Airbnb's Success: Market Development, Restrictions, and Implications

This essay examines Airbnb's market development strategy, highlighting its rapid global expansion and the regulatory challenges it faces in various countries. It discusses how Airbnb, as an online marketplace for lodging, has disrupted the traditional hospitality industry, leading to opposition from hotels and local governments. The essay further explores the implications of these challenges, including potential fines, the formation of new laws, and the need for Airbnb to tap into unsaturated markets. Despite these restrictions, the essay argues that Airbnb's superior services, global reach, and ability to facilitate online bookings position it for continued success and potential market dominance. Desklib provides access to similar essays and study resources for students.

Running head: AIRBNB
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Introduction
Airbnb is one of the largest online marketplace and hospitality service offering the
organization. Although it’s a company that does not own any lodging, it enables individuals lease
and rent lodging for a short-term period. This company targets more so tourist and those visiting
new places for vacation and offer them vacation rentals, apartment rental, homestays for
immigrants, hostel beds and hotel rooms. Generally, we can state this company acts like a broker
since it owns none of the above property of its own. This company is known to be growing very
fast globally and benefiting from both sides of the customers, that is the people who want to
access accommodation and those who own the property offering accommodation. Both parties
pay some commission. It’s a huge company now having a list of more than 30000 lodgings in
more than 200 countries. The company has managed to market and develop its services at these
fast and in different new geographical areas due to the employment of market development
strategy. However, the company is facing lots of opposition different countries due to regulation.
(Coldwell, 2014) The reason behind the opposition is basically because it’s preventing business
owners owning this accommodation service company to Flagg and lack market.
From a research point of view, this company is in position to overcome these restrictions.
Though it is facing and will face the challenge it may end up penetrating the market and even
practice monopoly type of market ownership. This is so since the company is an online platform
that offers services and people don’t need to travel to book for the house. The booking,
negotiations, and payments are domes online. This, therefore, makes its customers work easier
and they will definitely prefer this service than traveling to look for the service manually. The
company can also succeed because it has excess production of its service. This company is not
limited to only one geographical area and therefore the restriction to some part does not mean

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that the rest have restricted. It has good services and that what it's selling and advertising.
Moreover, the company will manage to stay in the market since its already successful and
already offering better services than its readily available competitors. It’s offering reliable and
cheap accommodation services to its customers. Lastly, the company can manage despite the
restriction by tapping other markets that are unsaturated apart from lodging. It can seek for other
markets in a global view. (shatford, 2015)
Implications
 The company will face lots of pressure from the hotel industry
 The company will face opposition from local governments in some countries with
allegations for breaching of local tourist laws and this may cost them fines
 Its growth will lead the formation of laws that will also affect local subscribers offering
the same service in their cities, e.g. like some countries are already passing laws limiting
renting and leasing houses for shorter periods. (KEYSER, 2016)
 It will lead to the realization of the better market since they will be in a push to look for
greener pastures in terms of the market.
 They will be subjected to taxation (Coldwell, 2014)

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Works Cited
Coldwell, W. (2014, July 08). Airbnb's legal troubles: what are the issues? Retrieved 11 30,
2017, from the Guardian: https://www.theguardian.com/travel/2014/jul/08/airbnb-legal-
troubles-what-are-the-issues
KEYSER, R. (2016, Oct 24). A Guide to Smart AirBnB Regulation for Local Governments.
Retrieved 11 30, 2017, from http://www.viewpointcloud.com/blog/local-government-
resources/airbnb-regulation-guide/
Hartford, s. (2015, Sep 28). What Effect has Airbnb Regulation had in Santa Monica? Retrieved
11 30, 2017, from http://blog.airdna.co/effect-of-airbnb-regulation-to-santa-monica/