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Improving the Customer Experience at Airbnb

Assignment Brief

MKTG 30673 - Improving the Customer Experience: Individual Assignment BRIEF: 2020/21

Scenario

You are an independent Customer Experience Consultant approached by several firms to consult them on how to best improve the experience of their customers. At this point in time you are about to choose to focus your energy on one client out of three different options:

  1. A firm that either implements ‘internet of things’ (IoT), or robotics, or customer self service devices in its service (i.e. Samsung Alexa, or firms that offer self-service checkouts such as stores or self-service check-in services such as airlines)

  2. A firm that adopts a sharing economy business model (any C2C firm, such as Airbnb )

  3. A firm that maintains a Call Centre (either in-house or outsourced) to provide service to its customers (any type of firm might offer this type of service, such as telecoms, banks, utility firms, retail chains, etc).

You are required to select a client firm and develop  a Customer Experience Improvement plan for the Marketing Manager of the client firm of your choice. In developing the report, you are expected to explore and review elements of customer experience relevant to the customers of your client firm and to develop an action plan for improving it. You are expected to produce a report that is theoretically underpinned by knowledge of the concepts relevant to improving customer experience and develop a plan that applies the theoretical approach that you have adopted.

Instructions

  1. You may choose only one of the above three options, yet you MUST get agreement from your tutor. Please note that this assignment is based on a review of relevant literature and available secondary data. Direct and personal contact with your chosen organisation is strictly forbidden.

  2. Submit your work in pdf format via NOW by 11 pm Monday the 17th of May, 2021.

Requirement

This assignment comprises a 4000-word individual report that represents 100% of the module grade. There are three sections to your report:

Section One: Introduce the reader of the report to a review of the current status of the customer experience of the firm’s clients. In this section you may identify a challenge the firm is facing, or a problem that customers complain about or the disadvantages of the current customer experience system in place. Remember your analysis will only be based on secondary sources (including publicity on the firm, social media posts, public comments on brand communities etc) or your personal observations/experience as a customer of the firm. Be clear about what the problem/challenge is in order to impress your boss. This section is rather relatively short [recommended about 500 words]. So, your analysis must be concrete and precise.   

Section Two: Provide a critical analysis of the literature on improving the customer experience in the context of the above options currently in operation within your chosen organisation. In order to do this, you will need to draw on relevant concepts, theories, and models identified throughout the module as well as examples of best practice used within the industry.  Remember you are expected to be critical in your review of relevant concepts and theories. This is really an opportunity to impress your boss with your knowledge! Demonstrate what lessons can be drawn from the academic literature and apply them in your proposed plan of customer experience improvement. [Aim for around 2000 words]

Section Three: Based on your analyses in sections One and Two, recommend a new strategy and action/implementation plan to improve the customer experience of your client firm. This section provides you with a chance to contribute to your firm, by applying the learning achieved from the reviewed literature and the desk research on the challenge at hand. In this section your ability to apply the theoretical leaning, as well as your strategy development and planning skills, will be considered. [Aim for around 1500 words]

Further Guidance

A. Content

Title page: Title page should include your student number, the module name, the name of the organization, title of the work, and word count. [Not included in the word count]

Executive summary: Should be a maximum of one page and should summarise the key points in your report, including all three sections. [Not included in the word count]

Section One: Provide a critical analysis of the how the firm manages the customer experience currently within your chosen organisation. The analysis includes identifying (1) what the company has done well and (2) what the company does not do well. In order to do this analysis, you will need to draw on secondary sources of customers’ experience of this firm’s service provision, and where possible/relevant, on examples of best practice used in the respective industry. In this section, you may want to consider:

  • Any evidence from observations you have made such as a service blueprint and detailed notes about how different customers experience the service of the company

  • Any customer feedback on the effectiveness of the customer experience (such as an analysis of social media posts)

  • Publicity relevant to the journey of the customers of the selected firm.

If you need to display figures or evidence of the above, feel free to use the appendices section of the report. The key issue here is to provide evidence of the challenge at hand. Please note that ideally this section should not exceed 500 words.

