In 2009, Airbnb, a fledgling start-up, barely generated $200 per week, a revenue stream insufficient for long-term sustainability. During this critical period, Joe Gebbia, one of the co-founders, identified a crucial issue— poor-quality images of the listings, making it challenging for potential customers to evaluate their options.
Recognizing the impact of visual appeal on customer decision-making, Paul Graham, another co-founder, embarked on a trip to New York. He rented a professional camera, visited several properties, and replaced the low-quality images with high-resolution photos. This seemingly simple intervention led to doubling their weekly revenue to $400.
As a Rhode Island School of Design graduate, Gebbia was familiar with design thinking principles. He decided to apply this approach to their business, focusing on understanding and addressing the needs of their customers. Although unconventional, this innovative and customer-centric strategy fostered a culture of comprehensive thinking within the company. It also shifted the company’s core focus to design and user experience.
Applying design thinking principles transformed Airbnb from a struggling start-up to a global powerhouse, generating $8.399 billion in annual revenue and operating in nearly 192 countries.
Table of Contents
- Key Factors of Airbnb’s Massive Success
- Frequently Asked Questions
Key Factors of Airbnb’s Massive Success
Airbnb is a significant contributor to the “platform revolution”, a trend characterized by rapidly expanding tech companies that thrive on meticulously managing high-value user interactions. The company attributes its success to a user-centric approach to design and innovation, emphasizing design as a core company value. Co-founder Joe Gebbia cites their strategy to overcome the ‘stranger equals danger’ bias as a key factor in Airbnb’s massive success.
The company has successfully identified and addressed a significant obstacle many companies face in the sharing economy: the absence of trust. They’ve dissected this barrier into its core elements and strategically designed their platform to overcome it.
A Holistic Experience Approach
Brian Chesky, co-founder of Airbnb, emphasizes a customer-focused, holistic approach to product development. This strategy has enabled Airbnb to expand its product offerings beyond just its website or app, instead focusing on delivering unique, memorable experiences. Chesky stated, “Our customers are not just interacting with our website or app, which are simply communication tools. They are investing in a home and, more importantly, a hospitable experience and a sense of belonging.”
This philosophy of crafting experiences is what distinguishes Airbnb. Their comprehensive product design is committed to offering customers a unique, unforgettable experience that engenders a sense of connection to the location. They believe a product’s value extends beyond its lifecycle, leading to a moment of profound realization or insight for the customer.
Design To Build Trust
A significant challenge Airbnb confronted was the inherent bias against strangers, particularly evident in the context of the sharing economy. Before Airbnb, the concept of sharing personal spaces like homes with strangers was largely alien and unaccepted. The idea of creating a platform where users would willingly share images of their private spaces, including bedrooms and bathrooms, to facilitate rentals appeared unfeasible. The general perception was that strangers posed a risk, and this was a significant deterrent for potential investors. However, co-founder Joe Gebbia believed that a well-executed design could foster trust and mitigate the ‘stranger-danger’ bias. He once stated:
“In art school, we learned that design extends beyond aesthetics to encapsulate the entire experience. We had been taught to apply this to objects, but our goal was to create a platform that would engender trust between individuals who had never met.” — Joe Gebbia.
A study conducted by Stanford Research on social biases and reputations supports this notion. The study found that high reputation often trumps similarity and can be instrumental in overcoming deeply ingrained biases. The research concluded that a well-structured reputation system is crucial for building trust. Additionally, the right level of disclosure also plays a significant role. The study found that host acceptance rates increased when the message length was directly related to the host’s apartment. Consequently, Airbnb designed a form suggesting the appropriate message length and crucial information to be included, thereby intuitively fostering connections and increasing host acceptance rates.
How To Establish Trust Through Design
Trust is established when the right amount of information is shared during interactions. Sharing too little can lead to mistrust, while excessive disclosure can be overwhelming.
Striking a balance in information sharing is key to building trust and increasing the likelihood of a booking acceptance. The question then arises: how do you devise a system for optimal disclosure? Airbnb accomplishes this through two methods:
- Text Box Size: The size of the text box provides a hint about the expected length of the message. It encourages more than a single sentence, simultaneously indicating that it’s not a space for extensive writing.
- Prompts: Airbnb doesn’t leave users to figure out what to write. They utilize data to understand what successful messages contain and then guide new users to include this information via bullet points.
The Eleven-Star Framework
In a dialogue with Reid Hoffman, Brian Chesky expounded on the concept of the eleven-star framework:
“On the internet, especially most marketplace businesses, the paradigm is five stars. So a YouTube video, Airbnb, or Uber, it’s five stars. And the problem with five stars is the only reason you would leave less than five stars is that it was horrible. If you rate an Uber ride four stars, your life might have been in danger. In other words, the bar to get five stars is really low.”
“We have to almost design extremely to come backward” — Brian Chesky
Chesky argues that a five-star rating is insufficient. His goal is to create a product so impactful that customers feel compelled to share their experiences and request the ability to give a rating beyond the conventional five stars. He aims to exceed customer expectations at every opportunity, a principle that permeates all aspects of Airbnb’s operations.
The Fusion of Culture and Design
Peter Thiel, PayPal’s co-founder and renowned venture capitalist, provided a ground-breaking piece of advice to Brian Chesky: “Don’t Fuck Up The Culture”. Chesky penned an article on medium.com with the same title, where he interprets culture as a shared way of doing things.
“People need to be in a mindset of your product. And so you have to put your product in the building. People need to be immersed in the world because they’re working in that world. It’s like working in the center of the universe. The center of the universe of your business needs to be most potent.”
An insightful perspective from Chesky highlights the reciprocal relationship between culture and design. This concept is evident in Airbnb, where the company’s culture is manifested in its design, and in turn, the design reinforces the culture.
