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Marketing Brand Strategy Airbnb

Airbnb CMO on ditching performance marketing for big, bold brand campaigns

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By Kendra Barnett | Senior Reporter

August 24, 2023 | 13 min read

We catch up with the rental app’s marketing boss, Hiroki Asai, to hear why he shifted its strategy so dramatically and how he’s confident it has now found a winning long-term formula.

Airbnb app

Airbnb's Hiroki Asai opens up about the value of keeping product development and marketing in dialogue / Adobe Stock

An Airbnb ad launched today spotlights the perks of staying in one of its rentals rather than traditional hotels. In one of three playful, animated short films, a group of friends is ready for a relaxing, kiddo-free vacation – only to find the hotel pool teeming with screaming children. Luckily, the travelers find solace in a picture-perfect thatched-roof Airbnb with a peaceful, private pool. “Get an Airbnb and get a place to yourself,” a voiceover chimes.

The spot is part of a new brand campaign that will roll out across the US, the UK, Canada, Australia and a handful of other markets across the globe throughout the coming weeks.

It comes on the heels of the brand’s multichannel spring campaign, which spotlighted Rooms – Airbnb’s newly-rebranded offering of private rooms within shared homes – by telling the story of individual hosts from across the globe and the unique experiences that can come with a Rooms stay.

These and other Airbnb marketing efforts of the last few years evidence a broader paradigm shift in the way the brand aims to connect with and engage audiences everywhere. It’s a shift that began with the Covid-19 pandemic.

A strategic shift

When the pandemic upended the travel and tourism industry in 2020, Airbnb lost about 80% of its business overnight. As Brian Chesky, the company’s chief executive, told entrepreneur and ‘This Week in Startups’ podcast host Jason Calacanis: “We were staring into the abyss.”

Although the existential disruption may have easily sunk the business, Chesky and his team were determined to tackle the crisis opportunistically.

The challenge wasn’t in the remit of product, operations or finance alone. Marketing, too, would play a critical role. “It basically turned the company upside down – but it was also an opportunity to reimagine Airbnb a little bit and take a look at what the next iteration of Airbnb would be,” chief marketing officer Hiroki Asai tells The Drum.

The company’s founders, including Chesky, chief strategy officer Nathan Blecharczyk and chairman Joe Gebbia, sought to make Airbnb “a much simpler company” says Asai – one that was “creatively driven,” with brand and design at the heart of the corporate story.

For Asai, who has been at Airbnb for about three and a half years, the approach felt natural. The executive began his career as a graphic designer before spending 18 years on the marketing team at Apple. A core focus on design and brand-level storytelling is in his DNA.

Pre-pandemic, Airbnb’s marketing strategy was primarily performance-driven, with much of the brand’s marketing budget dedicated to digital advertising. But when the pandemic flipped the business on its head, performance marketing wasn’t delivering what the brand needed. Asai tells The Drum: “The problem was that Airbnb wasn’t able to put its own message out into people’s minds and out into the market, so the messages were being driven by reactive PR and comms and basically what the world and what social media was talking about. Airbnb kind of lost control of the brand a little bit – and of the message and the narrative.” To regain control of the narrative, Airbnb decided to dial back its investment in performance marketing significantly.

Instead, Asai says, the plan was to “go back to the core of what Airbnb was about – which is about core hosts, primary homes and guests.” The brand poured marketing dollars into communicating this message with big, bold brand campaigns instead of performance-driven buys.

It was a much-needed strategic adjustment, in Asai’s view. “As Airbnb was growing, pre-pandemic, it was losing its differentiation. There were a lot of competing options for travelers out there and Airbnb … was losing its uniqueness. It was losing its sense of brand and who it was. So, coming out of the pandemic, the decision was to really focus on the core business and to focus on creating experiences, creating features and creating a product … to differentiate ourselves – and then to use brand to actually communicate and teach people what those differences are.”