Section 2: You will need to draw on ICE concepts theories, and models identified throughout the module that relate to the context of the selected option and the specific challenge at hand. You need to exercise your judgment on how to best utilise the academic literature to generate the conceptual foundation of your subsequent strategy and plan.  It is important that you do not simply describe the various practices of improving the customer experience, but rather how to use theory and wider evidence to analyse their effectiveness. To achieve the higher grades, you need to provide evidence of your analysis and relate the analysis to deep understanding of the literature on improving customer experience. You will need to demonstrate a sound understanding of the conceptual and theoretical underpinnings of relevant literature and apply it to the business issues. Please note that ideally this section should not exceed 2000 words.

Section 3: Recommend a new strategy and a plan to improve the firm’s customer experience.  Justify your choice with reference to relevant theory. You need to ensure that your recommendations follow on from your analysis in sections one and two (e.g. it addresses the weaknesses that you have identified in your analysis and the theoretical foundation that emerged from the reviewed literature). Examples of a new customer improvement experience strategy could possibly refer (but may not be limited) to the following:

  • A comprehensive service recovery program

  • An interactive retail store design concept: using theatrical or digital technology

  • An improvement to the blueprint of the operations of the service firm

  • Augmentation of the customer journey using self-service technology

Of course, there are many strategies that you could consider depending on the nature of the challenge at hand, therefore you need to carefully consider all the concepts addressed in the ICE module to identify their relevance to the specific firm situation. Please remember that your suggested ICE strategy/plan may consider:

  • How it fits with the company’s brand values and current brand position

  • Any evidence about the strategic importance of the suggested practice(s)

  • The extent to which the practices align with others used within the relevant industry sector

The key issue in this section is to apply the lesson learned from the literature review in a plan that is reasonable, justified and appropriate.  Remember to use appendices whenever suitable (you may wish to put summary tables, a Gantt chart implementing the time plan or a service blueprint in the appendices, instead of the main body). Of course, you are encouraged to use figures anywhere they seem suitable in the main text as well. The implementation plan should provide details about at least three activities the organization should implement to enhance the success of the new strategy.  These may relate to several elements of the Marketing Mix. Please note that ideally this section should not exceed 1500 words.

Reference List: This includes only references that are cited within the report. Use Harvard referencing style for in text citations and the list of references. Refer to the NTU Harvard referencing style guide https://now.ntu.ac.uk/d2l/lor/viewer/view.d2l?ou=6605&loIdentId=25435

Appendices: Do not use the appendices as a dumping ground – the report should be able to stand on its own without the reader going over unnecessary information. The appendix is to be used only to provide more detailed information, where relevant, so you need to exercise discretion as to what is to be included in the appendices versus the main body of the report.

B. Frequently Asked Questions

  1. Do we need a conclusion?

    • No, a conclusion is not needed.

  2. How strict is the word count?

    • 4,000 words are the complete maximum. The tutors are instructed to not read anything over 4,000 words.

  3. Should I just use the academic literature that is covered in this module?

    • Consider that the academic literature that is referred to in the lectures and seminars as a starting point. You are expected to review additional literature to support the arguments presented in the report.

  4. Is this a business report or an academic report?

    • This assignment is both a business report and an academic report. You should use the context of the selected organization to demonstrate your understanding and critical thinking of how to improve the customer experience. To demonstrate your academic critical thinking, you need to delve deeply and widely into the academic literature of the concepts discussed in the module. To demonstrate your business-related critical thinking, you need to analyse the situation at the organization you have chosen using available secondary data and to provide a well-justified strategy.

  5. I am not clear on what goes into the executive summary.

    • The executive summary should be written last. It should contain the a summary of the 3 sections of the report.  If read as a standalone document it should suffice in fully briefing the reader about the proposed plan.

  6. Do I need to develop a table of contents?

    • No

  7. May I select a not for profit firm or a charity as a client?

    • Yes

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Sample Answer

Improving the Customer Experience at Airbnb

Executive Summary

This report evaluates the current customer experience offered by Airbnb and proposes a strategically grounded improvement plan aimed at enhancing trust, consistency, and post-booking support across the customer journey. Airbnb operates under a sharing economy model where value is co-created between hosts and guests, which creates unique customer experience challenges related to service variability, risk perception, and accountability. Section One reviews the current customer experience using secondary sources such as public reviews, social media discourse, and brand communications, identifying inconsistency and service recovery weaknesses as the core challenge. Section Two critically reviews academic literature on customer experience management, service dominant logic, trust in peer-to-peer platforms, and service recovery theory. Section Three proposes a customer experience improvement strategy focused on structured service recovery, host capability alignment, and proactive journey augmentation. The proposed strategy aligns with Airbnb’s brand values and applies theoretical insights to a realistic and implementable action plan.

