Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits?
Hundreds of thousands of would-be hoteliers have been popping up all around the world, hoping to rent their own homes and apartments to complete strangers through a service called Airbnb. The goal of Airbnb's aspiring hosts was to use the company's website to attract guests who were willing to pay the highest rates to stay in their homes for a short time. For Airbnb, the goal was to improve customer review performance so it could, in turn, increase profits. How could the company achieve its goal? Enter text mining, a technique that allowed businesses to scour Internet pages, decipher the meaning of groups of words, and assign the words a sentiment proxy through the use of a software package. In order for text mining to be useful for Airbnb, its marketing professionals first had to gain access to customer review data on the company's own website. The team then had to analyze the data to find ways to improve property performance. Was the team going to be able to leverage this large amount of data to determine a strategy going forward?
Swot Analysis of "Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits?" written by Shea Gibbs, Rajkumar Venkatesan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Airbnb Text facing as an external strategic factors. Some of the topics covered in Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? case study are - Strategic Management Strategies, Financial analysis, Marketing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? casestudy better are - – digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, increasing government debt because of Covid-19 spendings, increasing commodity prices, wage bills are increasing, there is backlash against globalization, challanges to central banks by blockchain based private currencies,
customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Airbnb Text, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Airbnb Text operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? can be done for the following purposes –
1. Strategic planning using facts provided in Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? case study
2. Improving business portfolio management of Airbnb Text
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Airbnb Text
Strengths Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Airbnb Text in Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? Harvard Business Review case study are -
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Airbnb Text digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Airbnb Text has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Operational resilience
– The operational resilience strategy in the Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Superior customer experience
– The customer experience strategy of Airbnb Text in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Airbnb Text has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Innovation driven organization
– Airbnb Text is one of the most innovative firm in sector. Manager in Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Airbnb Text has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Airbnb Text has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Analytics focus
– Airbnb Text is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Shea Gibbs, Rajkumar Venkatesan can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Highly skilled collaborators
– Airbnb Text has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Airbnb Text has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Sales & Marketing industry
– Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? firm has clearly differentiated products in the market place. This has enabled Airbnb Text to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Airbnb Text to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Airbnb Text in the sector have low bargaining power. Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Airbnb Text to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Sales & Marketing field
– Airbnb Text is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Airbnb Text in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Airbnb Text has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, Airbnb Text has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Need for greater diversity
– Airbnb Text has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Low market penetration in new markets
– Outside its home market of Airbnb Text, firm in the HBR case study Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Airbnb Text has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Products dominated business model
– Even though Airbnb Text has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? HBR case study mentions - Airbnb Text takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
No frontier risks strategy
– After analyzing the HBR case study Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits?, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Workers concerns about automation
– As automation is fast increasing in the segment, Airbnb Text needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Airbnb Text supply chain. Even after few cautionary changes mentioned in the HBR case study - Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Airbnb Text vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of Airbnb Text products
– To increase the profitability and margins on the products, Airbnb Text needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? are -
Leveraging digital technologies
– Airbnb Text can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Airbnb Text to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Creating value in data economy
– The success of analytics program of Airbnb Text has opened avenues for new revenue streams for the organization in the industry. This can help Airbnb Text to build a more holistic ecosystem as suggested in the Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? case study. Airbnb Text can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Airbnb Text in the consumer business. Now Airbnb Text can target international markets with far fewer capital restrictions requirements than the existing system.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Airbnb Text can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Airbnb Text has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Airbnb Text is facing challenges because of the dominance of functional experts in the organization. Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Manufacturing automation
– Airbnb Text can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Airbnb Text can use these opportunities to build new business models that can help the communities that Airbnb Text operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Building a culture of innovation
– managers at Airbnb Text can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Airbnb Text in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Airbnb Text can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Airbnb Text can develop new processes and procedures in Sales & Marketing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Threats Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? are -
Consumer confidence and its impact on Airbnb Text demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Technology acceleration in Forth Industrial Revolution
– Airbnb Text has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Airbnb Text needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Airbnb Text will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Stagnating economy with rate increase
– Airbnb Text can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits?, Airbnb Text may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Increasing wage structure of Airbnb Text
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Airbnb Text.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Airbnb Text needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Airbnb Text in the Sales & Marketing sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Airbnb Text high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Regulatory challenges
– Airbnb Text needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Sales & Marketing industry regulations.
Shortening product life cycle
– it is one of the major threat that Airbnb Text is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Have Text, Will Travel: Can Airbnb Use Review Text Data to Optimize Profits? is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Airbnb Text needs to make to build a sustainable competitive advantage.
