Disruptive Innovation of AirBnB
Disruptive innovation is the technique in which the existing markets are disrupted and formation of new markets takes place. Because of this technique, the existing dominant groups and products are kicked out of the market.
The focus of this article is on the strategies adopted by a company named AirBnB which is a so called disruptor in the field of hospitality industry. AirBnB has its base in San Francisco and is founded in 2008. It provides hospitality and rental services in the online mode by acting as a broker between the hosts and renters.
AirBnB started focusing on the high value customers since 2018. Here, the renters can find accomodation on the basis of their budget and desired location. They were addressed as disruptors because the existing hotels were unable to compete with their innovative marketing techniques.
AirBnB attracted customers because of few reasons like , incorporating various modern internet technologies, addressing the customers saying they will provide cost effective accomodation. In the market created by them hosts can use AirBnB's technological infrastructure.
It was providing advantages to both renters as well as hosts. For the former the cost was less compared to hotels, they can get houses, flats or rooms of their desired price range in their desired location. For the later , they could set the prices of accommodation either by using AirBnB price calculator or by using AirBnB pricing strategy in which few other accomodations at the place of interest is compared to set the price. Also they could alter the prices according to the seasonal variations.
Few innovative ideas introduced by them are, they changed the average pictures of accommodations given by respective hosts to more beautiful ones by capturing images themselves. And they assured high safety for their customers , they even paid compensations if safety issues were raised.
The hotels were unable to compete with them due to these innovative ideas, even their survival became very difficult. Also the hotels needed follow complex laws and regulations whereas for AirBnB these were not so complex. This made various hotels to even withdraw from the market, making them a innovative disruptor to the market.