Section One: Current Customer Experience at Airbnb

Airbnb has fundamentally transformed the accommodation sector by enabling peer-to-peer exchange at scale. Its customer experience is built around access, personalisation, and perceived authenticity, which differentiates it from traditional hospitality providers. Many customers report positive experiences related to price flexibility, unique properties, and localised travel experiences. Airbnb’s digital interface is widely regarded as intuitive, and the booking process is generally smooth and transparent. These aspects contribute positively to the pre-purchase and booking stages of the customer journey.

However, the core challenge in Airbnb’s customer experience lies in inconsistency during service delivery and post-purchase support. Unlike hotels, Airbnb does not fully control the service environment, as hosts are independent providers with varying standards, responsiveness, and professionalism. Secondary data from public reviews and online forums frequently highlights issues such as misleading property descriptions, cleanliness concerns, last-minute cancellations, and slow dispute resolution. These issues negatively impact trust and perceived fairness, which are critical in a sharing economy context.

A recurring complaint concerns Airbnb’s customer support function. While Airbnb positions itself as a community driven platform, customers often express frustration when disputes arise, particularly in situations involving refunds or safety concerns. The perceived lack of timely human support during service failures damages emotional trust and creates a disconnect between brand promise and lived experience. This is especially problematic because customers tend to evaluate platforms not by average performance, but by how failures are handled.

From a customer journey perspective, Airbnb performs strongly in discovery and booking but weakly in recovery and reassurance. This imbalance suggests that customer experience challenges are not rooted in technology limitations but in governance, service recovery design, and expectation management. Addressing these gaps presents an opportunity to strengthen long-term loyalty and reduce reputational risk.

Section Two: Literature Review and Critical Analysis of Customer Experience Improvement

Customer experience is widely understood as the cumulative cognitive, emotional, and behavioural response to all interactions with a firm across the customer journey. Scholars argue that experience management must extend beyond touchpoints to include emotional outcomes and perceived justice. In service contexts, this is particularly important because production and consumption occur simultaneously, increasing uncertainty and perceived risk.

Airbnb operates within a service dominant logic framework, where value is co-created by the platform, hosts, and guests. While this model enhances scalability and innovation, it also diffuses responsibility. Research on peer-to-peer platforms highlights trust as the central determinant of customer experience quality. Trust in this context is not only interpersonal between host and guest, but institutional trust in the platform’s ability to intervene fairly when problems arise.

Service variability is a known challenge in decentralised service systems. Academic literature suggests that firms managing indirect service delivery must rely on governance mechanisms rather than operational control. These include reputation systems, standards enforcement, and structured service recovery protocols. Airbnb’s reliance on review systems helps signal quality ex ante, but research shows that review inflation and bias reduce their effectiveness over time.

Service recovery theory provides a useful lens for Airbnb’s challenge. Effective recovery is linked to perceived procedural justice, interactional justice, and outcome fairness. Studies consistently show that customers who experience a well-handled failure can become more loyal than those who experience no failure at all. However, this effect depends on timely response, clear accountability, and empathetic communication.

In Airbnb’s case, the platform often positions itself as a mediator rather than a responsible service provider, which weakens perceptions of accountability. Literature on platform responsibility suggests that customers expect higher intervention as platforms mature and professionalise. Failure to evolve governance structures in line with customer expectations can erode trust and brand legitimacy.

Technology enabled customer experience tools such as AI chatbots and automated workflows offer efficiency but may undermine emotional reassurance during high stress situations. Research emphasises the importance of human escalation points in emotionally charged service encounters. This is particularly relevant for accommodation services, where safety and financial stakes are high.

Brand congruence theory further suggests that customer experience strategies must align with brand values. Airbnb promotes belonging and trust, which makes service failures more emotionally salient. When recovery processes feel impersonal or slow, the mismatch between promise and delivery intensifies dissatisfaction.

The literature therefore suggests that Airbnb’s improvement opportunity lies not in further digitisation of booking processes, but in strengthening service recovery design, host alignment mechanisms, and proactive expectation management across the journey.

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Customers increasingly expect the platform to take responsibility when things go wrong.

Recovery has a stronger impact on loyalty than incremental feature upgrades.

Yes, because it builds on existing systems rather than replacing them.

Yes, theory shows why certain strategies work, not just what to do.

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