At first glance, Uber and Airbnb have a lot of similarities. They’re both unicorns and they’re often two of the first names tossed out when the conversation turns to disruptive. Airbnb and Uber also have significant growth in common, in part thanks to partner and affiliate marketing.
However, the strategies are almost diametrically opposed to it, as Keith Posehn, head of performance partnerships at Uber, and Ashwin Krishnan, who handles business development at Airbnb, discussed at the recent Impact Growth 2018 event.
An Overview of Airbnb Affiliate Marketing
Krishnan describes Airbnb as a two-sided market: finding a place to stay and finding someone to host. Unlike the Amazons and eBays of the world, the program is closed. Not everyone can become an Affiliate Partner; Airbnb selects them manually.
Airbnb has seen incredible growth which has made the company much more brand aware. Having essentially overtaken some of its first partners, Airbnb is now much more demanding with its partners.
âThe nature of buyer behavior is only detailed on a few travel sites,â Krishnan said. “When people buy travel, there are only a handful of partners who can drive the type of scale that would be right for us.”
For Krishnan, a good solution is any business that complements the thinking about travel. Examples include “planes, trains, automobiles” and publishers who create content around, for example, traveling with pets.
Understand Uber’s partnership strategy
On the other hand, Uber offers a much more varied range of products and services. There is the basic carpooling program, Uber for Business and an Uber Visa card. And then Uber Eats needs several levels of different partners, from the people who order food to the restaurants that provide it and the couriers that deliver it.
âSome of our partners, we’re consuming all of their inventory because we have to,â Posehn explained. âWe must continue to acquire partners to maintain this rate of growth, because as we conquer one market, we now have another. We must continue to make this work. ”
As a result, Uber needs supply to create demand. If there aren’t enough drivers to pick up people quickly, consumers will get impatient and desert the platform. This results in what Posehn called the âfeedback loopâ where more partners means more drivers, who refer other drivers. that finally results in more runners, who also refer more runners.
âWe need to approach partner marketing with the same rigor as any other business development,â Posehn said. âWe depend on partners. It’s not like Google, where I can add a keyword and set my bid and voila, there is more traffic.
Airbnb has traditionally focused on internal business development, convincing people inside of what Airbnb can become to drive adoption. With so many different moving parts – management, attribution, and reporting, to name a few – the business is not suited to create proprietary technology for affiliate marketing.
âWe weren’t equipped for this, so we turned to Impact to help us alleviate some of the internal burden every time we take on a new partner,â Krishnan explained. âIt helps shorten the business development cycle and accelerate the kind of adoption we get from partnerships. “
Technology is no longer a limiting factor in Airbnb’s dynamics. On the other hand, Uber has built its own platform. It is extremely difficult, given the work it takes to maintain.
âWhen you try to build yourself up, you accumulate technical debt at an astounding rate because you have to keep up with the system and how it works,â Posehn said. âYou are constantly repaying through engineering, so you incur operational debt at the same time. “
Back to similarities: Uber and Airbnb are huge global entities that operate collectively pretty much everywhere. Even Nauru, a small island in the South Pacific that is the least visited country in the world, has two Airbnb listings.
And the two companies operate more or less the same in each of them. Uber drivers have the same playbook whether they’re in San Francisco or Saudi Arabia.
Another thing Airbnb and Uber are sharing is a plan to keep using affiliate marketing to facilitate growth. Airbnb sees dynamic content as a big growth opportunity right now, while allowing APIs to show publishers what’s available in real time. Likewise, Uber’s primary focus is integration, which Posehn sees as the key to understanding data early enough for it to have an impact.
âWe break down our lines of business where I can literally say, ‘Profit for drivers equals these things in order and in a funnel,’ Posehn said. âThe pro tip I would give to everyone now – it sounds very silly – is math. “