation in a negative manner as it provoke the other customers to cancel their booking.
Sometime, various guest demand unnecessarily that occur a high charge for the
hospitality organisation which is not affordable for every tourism or hostility company. If
there is any issues in check in or checkout due to which customer get a negative
experience then it also impact the company's operation. It may also influence its brand
image within market place (Manoharan and et. al., 2021).
5

Classification of analysis along with ideas of the generation and alternatives solutions which are
best fit for issues and problems within organisation
During COVID 19, Airbnb had faced various difficulties as pandemic has bring down
company's revenue on a regular basis. Therefore, it become significant that company make
efforts to overcome such adverse situation. For this they had to get a control over large area
within market. Airbnb came up with a unique idea which is adequate to satisfactory the
customer's expectation and want to make a good travelling experience. As COVID 19 had
impacted the business working, so Airbnb had enforced several solution so that they can win
over this worst situation. Few of their practises are mentioned below:
 Airbnb should put a check on the entire market activities with the motive to neglect all
the negative reviews or comments from social media sites as it impacting company's
revenue. This practice of company will play a significant role as it support them in
maintaining its brand reputation through out the globe as resulting it will enhance
revenue or profitability of respective firm (Reichenberger and Raymond, E.M., 2021). It
make enable the comp[any to evaluate the unforeseen obstacle or challenges that is going
to be vital to facilitate the market sustainability fro long run. Now company is reviewing
the productivity or performance based on weekly or monthly basis. By this they can find
out their mistake and alter this in more effective manner. It help Airbnb in altering their
working process or plans that satisfy the community including customers, host,
stakeholders and shareholders.
 To overcome form this situation, it will became very essential for Airbnb that it establish
a good relationship with its stakeholders and supply chain as it support the respective
company in attaining its target (Zhang and et. al., 2022). For this, they need to make a
plan of the contingency with the purpose to increase level of providing customer's
services. In order to make a control over large market area or to enhance the market
share, various stakeholders has collaborated with the Airbnb and become host. Based on
the requirement, host has authority to bring changes and customise the company's
services in order to engage the customers throughout the world. They had take a step to
6

maintain a proper and effective infrastructure which is lookalike as it shown in picture
(Sanjeev and Tiwari, 2021).
 Another major solution for Airbnb is that it should follow all the safety regulation
seriously as it help them to win over the impact of COVID 19 pandemic. For this, firstly
company will regulate all the guidelines and polices for properties so that requirement of
pandemic rules can be fulfilled. Is is mandatory that Airbnb follow all the government's
regulation so that customer's perception can be changed in context of respective
company. Its hots and other properties need to fulfil the fixed criteria by maintaining
social distancing and wearing mask (Wong and et. al., 2021). It is also essential or the
respective company that it maintain hygiene within workplace so that customer's trust can
be build for organisation. It will enhance the booking for Airbnb's services that leader to
generate more and more profit.
7

CONCLUSION
From the above report it is concluded that pandemic hit the hospitality and tourism
industry in a negative ways. It create various major challenges for these sectors that become
hinder in attaining success and meeting the customer's needs. In this circumstance, there is a
situation of low market working. Due to this, investors, stakeholders, board of directors and other
collaborative partner did not show any interest to work with the company's policies. Moreover,
employees turnover and negative attitude of customers towards the companies reduce the firm's
share within market. Hence, to face such situation, various organization like Airbnb had take few
step and overcome from the negative situation of pandemic very efficiently.
8

References:
Books and Journals
Anguera-Torrell, O., Vives-Perez, J. and Aznar-Alarcón, J.P., 2021. Urban tourism performance
index over the COVID-19 pandemic. International Journal of Tourism Cities.
Chen, S., Law, R. and Zhang, M., 2021. Review of research on tourism-related diseases. Asia
Pacific Journal of Tourism Research, 26(1), pp.44-58.
Fung, C., Tsui, B. and Hon, A.H., 2020. Crisis management: A case study of disease outbreak in
the Metropark Hotel group. Asia Pacific Journal of Tourism Research, 25(10),
pp.1062-1070.
Guo, L. and et. al., 2022. Recovering hotel room sales during the COVID-19 pandemic: lessons
from OTA information using the quantile regression approach. Current Issues in
Tourism, 25(1), pp.94-114.
Hsieh, Y.J., Chen, Y.L. and Wang, Y.C., 2021. Government and social trust vs. hotel response
efficacy: A protection motivation perspective on hotel stay intention during the
COVID-19 pandemic. International Journal of Hospitality Management, 97, p.102991.
Lim, W.M. and To, W.M., 2022. The economic impact of a global pandemic on the tourism
economy: The case of COVID-19 and Macao’s destination-and gambling-dependent
economy. Current Issues in Tourism, 25(8), pp.1258-1269.
Manoharan, A. and et. al., 2021. Career optimism of culturally and linguistically diverse hotel
workers in the pandemic age. International Journal of Hospitality Management, 93,
p.102796.
Reichenberger, I. and Raymond, E.M., 2021. Students’ perceptions of tertiary tourism education
and careers during the Covid-19 pandemic. Journal of Teaching in Travel & Tourism,
21(4), pp.380-402.
Sanjeev, G.M. and Tiwari, S., 2021. Responding to the coronavirus pandemic: emerging issues
and challenges for Indian hospitality and tourism businesses. Worldwide Hospitality
and Tourism Themes.
Wong, A.K.F. and et. al., 2021. How the COVID-19 pandemic affected hotel Employee stress:
Employee perceptions of occupational stressors and their consequences. International
Journal of Hospitality Management, 93, p.102798.
Zhang, S.N. and et. al., 2022. Would you enjoy virtual travel? The characteristics and causes of
virtual tourists’ sentiment under the influence of the COVID-19 pandemic. Tourism
management, 88, p.104429.
9