AirBnB: Facing Late Entrant Disadvantage in China

Multinationals struggle in entering emerging markets, especially one as complex and regulated as China. Indeed, many have already failed or have been restricted from operating there. AirBnB pioneered a unique hospitality idea perfect for the rise in ‘sharing economies’ and has been successful in many countries. However, when it entered China, it found that local upstarts like Tujia had already established dominant positions. In addition, Tujia had innovated and taken on property management. AirBnB changed its name change to Aibiying in order to localize but found out that the word has some offensive connotations and hence, was not received well. This case study describes AirbBnB’s multiple challenges in competing in China including understanding local cultures and preferences, dealing with competitors, and even navigating the complex regulatory restrictions. The case raises interesting questions about how AirBnB can change its marketing strategy in order to overcome its rough start in China