Start-up, unicorn, global player: how Airbnb has applied design thinking
When Airbnb was founded as a small community marketplace in Silicon Valley in 2008, hardly anyone knew about it. Today, there is probably almost no one in the world who hasn’t heard of the platform, which is shaking up the global hotel industry. Now active in over 220 countries, Airbnb quickly grew into a global player and continues to profit from the sustainability trend as part of the sharing economy. Before COVID-19, Airbnb was valued at 35 to 52 billion dollars on the secondary market, and the company planned to list it on the stock market in 2020.
Why isn’t anyone booking reservations on our site? Customer perspective as the key
In a video from FirstRoundCapital, co-founder Joe Gebbia provides inspiring insights into how he used design thinking to transform Airbnb from a failing start-up to a billion-dollar business.
The key to solving the problem of decreasing booking figures was seeing things radically and impartially from a customer perspective. This enabled the three-man founding team to identify what needed to be improved the most on their portal: the photo quality of apartments and accommodations being offered was not good enough for customers to get a real idea of what they were booking. After all, customers want to see what they will be getting for their money.
Consistent growth through consistent use of Design Thinking
Without first making calculations and drawing up cost/benefit forecasts, the team took it upon itself to visit hosts and take its own high-quality pictures of the apartments. This demanded courage, investments, and a willingness to move away from purely data-based analysis, overcome any social anxiety they had, and develop a true understanding of the target group and its needs.
As soon as the better photos were uploaded, success was quick to follow, and the number of bookings skyrocketed from that point on.
Design thinking is now common practice at Airbnb and finds expression in a range of typical methods:
- Taking a customer perspective: Every new employee first has to complete a trip booked via the portal and report on his or her experiences.
- Adhering to the phases of design thinking: New development processes begin with a creative hypothesis alone; data and feasibility studies do not play any role initially.
- Prototyping and testing: New features are first tested as prototypes in certain areas of the site. They are then optimized based on customer feedback before being expanded across the whole platform.
Guided by radical customer centricity: a design thinking role model for start-ups
Many start-ups have found themselves in the same situation as Airbnb at the time it introduced design thinking. They had a good, flawlessly coded product, had calculated and analysed all performance-relevant parameters and KPIs, but success remained to be seen. Why? Because the product could not fulfil the paramount need of the target group — to select a place to stay based on photos.
The problem therefore simply came down to content. Recognizing this meant stepping out of the shoes of a programmer and developer and radically adopting the customer’s perspective. The result was a success story that set a precedent. The application of many typical steps of the iterative design thinking process is now part of the DNA of most start-ups without them even realizing it.
- Built a culture of experimentation
- $200 weekly profits to “unicorn”
- Scalable to non-scalable risk
- Changed star to heart — utility driven
- Increased engagement by 30%
- Why Designers Need to ‘Become the Patient’ to Build Better Products
Design Thinking is becoming quite a buzz these days. If you wish to learn this problem-solving skill, then apply now for the Design Thinking: From Insights to Viability.