how much is your spare room worth? airbnb case study for e commerce
TRANSCRIPT
How much is your Spare Room Worth?E - Commerce
Group 9: Faruk Hasic | Ananya Jain
http://nextjuggernaut.com/blog/airbnb-business-model-canvas-how-airbnb-works-revenue-insights/
: Business Model
Every one of the million-plus listings on our site is unique, having its own address, size, and decor. Our hosts also vary in their willingness to play concierge, cook, or tour guide
: Initial pricing issue
…..unlike
1. Price-setting algorithms
2. Price tips
: Pricing mechanism faced trouble
1. Interact with users
2. Adjust to demand
: Solution seeked
: Situations
: Aerosolve
: The tool
Bases a price tip from the median
Factors in Demand
and seasonalit
y
Finds the ones which
have been successfully booked
Looks at listings
with similar attribut
es in similar areas
System attracts
key attributes of that listing
Host adds a space
Figuring out the key attributes themselves
: The tricky part…
: SOLUTIONSI
MIL
ARIT
Y
RECE
NCY
LOCA
TIONLooked up
highly quantifiable common attributes for which the client will pay
Travel market is dynamic and seasonal.
Listings in almost the entire city, so detailed micro-neighborhoods
: Another FLAW - corrected
FLAW: Expanding circle around a listing, considering similar properties at varying radii from the listing location CORRECTED:Map the boundaries of neighborhoods: extremely accurate and relevant geospatial definitions to cluster listings around major geographical and structural listings.
: Remaining weaknesses
1. Static pricing tips
2. Tool itself is static
: Recent improvements
1. Each host gets new pricing tip every day for each available data in the future
2. A lot of historical data, requires a lot of computing resources
3. Allow easy interpretation and in some cases influences the thought process
: Machine learning model
How much is your Spare Room Worth?E - Commerce
Group 9: Faruk Hasic | Ananya Jain