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Airbnb unveils new China strategy after management shakeup

Photo: Airbnb

Airbnb has announced its new plans for China, where the American online marketplace and hospitality service provider will strengthen cooperation with the local governments, increase the number of offices and hire more employees for key departments.

In a recent interview with yicai.com, a leading business news portal in China, Airbnb's co-founder and chief strategy officer Nathan Blecharczyk, who was recently named as the new head of Airbnb China, released a new strategy for the Chinese market. It is the first time that Airbnb has rolled out a comprehensive China strategy since entering the country in 2015.

The announcement of the China strategy came just less than a month after Airbnb's former China chief Ge Hong departed abruptly just months into the top job there. Ge's departure was interpreted as a sign that Airbnb was facing difficulties and challenges from the fierce local competitors and regulations.

So, the new China strategy reflects the high hopes Airbnb puts on China, as Chief Executive Officer Brian Chesky has pledged to double investment in the country. This year, Airbnb renamed its service in China as "Aibiying", in demonstration of the company's ambition of enhancing its presence in China, one of the largest travel markets in the world.

Localization plan

In the interview, Blecharczyk said that Airbnb will establish a customer service center in China and increase investment in customer service channels in the social media platforms, with a plan to recruit 150 customer service specialists in the following year.

The increased investment in customer service channels in the social media platforms and instant messaging software reflects Airbnb's focus on young customers because most users of these social apps in China are young people.

The company will also strengthen localization in Shanghai, Sichuan province and Guangdong province by setting up offices there in 2018, and will design outbound travel schemes for Chinese customers, according to Blecharczyk.

A report released by the China Tourism Academy showed that the number of China's outbound tourists reached 62 million in the first half of 2017, representing an increase of 5.1 percent from the same period of last year. The report predicted that the consumption of Chinese people travelling overseas would surpass $109 billion in 2017.

When he was appointed as the new chief of Airbnb's China operations, Blecharczyk pledged to make the greatest efforts to grow the company's business in China by increasing investment. He also said that he would meet the property owners in China every month.

Bigger market than US

According to statistics from Airbnb, the number of people booking stays in China and the number of  Chinese customers travelling overseas via Airbnb increased 250 percent and 110 percent respectively in the past year.

Based on the data, Airbnb expects China to be the largest source of customers by 2020.

Blecharczyk said that China has become a market whose business grows faster than the United States.

Previously, iResearch issued a report which predicted that the transaction scale of China's short-term home-rental market would reach 16.9 billion yuan in 2018, doubling the figure in 2016.

Despite the big business opportunity in China, Airbnb still faces challenges from the competitive local players. Tujia and Xiaozhu, the two leading domestic home-rental service providers, have recently completed a new round of fundraising, as part of their plans for business expansion at home.

Nevertheless, Blecharczyk believed that the competition in China has not entered the white-hot phase because the Chinese market is still at a nascent stage, which needs to be further explored.
 


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