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Published by: International Institute for Management Development (IMD)
Originally published in: 2018
Version: 11.12.2018
Revision date: 17-Apr-2019
Length: 6 pages
Data source: Published sources

Abstract

Hilton Inc is one of the biggest players in the hospitality industry. It has a market capitalization of USD20 billion which comes just after Marriott with a market capitalization of USD34 billion. Just in recent years, peer-to-peer economy has emerged and imposed a threat to Hilton. This economy is based on a decentralized model whereby individuals interact to buy or sell goods and services directly with each other, without intermediation by a third-party. Among the biggest players in the peer to peer(sharing) economy is Airbnb, that was founded in 2008 and showed unprecedented growth until 2017. As a privately held start-up, Airbnb is valued at USD30 billion, based on the company's latest round of funding, serving over 3 million listings in more than 65,000 cities in close to 200 countries. Airbnb CEO has made it clear that their plan is to become a full-blown hospitality brand, one that delivers a seamless end to end experience to its customers. Meanwhile Hilton Inc. is reacting to the threat posed by Airbnb through denial. The CEO claims that Airbnb is not a threat to their value proposition. The case analyzes in which segment (leisure or business) Airbnb and Hilton inc are winning or losing.

Time period

The events covered by this case took place in 2016-2017.

Geographical setting

Region:
World/global
Country:
United States

Featured companies

Hilton Worldwide
Employees:
10000+
Turnover:
USD 11.3 billion revenue;
Industry:
Hospitality industry
Airbnb

About

Abstract

Hilton Inc is one of the biggest players in the hospitality industry. It has a market capitalization of USD20 billion which comes just after Marriott with a market capitalization of USD34 billion. Just in recent years, peer-to-peer economy has emerged and imposed a threat to Hilton. This economy is based on a decentralized model whereby individuals interact to buy or sell goods and services directly with each other, without intermediation by a third-party. Among the biggest players in the peer to peer(sharing) economy is Airbnb, that was founded in 2008 and showed unprecedented growth until 2017. As a privately held start-up, Airbnb is valued at USD30 billion, based on the company's latest round of funding, serving over 3 million listings in more than 65,000 cities in close to 200 countries. Airbnb CEO has made it clear that their plan is to become a full-blown hospitality brand, one that delivers a seamless end to end experience to its customers. Meanwhile Hilton Inc. is reacting to the threat posed by Airbnb through denial. The CEO claims that Airbnb is not a threat to their value proposition. The case analyzes in which segment (leisure or business) Airbnb and Hilton inc are winning or losing.

Settings

Time period

The events covered by this case took place in 2016-2017.

Geographical setting

Region:
World/global
Country:
United States

Featured companies

Hilton Worldwide
Employees:
10000+
Turnover:
USD 11.3 billion revenue;
Industry:
Hospitality industry
Airbnb

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