Platform upstarts rising at the expense of seemingly untouchable companies has been well documented - in the past twenty years we've seen Amazon upend retailers, Uber lay waste to taxis, and websites like Expedia all but completely eliminate the need for a travel agent. The lodging and hospitality industry is no exception. Ever since it's launch in 2008, Airbnb has upended the traditional operators - established brands like Marriott are jumping into homeshares to compete directly against Airbnb, Hilton is floating new hotel concepts to target millennial customers, and Intercontinental is pushing aggressively into the luxury segment to combat losses at the lower end of the spectrum. Ten years later, consumers in the US are now spending more on Airbnb than Hilton and Intercontinental.
New York is one of the world's top destinations for tourists and, subsequently, one of the fiercest battlegrounds between Airbnb and traditional operators - a recent study concluded that "total potential hotel revenue lost to Airbnb may have totaled $365 million in 2016 alone." With this in mind, I thought it might be interesting to dive a bit deeper into Airbnb's presence in this market using data from Kaggle.
Inventory Analysis - Investigate inventory levels at the macro (borough) and micro (neighborhood) levels. Discern which property types and boroughs are the biggest contributors to Airbnb's revenue in New York.
Host Segmentation - Conduct a review of hosts on the platform and break them into smaller, more digestible segments.
There is a ton of excellent writing - academic and otherwise - focused on the rise of platform business models. I'm personally a fan of the explainers produced by Applico, which defines linear businesses as those which "create value in the form of goods or services and then sell them to someone downstream in their supply chain" and platform business as those that "create value by facilitating exchanges between two or more interdependent groups, usually consumers and producers."
For hotel and hospitality companies that operate under a linear business model, concepts like market segmentation and inventory analysis are relatively straightforward in theory, framed along the lines of "who stay at hotels?" and "how many rooms do I have available for guests?" Of course this is an oversimplification, but at its core these concepts are fundamental in shaping the ways that hoteliers think about concept design, marketing campaigns, site acquisitions, pricing, - the list goes on and on. But for platforms like Airbnb, answering these questions is a bit more nuanced. No longer is it sufficient to have a grasp on who your guests are, you also need to be just as knowledgeable about the hosts active on your platform.