Business Strategy Analysis for Airbnb and Rosen Hotel

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National University of Ireland, Dublin

Bachelor of Business Studies (management)

Intake 29

Group: B

Module: Business strategy

Essay Title: Business strategy analysis for Airbnb and Rosen hotel

Submitted by: Li Weijie

Student Number: 16213612

Lecturer: Cubie Lau & Shawn Wang

Submission Date: 02/04/2019

Word Count:1200

1.0: Introduction

Nowadays with the time advance and technology development, a lot of industry has been changed, new enterprise mode rises and traditional business mode decline. In such big environment, the hospitality industry is also not immune. Thus, this report will analysis three case of hospitality industry and understand the core value of their business strategy when the environment is change frequently.

2.0: Case study from Airbnb and Rosen hotel & resorts

2.1: Case study of Airbnb

Airbnb is an online rental platform which establish at 2008 at American, but because the unique service provides on platform make Airbnb growth very fast in the past 10 year and now the Airbnb are already rank second place at global hospitality industry.

However, does Airbnb really same like other traditional hospitality industry? Actually not, on the business mode aspect, Airbnb can be calling as a peer-peer mode, which is selling product from one person in the market to another person in the market, company as a business entity only exist to provide platform and supervise the legitimate of every trade. Airbnb’s business mode is establishing a platform for two kind of people each is the person who have empty house and willing to make it profitable and a person who have wiling to travel aboard and willing to more experience local culture. This kind of the operation mode make Airbnb been address “The eBay of hospitality industry”.

But there is still somebody who are questioning, does the Airbnb really should include in hospitality industry? The reason for those kinds of question is because the Airbnb operation mode is far different from the traditional hospitality industry. Those people think that traditional hotel is to provide accommodation and services for foreign tourists directly, all the business transaction is down face to face, the customer only pay when the service is down. In such business model, the hotel itself can represents the landlord while the passenger is more like tenant in some extent (Gerdeman, 2014). But Airbnb does not have any business entity to provide services directly to the passenger, nor does Airbnb have any business entity to charge the passenger directly for profits. Airbnb only earns handling fees and monitors the legitimacy of transactions in the course of this transaction to ensure that landlords and passengers do not suffer losses. Thus, it can be saying the Airbnb is more like a short-term house rental platform rather than a hospitality industry company.

Although this kind of question still exist in market, but the changing environment are bringing more and more chance to Airbnb operation mode and provide that Airbnb mode is a new way of hospitality.

Nowadays people are not emphasizing owning something but emphasizing experience and sharing. With the increasing demand for experience, the traditional hotel industry has been affected to some extent. The traditional hotel industry is selling customers the ownership of a room at a higher price, which is a business form current in the downturn, customers now seek to enjoy and experience an unknown culture through lower prices. Instead of caring about the ownership of a room, they want to experience the unique local culture by sharing the house with others. Airbnb facilitates the sharing of this experience through the Internet, giving people the opportunity to rent their own house to foreign tourists or to rent houses with friends to get more cultural experience.

In addition, Airbnb uses a review system to enhance customer experience and communication. This strategy enables more travelers to share their stories in different countries at different houses. Those sharing stories also effectively attract more people interested in a particular country and travel to those countries. But because the traditional hotel industry are not able to provide customers with an opportunity to experience the local culture, and with the improvement of business standardization, the hotel services experienced in different countries are now tend to same. Therefore, in the current market which emphasizes experience and sharing, only Airbnb provides unique services and experiences which catering to the market more efficient and more effective and lead Airbnb perform beyond many traditional hotel industries.

3.0: Case study to Rosen hotel and resorts

Airbnb show people that follow the trend of market will lead a powerful growth of the company, but another example of Rosen Hotel and resort (Rosen Hotel) a hotel which smooth operation for over 40 years will show the importance of corporate social responsibility.

Corporate social responsibility is emphasized company shall responsible to any stakeholder who involve with operation. Rosen Hotel is down a very good job on responsible to employees, customer and society.

First for Rosen hotel human resource management. They are providing comfortable working environment and reasonable welfare for employees. According to Rosen Hotel human resources manager, this hotel will become the backup of employees to help employees over through any difficulty. It's this kind of intimate working environment that inspires employees ‘enthusiasm for work, and their services also bring many loyal customers to the hotel. Some customers even visit the hotel for more than 30 years, which is very difficult for a hotel industry. The second impressive point is the hotel's attitude toward society. Rosen hotel profits are not only used for employee welfare, but also for community welfare. Rosen Hotels has been supporting children from poor communities to go to school and providing all the tuition fees for those who are able to go to college to help them become more useful people in future. Such social services have also helped Rosen Hotel gain a steady stream of potential employees.