Chesky believes in the potential for design and reinvention in all aspects, including the workspace. This belief led to the unique redesign of the company’s office, where meeting rooms were recreated to mirror the apartments of Airbnb users. This innovative approach created an engaging workspace and served as a testament to the company’s commitment to its culture and values.
Importance of Culture to Design
The strength of a company’s culture can significantly impact its competitive advantage, influencing aspects such as recruitment and overall performance. At Airbnb, a strong culture is cultivated through shared values and a collective passion for the company’s mission. Chesky emphasizes repetition as a key factor in reinforcing these values, ensuring they remain constant despite technological advancements.
For instance, the company’s key cards bear the phrase “Champion the Mission”, serving as a daily reminder of the company’s core values. Chesky states these subtle touchpoints are instrumental in designing a robust culture.
Therefore, a strong culture facilitates accountability within the community, not through hierarchy but through shared focus and mission. By establishing a strong culture, a company can align its members towards a common goal, ensuring harmony and unity in its mission.
Attention to Detail
In the early stages of Airbnb, co-founders Joe and Brian noticed that many hosts were using low-quality images for their listings. To rectify this, they personally visited the hosts and took professional-grade photographs of the rooms. This hands-on experience emphasized that not all customer problems can be solved with code alone. Although technology is a potent tool, it cannot address every issue. Directly engaging with customers in their environment often leads to the most effective and innovative solutions.
There are also other key elements that make Airbnb’s user experience effective. These are:
Airbnb has consistently prioritized user experience (UX) and design, leading to significant improvements over time. A key development was the comprehensive revamp of their mobile application in 2016, which was designed to enhance intuitiveness and user-friendliness. The application now offers personalized recommendations and a more streamlined booking process, enhancing the user’s ease of navigation.
Airbnb’s design approach sets it apart from traditional hospitality providers by employing storytelling to foster an emotional connection between guests and hosts. Each listing on the platform includes a detailed description and photographs, providing a unique narrative about the host and their property. This strategy has effectively differentiated Airbnb, appealing to users seeking a more customized and intimate experience.
User-friendly Search and Features
Airbnb’s user interface is designed for ease of use, offering a variety of filters to streamline your search process. These include price, location, amenities, and unique categories such as special homes and experiences.
An interactive map feature allows users to browse listings by location and focus on specific neighborhoods. This tool aids in the discovery of appealing accommodations in areas they might not have initially considered.
The search results page presents a well-structured overview of each listing, including photographs, pricing, reviews, and key information. This allows users to swiftly identify listings of interest for further exploration.
The platform is engineered for user convenience, integrating search, booking, and host communication functionalities. Features such as Instant Book enhance the user experience by enabling immediate booking confirmation without the need for host approval.
Experience Section for Adventure and Community
Airbnb acknowledges the multifaceted nature of travel, emphasizing not only the exploration of new locales but also the importance of interpersonal connections and cultural immersion.
The platform’s “Experiences” feature provides users with the opportunity to engage in locally-led activities, which may range from culinary tours and artisanal workshops to guided excursions.
This feature serves a dual purpose: it enhances the authenticity of the traveler’s experience and promotes a sense of community within the platform as hosts and guests exchange knowledge and experiences.
Airbnb places a high value on transparency in all its operations. The company encourages both hosts and guests to provide reviews of their experiences, fostering a sense of trust and reliability within the platform.
The “Instant Book” feature is another testament to Airbnb’s commitment to transparency. This feature allows guests to secure a property without awaiting host approval, streamlining the booking process and minimizing potential miscommunications.
Moreover, Airbnb’s pricing model is designed with transparency in mind. The total cost of a booking, inclusive of all fees and taxes, is displayed upfront. This eliminates the possibility of hidden charges and fosters a sense of trust among users.
Airbnb’s user verification system is integral to its user experience. It allows both hosts and guests to confirm their identities using official identification documents. This procedure is instrumental in fostering a secure environment on the platform by confirming the authenticity of its users.
Airbnb’s extraordinary growth and success can be attributed to its user-centric design strategy and its commitment to delivering both functional and emotionally impactful experiences. Investments in innovative features, continuous improvement of platform quality, and personalized user experiences have distinguished Airbnb from its competitors.
For professionals seeking to improve their platforms, Airbnb’s approach to UX and design offers valuable insights and lessons. We recommend watching Joe Gebbia’s How Airbnb designs for trust on TED talks. Visit passionate for more tips on web design, app design, branding, and more.
Frequently Asked Questions
How did Airbnb’s design approach contribute to its success as a company?
Airbnb’s massive success is largely attributed to its strategic emphasis on design thinking and user experience. By prioritizing the needs and preferences of its users, Airbnb cultivated a culture of broad-based thinking. This shift in focus towards design and user experience became a significant driver of the company’s innovation and success.
Who was responsible for the original design of the Airbnb website, and what did it look like?
Joe Gebbia, one of the co-founders of Airbnb, was responsible for the original design of the Airbnb website. As a graduate of the Rhode Island School of Design, Gebbia applied his design thinking principles to the creation of the website. The initial website design was quite simple and straightforward. It featured a clean, user-friendly interface with a basic search function and listing details. The design was focused on functionality and ease of use. This allows users to quickly browse through available listings and book accommodations. The original Airbnb website had a much more minimalistic design compared to the current version, but it laid the foundation for the innovative, user-centric platform that Airbnb is today.
How does Airbnb determine the most effective design to implement, and what methods do they use to gather this information?
Airbnb leverages a variety of methods to identify the best design implementations. This includes user feedback, data analysis, and A/B testing to understand what works best for their platform. They continually collect and analyze this information to make informed decisions about design changes and improvements. The frequency of this data collection and analysis is ongoing, allowing Airbnb to stay responsive to user needs and market trends.