Airbnb’s Achilles’ Heel

April 9, 2013

As you probably know if you read this blog and follow me on Twitter, I’ve been thinking about local commerce, local search and discovery for the last 13 years. That means thinking how to create a better match between consumers and local businesses.

I’ve been following with high interest the rise of vertical peer-to-peer marketplaces like Airbnb and I finally had the chance to try the service a few weeks ago when we reserved a Florida house for a family vacation. As you probably all know, Airbnb offers homeowners the opportunity to rent their home or a room to tourists. You can build a very detailed profile and the site relies on strong identity checks and reviews to build up trust. After doing a lot of research, we finally settled on a house that seemed adequate for our family and it had 16 glowing reviews from strangers. Owner was extremely friendly in all his communications and we were looking forward to a well-deserved vacation.

When we arrived, the house was a little more rundown than expected (be aware that “rustic” has an interesting meaning in real estate) but nothing that we haven’t seen before, as we travel a lot in North America and Europe, and we’ve seen a wide variation of accomodation quality. I’ll skip the next two days for the sake of brevity but sadly, we had to take the decision to leave the house earlier than planned. We found too many ants and saw three roaches-like bugs over a 48-hours period in the house. The solution would have been to spray the house with repellent but we feared that this could be harmful to our toddler. I realize that Florida sometimes brings its lot of “domestic” insects but for the price we were paying, we felt it wasn’t worth it. This house wasn’t for us. We thought of complaining to Airbnb but, according to their policies, they require photos and we didn’t take any (it’s not the first thing you think about when you’re in a hurry to leave a place!) We lost our money and rented a hotel room for the rest of our stay. All in all, a very disappointing experience.

My local search mind started thinking feverishly (or maybe it was the hot Florida weather?): given that it’s probably a recurring problem in that house, why is it that, in 16 reviews, nobody mentioned ants and roaches?

Were they fake reviews? No, I don’t think so.

Were people ok with bugs? Maybe that’s a possibility, although I highly doubt everyone is fine with bugs (you just need to Google for the word cockroach in TripAdvisor)

And that’s when it hit me.  In Airbnb, you deal with individuals, not faceless corporations.  Tenants might be more hesitant to leave a negative comment about a fellow human being. There is a reason social media experts have been saying to corporations they need to have a human face and voice. It keeps the conversation more cordial. In addition, tenants and owners can review/rate each other, which means a negative rating from an owner can prevent you from possibly renting a house ever again on Airbnb.

Turning to eBay, the grand-daddy of marketplaces, I also realized that reviews from strangers in a peer-to-peer marketplace eventually become meaningless. You can read many complaints about that on the web. In a review site, what’s often missing is a like-mindedness filter, to let you know if people have the same taste as you. Yelp has that same problem.

I also realized that Airbnb is going after a vertical (hotels) that is more complex emotionally than many local purchases:

  • Vacation = positive moment in life. You mess up my vacation, I’m mad.
  • Dollar amount is bigger. I make a bad choice, I’m mad.

In addition, the hotel ecosystem comes with basic standard:

  • You know brands stand for something, a level of quality. Sheraton, Hilton, Best Western.
  • There is also a standard 5-star system, where in effect you can opt-in to lower quality (and lower prices) with full knowledge.

It also got me thinking about trust and social media. Ken Larson on Quora says:

“We really do not know who to really trust. To an extraordinary degree the age in which we live is requiring us to redefine trust and the degree to which communication and expectation contribute to it. Consider simpler times a few years past (say 50). Trust was necessary in many venues as a means of survival on a day to day basis. We relied on others extensively for our well being from our local store to our banker, from the policeman to the politician. And we knew them all better, we could reach out and touch them and we were not viewing them in sound bites and web sites, nor were we being bombarded with multiple forms of input to digest about them.”

