Marketing Management: Airbnb Demand System and Problem Analysis

This report provides a comprehensive analysis of Airbnb's marketing strategies, focusing on its demand system, identified marketing problems, and proposed solutions. The report begins by constructing a demand system map to visualize the various components and stakeholders involved in Airbnb's operations, including customers, suppliers, and other key players. The core of the report identifies and examines Airbnb's marketing challenges, such as the complexities arising from operating in diverse global markets and the difficulties in ensuring user compliance with relevant housing, safety, and zoning regulations. The report also critiques Airbnb's content marketing strategies, emphasizing the need for a stronger focus on user-generated content to enhance brand awareness and community engagement. Furthermore, the report delves into the root causes of these marketing issues, including the impact of lengthy terms of service, lack of control over hosts and guests, and deficiencies in customer service. To address these problems, the report suggests several solutions, including refining the Host Protection Program, improving user verification processes, developing a robust content marketing strategy centered around user stories, and streamlining the terms of service. The report concludes by emphasizing the importance of these improvements for enhancing Airbnb's brand image, revenue generation, and competitive advantage.

Running head: MARKETING MANAGEMENT
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Name of the Student
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Author Note

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Airbnb DemandDemandSuppliers Customers
Restaurants
Event organizers
Accommodation
Hosting
Travel guide
Rental management
Insurance
Low cost
Rental practice
Personalized search option
Luxury services
Quality service
Travel tips
Product diversificationHospitality standards
Promotional tools
Q1. Draw a demand system map for Airbnb
Figure 1: Demand System Map for Airbnb
(Created by the Author)
Q2. What is Airbnb’s marketing problem?
Airbnb is an online marketplace and hospitality service brokerage company from
America, based in San Francisco, California, United States. It operates in hundreds of
countries, and they have to deal with a diverse around the world. Hence, it makes difficult for
the organization to inform the users regarding all the applicable housing, public safety and
zoning laws which might be applied to them either as hosts or guests. The flaw in their
marketing system is to place all kinds of legal requirements on the users through the terms of
service agreements between the organization and the users. Instead of educating all the users
of the appropriate housing and safety laws which is applicable to them according to their
respective territories (Reinhold and Dolnicar 2018).

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The content marketing is also another problem for Airbnb, as they are missing to
focus on the right kind of content marketing. The main aim or objective of the organization is
to become one of the largest community-driven super brands in the world. But it will be
difficult for them to accomplish this aim, as it is very important to have a presence in the
content marketing. If Airbnb are able to grab the stories from both the hosts and guests end
about the experiences of using the Airbnb properties, it will help to lead to a higher brand
awareness for the organization as well as possessing stronger relationships with the
communities of the organization, higher rate of positive media attention, which will help the
company to attract more people as both hosts and guests (Oskam and Boswijk 2016).
Q3. What is causing the problem?
One of the reasons for causing the problem is the lengthy terms of services, which is
over 16,000 words in length, which was updated after two ways of the occurrence of the
incident with Jacob Lopez. It is almost impossible to read these 16,000 words for the users
before signing the agreements and they firmly believe on the organization of Airbnb
regarding these terms and conditions. Less or no control over the hosts, guests, or any other
user of the site from the organization’s end are creating the miscommunication between the
organization and the other people are creating a bad impression on the brand image on
Airbnb (Guttentag 2015).
Absence of the user-generated content in content marketing is hampering the revenue
generation for the company. It helps to attract more people as hosts and guests, so that more
people will get involved in the online platform of the organization, which will result in the
revenue generation for the company as well as to increase the brand awareness. The customer
service is also hampering the brand image of the organization, as it has been in the case study
that Micaela Giles, mother of Jacob Lopez, was harassed when she tried to call the customer

