Airbnb Case Study

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“Trust is a valuable asset”: Incidents like the EJ episode definitely affected one of the most valuable assets of Airbnb: trust between hosts and users. We propose a few actions that we believe would increase trust between Airbnb’s hosts and users.

“Trust, but verify”[5]: Our recommendations are focused on improving the reliability of the system used for checking both renters’ and users’ backgrounds through the implementation of a the following tools:

- “Intelligent searching, reasoning and combining – Airbnb 3.0”: After having surfed the wave of the web2.0, Airbnb could step into the future and embrace the era of web3.0 by creating a control system that uses the information shared by other apps and social media (E.g. Facebook could report users sharing violent content or who are disrespectful to Airbnb; Uber could report users that trashed cars to Airbnb, etc.). Although this solution could be hard to implement we believe it is a future that is not far away. This intelligent monitoring system could therefore provide relevant data that will help better understand the personality of both renters and hosts, hence providing important tools to build stronger bonds of trust.

- “Leverage Big Data”: As a compliment to the above, Airbnb could also implement algorithms through analytics and data in order to provide a more complete profile of each person, hence identifying risky customers. For example, by taking into account sudden behavior changes in one’s behavior, Airbnb could use such information to generate special follow-ups and notifications in order to avoid incidents.

- “Increase security with better supervision”: Airbnb should also focus on enhancing its supervision tools by creating a set of certified inspectors qualified to make regular inspections to hosts’ properties. The results of the inspections should show along with hosts information (E.g. this house has recently been evaluated and was given a high level of satisfaction on criteria such as safety and cleaning). Airbnb could also include security deposits as an instrument to deter individuals with bad intentions from joining the site.

“There is always a flipside”: These alternatives would certainly require high amounts of investment and therefore could affect Airbnb’s business model. In addition, generating complicated enrollment processes could deter potential clients from joining the platform. This could form a negative opinion on how people perceive Airbnb and how they trust it. Furthermore, these kind of tools may also raise very sensitive issues regarding personal data protection and the discrimination of certain users.

Other sources of information:

- http://www.greattransition.org/publication/debating-the-sharing-economy

- https://www.pwc.com/us/en/technology/publications/assets/pwc-consumer-intelligence-series-the-sharing-economy.pdf

- http://cepr.net/publications/briefings/testimony/the-opportunities-and-risks-of-the-sharing-economy

- http://www.nytimes.com/2014/09/22/technology/sharing-economy-faces-patchwork-of-guidelines-in-european-countries.html?_r=0

- http://techcrunch.com/2011/07/27/on-safety-a-word-from-airbnb/

- http://edition.cnn.com/2011/TRAVEL/08/01/online.rental.horror.stories/

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