Through all these reflections, I came up with an equation for trust. To have trust in an ecosystem, you need:

  • A strong brand (can be an umbrella brand or an individual brand)
  • Real identities (everyone uses real names and pictures)
  • Detailed Descriptions
  • Solid knowledge about local prices (being able to compare prices for same level of quality)
  • Reviews/recommendations
  • Social graph (friends or friends of friends have bought the product/service)
  • Detailed enforced standards via a certification program

Looking at this list, Airbnb is executing perfectly on almost all criteria except for one: standards. Airbnb has “host obligations” but I don’t think anyone is really enforcing those. Did you know BestWestern has a 30-page standards book you need to respect if you want to be a franchisee? Without solid standards and a certification program, I won’t be going back to Airbnb. They currently have a great brand, but they’re putting that brand at risk every day.

Update 1: less than 30 minutes after I posted this online, I was contacted by Airbnb to discuss my case.

Update 2: because we did not follow the “procedure” (contact the owner and/or Airbnb to try to solve the issue AND capture proof of our allegations), Airbnb could only offer us a $100 credit. Given that we lost about $600 and that we’re probably not going to use Airbnb again, that obviously wasn’t satisfactory.

 

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6 Responses to “Airbnb’s Achilles’ Heel”

  1. Zubair Talib Says:

    Good post Seb. I think this is an opportunity local sites (even perhaps the old school yellowpages) have missed. Verizon has made a narrow attempt with superguarantee – but the point is that there is a role for a broader, trusted agent to provide standards (as you say) and helpful recommendations and editorials to guide users and help cut through the noise – even if that noise is user generated.


  2. Hey Seb, I like your thought process and the trust equation you came up with. I hope Airbnb doesn’t just contact you to address your bad experience, but that they actually take your insights into consideration. They’d have a lot to gain from them. Cheers.

  3. nic Says:

    Hi Seb,

    I have been doing business through airbnb for almost a year now renting an appartment and also used it once for travelling. It sucks that you had a bad experience, however I can say that they do enforce the host guarantees. I am sure if you had taken pictures you would have been surprised on the outcome. I had one bad experience with a tennant that spilt wine all over my bed, and had no issues getting airbnb to reimburse me for new sheets and a duvet.

    I had done extensive searches when i rented and did notice that some hosts do have negative feedback, and the great thing is they can’t delete them. By the sounds of the reviews you read before renting the place, it is a first for the bugs. It may also be that the previous travellers may not have had as high standards for what they were looking for. It definetly is a great site, but as you say it is run by individuals, so you will always have some that offer up good apartments, and will have some that just lack respect and just want to make a buck!

    Anyways I am sure you already reviewed that host, so the next guests won’t have the same experience.

    Nic


  4. good perspective, i have pointed it to some of the folks at AirBnB who can try to do something about it.


  5. One thing about the AirBnB review system you didn’t mention: you can leave private feedback only the owner will see.

    I think you are absolutely right when you say “tenants might be more hesitant to leave a negative comment about a fellow human being”.. I had the same feeling when I reviewed my first experience last month. I didn’t want to make the owner look bad for what I thought was a minor inconvenience so I decided to share it privately.

    However, it’s very likely what was a minor inconvenience for a single guy would have been more distressing for a family with a kid.

  6. Makis Says:

    Very good article. I would like to say that the problem is on your host’s behavior than Airbnb. His 16 reviews might be valid and only prove that when everything is running smoothly, he is a good host. Your comment though could REALLY help guests understand that if there is a problem, this host is not taking the good decisions.

    I am using Airbnb since 2011, and I have few negative reviews on my total 154 reviews from people that while on my properties faced a problem and despite my efforts (I have given full refund to guests, I offered to help them find something else without paying for their stay on my apartment) they wanted to complain. I don’t blame them! But I think that you should focus on the way your host deals with the problem rather than the problem itself, especially when it seems that there were very little the host could do to prevent them. (I had a negative review once because there was a lot of noise from a restoration of a building close to mine…)


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