How AirBnB Became the Largest Hotel Chain

AirBnB Article Explaining It's Strategy

When Warren Buffet recommends a company, you know it’s reached the pinnacle of success. Warren Buffet suggested that shareholders attending a conference in Omaha use AirBnB as a less expensive hotel alternative. AirBnB didn’t obtain this level of endorsement overnight. Like all successful companies, it used excellent timing, product development and focus on becoming the phenomenon it is today.

Time the Market

When people think of AirBnB, they visualize accommodation. However, AirBnB itself is nothing more than a tech company, cleverly using software that translates into more than a million rooms across the globe.

In 2009, Brian Chesky, Joe Gebbia and Nathan Blecharczyk, the three founders of AirBnB, identified two trends. First, as the internet brought the reality of a global village ever closer, travelers were increasingly using it to research accommodation options and book rooms. Secondly, the recent recession resulted in many people leasing spaces in their homes as a way to supplement rent or mortgage payments. The three entrepreneurs successfully exploited these trends to bring together travelers and property owners who were already experimenting with this idea. Thus, AirBnB was born.

Timing was crucial to the success of AirBnB’s platform – several other companies had already tried this idea and failed. However, in 2009, current economic and social conditions meant that both travelers and property owners had a need, and AirBnB provided an aspirational, user-friendly platform for these groups to access each other.

Market an Experience, Not a Product

Brian Chesky claims that some of the best advice he was given was not to do things that scale. Famously, when AirBnB first started, they focused solely on the New York market, rather than trying to maximize business by expanding across the U.S..

Chesky believes that many entrepreneurs try to sell as much as possible, before perfecting their product. AirBnB, on the other hand, concentrated on optimizing the experience for those who booked their spaces in New York. Gradually, users began to recreate the same experience elsewhere. The sense of trust and design thinking that had been developed in the smaller market transitioned into the high-quality, global product we know today.

Many entrepreneurs tend to market their product, rather than the experience it can provide. By perfecting their product in a small arena, the AirBnB founders ensured that users gained an experience which would be promoted and replicated elsewhere.

Focus On Marketing Details

In 2009, AirBnB was earning a mere $200/week in revenue. The team tried to identify reasons why there was hardly any growth and came to a sudden realization – the photos on every listing in New York looked amateurish and uninviting. Instead of asking room owners to improve their images, the team traveled to New York and patiently set about the onerous task of taking professional photos of each available room and talking to owners so that listings more accurately reflected the product being offered. Growth was immediately evident.

This focus and willingness to look for solutions beyond software and marketing campaigns were the ultimate key to AirBnB’s success. Many entrepreneurs would consider visiting each site to be impractical. Yet, this level of dedication and singular focus was the turning point in the successful marketing of the AirBnB concept.

During AirBnB’s development, a new employee suggested using hearts rather than stars as part of the rating system, as it would better reflect the AirBnB experience. Subsequently, customer engagement increased by over 30% after this seemingly insignificant alteration was made. The AirBnB story teaches us to focus on small aspects of a product’s image as well as an overall marketing strategy.

AirBnB Lessons

Any start-up company can learn from AirBnB’s success. Time your market, perfect your product and care about the small stuff as much as the big picture.


You've come down this far for a reason.

Contact Sales//1-646-571-2054