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Case
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Reference no. 319-0272-1
Published by: Amity Research Centers
Originally published in: 2019
Revision date: 9-Oct-2019

Abstract

On June 25th 2019, Airbnb launched 'Airbnb Luxe', a new luxury rental tier. Properties listed under Airbnb's Luxe included some of the costliest and most luxurious accommodations available on Earth. It was intended for those customers who were willing to spend over USD1,000 per night on carefully designed, huge private homes with picturesque views and world-class amenities. According to Airbnb, the tariff of the homes could be as low as USD1,000 per night and could go up to USD200,000 per night. The launch of Airbnb Luxe facilitated the company to cater to the rise in demand from the company's guests for luxury properties and experiences. This new tier comprised more than 2,000 handpicked homes worldwide, each one passing strict evaluation across 300-plus criteria to meet standards in terms of both design and function. Moreover, bookings made under Airbnb Luxe offered round-the-clock access to a dedicated, well-trained trip designer whose responsibility was to make sure that the customers' stay was customised as per their unique requirements. However, despite its popularity, Airbnb was likely to face stiff competition from its rivals in the market. Some of the immediate rivals included HomeAway, Oliver's Travels, Four Seasons Hotels and Resorts, and Mariott International. Given this scenario, would it be possible for Airbnb to attract customers belonging to different market segments and enjoy a superior position in the online home rental marketplace? What were the issues and challenges likely to be faced by Airbnb in this 'Luxe' drive?

Teaching and learning

This item is suitable for undergraduate, postgraduate and executive education courses.

Time period

The events covered by this case took place in 2019.

Geographical setting

Region:
World/global

Featured company

Airbnb, Inc
Employees:
10000+
Type:
Self-owned
Industry:
Lodging

About

Abstract

On June 25th 2019, Airbnb launched 'Airbnb Luxe', a new luxury rental tier. Properties listed under Airbnb's Luxe included some of the costliest and most luxurious accommodations available on Earth. It was intended for those customers who were willing to spend over USD1,000 per night on carefully designed, huge private homes with picturesque views and world-class amenities. According to Airbnb, the tariff of the homes could be as low as USD1,000 per night and could go up to USD200,000 per night. The launch of Airbnb Luxe facilitated the company to cater to the rise in demand from the company's guests for luxury properties and experiences. This new tier comprised more than 2,000 handpicked homes worldwide, each one passing strict evaluation across 300-plus criteria to meet standards in terms of both design and function. Moreover, bookings made under Airbnb Luxe offered round-the-clock access to a dedicated, well-trained trip designer whose responsibility was to make sure that the customers' stay was customised as per their unique requirements. However, despite its popularity, Airbnb was likely to face stiff competition from its rivals in the market. Some of the immediate rivals included HomeAway, Oliver's Travels, Four Seasons Hotels and Resorts, and Mariott International. Given this scenario, would it be possible for Airbnb to attract customers belonging to different market segments and enjoy a superior position in the online home rental marketplace? What were the issues and challenges likely to be faced by Airbnb in this 'Luxe' drive?

Teaching and learning

This item is suitable for undergraduate, postgraduate and executive education courses.

Settings

Time period

The events covered by this case took place in 2019.

Geographical setting

Region:
World/global

Featured company

Airbnb, Inc
Employees:
10000+
Type:
Self-owned
Industry:
Lodging

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