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service of the organization from the United States of America, when his son was sexually
harassed in Madrid, Spain. These cases will hamper the brand image of the organization as
well as decrease the level of revenue generation for the company, and will reduce the chances
to gain a competitive edge over its competitors (Gutierrez et al 2016).
Q4. How will you fix the problem?
Airbnb has started to offer a Host Protection Program or Host Guarantee, through
which the hosts would be covered a sum up to $1 million in case of any damages or injuries.
But there are terms and conditions in this program. Airbnb stated that the insurance would be
a secondary one, that means the hosts would be benefitted from that program only after their
personal insurance coverage would get exhausted. Moreover, ot wold not cover any kind of
pets, cash and securities, personal liability or any common areas. Verification process should
be more particular where the guests will know more about the hosts who will accommodate
their properties for the guests to stay, and this have to authentic (Chen and Xie 2017).
Airbnb have to make a presence in the content marketing. They have to engage
themselves in the creation as well as sharing the inline materials like blogs, videos and social
media posts, which will specifically not promote the brand name of the company, but will
help to simulate the interest in the services provided by the company. The strategy should
focus the user generated content in place of normal strategy. It has been found that the
companies often use their blog in order to share the case studies, updates about the product or
the service, updates about the company, press releases and others. They do as there is no
other places to share all these things. But these are not interesting stuffs which can attract
people to avail the services of Airbnb. So, to make it interesting, the organization should use
the content to frame the brand as well as the community, in order to attract the eyeballs of the
new people and to become their customers and also to strengthen the relationships amongst

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the retained or existing customers. If the company is able to handle the content marketing
properly, it will help the organization to possess a higher brand awareness as well as help to
earn higher revenue.
The main thing needed will be proper content strategy. They should focus on the
personal stories from the user-base of the organization. Also they can use those user-
generated personal stories to attract new hosts who will rent their properties to the guests, as
well as sing the user-generated city and country guides as well as travel reviews. The terms of
service between the company and the hosts need to shortened and crisp so that every new
hosts are able to read them thoroughly and can clarify the issues before any complications
arises after the agreement between the company and the hosts. Proper profile details need to
be provided on the portal so that the guests can get the thorough details of the hosts and
accordingly can book their places. Guests can also ask the hosts to complete the profile
verifications before booking their places. On the other hand, hosts also can request to
complete to fill up their profiles so that updated information will be available to the hosts
related to the guests (Biber et al 2017).

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References
Biber, E., Light, S.E., Ruhl, J.B. and Salzman, J., 2017. Regulating business innovation as
policy disruption: from the Model T to Airbnb. Vand. L. Rev., 70, p.1561.
Chen, Y. and Xie, K., 2017. Consumer valuation of Airbnb listings: a hedonic pricing
approach. International journal of contemporary hospitality management, 29(9), pp.2405-
2424.
Gibbs, C., Guttentag, D., Gretzel, U., Yao, L. and Morton, J., 2018. Use of dynamic pricing
strategies by Airbnb hosts. International Journal of Contemporary Hospitality
Management, 30(1), pp.2-20.
Gutierrez, J., Garcia-Palomares, J.C., Romanillos, G. and Salas-Olmedo, M.H., 2016. Airbnb
in tourist cities: comparing spatial patterns of hotels and peer-to-peer accommodation. arXiv
preprint arXiv:1606.07138.
Guttentag, D., 2015. Airbnb: disruptive innovation and the rise of an informal tourism
accommodation sector. Current issues in Tourism, 18(12), pp.1192-1217.
Guttentag, D., Smith, S., Potwarka, L. and Havitz, M., 2018. Why tourists choose Airbnb: A
motivation-based segmentation study. Journal of Travel Research, 57(3), pp.342-359.
Oskam, J. and Boswijk, A., 2016. Airbnb: the future of networked hospitality
businesses. Journal of Tourism Futures, 2(1), pp.22-42.
Reinhold, S. and Dolnicar, S., 2018. How Airbnb creates value. Peer-to-Peer
Accommodation Networks: Pushing the Boundaries, pp.39-53.

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Appendix
Figure 1: Demand System Map for Airbnb