Airbnb vs. Bookings.com

vs. PSB 2016: International Business Presentation

Group 6: Alessandra Willingsdorfer, Jiayue Sun, Kb Ishwarya, Kurt Wnendt

Trends and Factors affecting the Industry Travel and tourism continue to prosper globally, hitting a record 1.2 billion arrivals in 2015, up 4% Rise of millennials with budgeted travel money Millennials enjoy last minute bookings and adventure tourism Peer-to-peer accommodation like Airbnb and HomeAway is in demand. 35% of online travel bookings via mobile by 2018 22% of all holidays are city trips More travelling for ‘ Bleisure’ Staycations or travelling closer to home

PSB 2016: Alessandra Willingsdorfer, Jiayue Sun, Kb Ishwarya, Kurt Wnendt

PEST - Airbnb Political ● ● ●

Economical

Future legislation Conflicts between local housing laws Conflicts/ terror in certain areas

Sociocultural ● ● ● ●

● ● ● ●

Tax regulations on services Customer/end-user drivers Currency changes Hotels change in strategy and price

Technological

Lifestyle trends (increased/decreased demand) Consumer booking patterns Advertising, publicity, media (-/+) Ethical issues (irresponsible hosts/guests)

● ●

Innovation potential Data collection (access to information)


PEST - Booking.com Political ● ● ●

Economical

Conflicts in certain areas Religious intolerance Tax policy & regulation

Sociocultural ● ● ● ●

● ● ● ●

New tax regulations Change in labor cost Change in commission law Currency exchange rates

Technological

Change in accommodation preferences Cultural norms Demography Company image

● ●

Booking apps Competing technological development

●

Greater flexible booking-internet,teletext,call centres




Revenue: $200/week

2008 2009 PSB 2016: Alessandra Willingsdorfer, Jiayue Sun, Kb Ishwarya, Kurt Wnendt

2.3 million Airbnb listings 640,000 Hosts worldwide 100 million USERS Revenue of $900m in 2015

Airbnb’s total valuation $30 billion 3% cut of each booking

191 countries Total funding raised to date: $3.2 billion

> 113% revenue growth

6% - 12% service fee from guests

,

Source: http://expandedramblings.com/index.php/airbnb-statistics/ https://www.cbinsights.com/blog/airbnb-hospitality-industry-valuation-breakdown http://uk.businessinsider.com/airbnb-raises-850-million-at-30-billion-valuation-2016-8?r=US&IR=T/


Source: https://skift.com/2016/05/03/state-of-travel-2016-airbnb-vs-hotel-rivals-in-6-charts/




SWOT - Airbnb Strengths

Weaknesses

Opportunities

Threats

Well recognised business High growth rate

Opponents are fighting against the concept, laws requiring hosts to pay a hotel tax

New big, exploitable markets

Growing competitors clickandrent.com,..

Partnerships

Idea can be easily copied

Growing demand of travelers preferring alternative ways and who opt for Airbnb

An alternative concept may arise and replace apartment sharing

Reduced labor costs Lower prices compared to hotel prices

Airbnb relies heavily on hosts deliver and quality

Wide range of listings

Increasing number of unpleasant host experiences

No group/room discount High user number

Tax changes Increasing operational costs (employees)


Porter’s Five Forces - Airbnb Threat of new entrants: moderate

Bargaining power of customers: high

Bargaining power of suppliers: low

Threat of substitutes: high

Inter-firm rivalry: moderate



Online travel agents (OTA)


1997 2005

1998 2002


2000

over 1,000,000 properties globally

900,000 room nights reservations each day

Revenues of USD 2,555.90 million

4.8 million bookable rooms

300,000 vacation homes Net Earnings of USD 580.64 million

Source: http://www.capitalcube.com/blog/index.php/the-priceline-group-inc-pcln-us-earnings-analysis-q2-2016-by-the-numbers-august-5-2016/


SWOT - Booking.com Strengths

Weaknesses

Opportunities

Threats

Wide range of services and price class

Low entry barriers to new players

Changing structure in travel industry

Decline in economy

Declines or disruption in travel industry

Expand and maintain a strong market position

International expansion and globalisation offers opportunities

Popularity and user revenues

Partnerships and strategic alliances

Online platform

Online advertising

Intense competition could reduce market share Uncertain global conditions Competitive rates


Porter’s Five Forces - Booking.com Bargaining power of suppliers: high

Threat of new entrants:moderate/ high

Inter-firm rivalry:

Threat of substitutes: high

Bargaining power of customers: high


vs. Who has the competitive advantage? PSB 2016: Alessandra Willingsdorfer, Jiayue Sun, Kb Ishwarya, Kurt Wnendt






Future -The new concept of Airbnb -Customization and personalization: a shift from SOPs to personalized attention and guest experiences; -Uniqueness of the offer: budget hotels emphasizing unusual design and high-quality F&B offer; -Use of existing buildings: repurposed buildings, the original function of which becomes part of the experience; -Community building between guests and with locals; social innovation: F&B outlets or events aimed at visitors and residents; -Integration into local economies: connection with neighbourhood businesses and employment or trainings in less privileged areas.


Future -The concept of Booking.com


Airbnb vs. Bookings.com

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