Keeping product and brand in dialogue at all times

The brand began to invest deeply in developing and highlighting specific features and tools that set its product and experience apart. For example, a key focus of the last few years has been building out Airbnb Categories – classifications of home types, styles and locations that help users find inspiration, discover unique stays and narrow down their search. Last year, Airbnb launched a campaign showcasing its range of over 60 Categories to explore on the platform – from treehouses and off-the-grid cabins to private islands and luxe mansions. It told the stories of travelers staying in some of the platform’s most unexpected and exciting homes, like a giant potato in Idaho and a cave home in Utah.

As Asai explains: “At the core of what we need to do is to create a product and experience that’s different than any other service. And to do that, we need to innovate on the software, on the technology. And we want to use brand not just to advertise our values and what we’re about – we also want to use brand to help explain what these features are and how they make for a different experience.”

And the shift change has largely paid off. Following the decision to reduce performance marketing spend, Airbnb’s traffic levels reached 95% of what they had been in 2019 before the pandemic. Chesky said in 2021 that the brand would never again rely so heavily on performance marketing. And two years after the decision to reallocate marketing spend, the company reported its most profitable fourth quarter on record in February 2023. Revenue jumped 24% year-over-year, helping Airbnb reach an Ebitda of $506m for the quarter.

Since the strategy is proving effective, Asai and his team are only digging deeper into ways to communicate product differentiators through a brand-first approach. Airbnb’s Rooms campaign earlier this year, he says, has been a successful example. “Our approach is that product development and marketing should go hand-in-hand. We’ll work off of one central customer insight that then feeds what we do on the product – and that same insight also feeds how we market it and how we talk about it in paid media and in PR.”

With Rooms, the central insight was that many Airbnb users were interested in more cost-effective stays but were skeptical of staying in a shared home where they knew very little about the host. “The barrier that’s keeping [users] from booking Rooms is that they really don’t know who that host is and need some insight. That led to this idea of a Host Passport and adding more than just kind of dry facts [and instead adding] more insights into the space, who the host is, the hosting journey, why they’ve decided to rent the room, the story of their home. Then that same insight fed the advertising in a way that put the experience [front and center].”

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The in-housing philosophy

Airbnb is able to keep product and marketing so tightly interwoven in large part due to the brand’s in-housing model, according to Asai. Not only is all product development and technology design done in-house, but so too is the company’s marketing and advertising. As the executive puts it: “What that allows us to do is to have a very, very tight system for all customer-facing things, from marketing down to product – and to work off of one insight in an extremely integrated and consistent way.”

Operationally, too, Asai says, in-housing makes sense for Airbnb as it helps the company run a tighter ship. “It’s so much easier to not deal with multiple agencies and to not deal with what the agency wants to do versus what you want to do – plus timelines, cost, just the layers of management you have to have to keep those relationships going. More importantly, I think you get a much better creative product when you have the people that create the advertising sitting literally right next to the people that make the product.”

It’s an approach Asai believes in wholeheartedly. “I’m really bullish on in-housing creative because I’ve worked on both sides of the fence – I’ve worked on the agency side, on the design firm side, then as an in-house creative and then ultimately on the marketing side. I’ve seen all ends of it and I really think people with a creative background get shortchanged working on the service side – I think amazing work happens out of agencies, but I think for creative to grow, they really need to be exposed to everything that happens upstream … and everything that happens downstream. Being in-house really gives you that visibility in that breath. Ultimately, it makes you a better designer, makes you a better art director, makes you a better writer.”

Nonetheless, he acknowledges that in-housing may not be the appropriate model for every brand. He admits it can be “a very difficult thing to manage.” Airbnb, in his opinion, is uniquely poised to benefit from the model because of its roots in commercial creativity. “The reason it works for Airbnb is because we have creative founders and creative leaders. Our CEO was trained as a designer, so he has a unique understanding of the creative process and can champion it and make it work and he is really involved in the work.” But in-housing, Asai says, “is really not for everyone.”

Mapping out new frontiers

When it comes to the brand’s future, Asai is confident that the continued integration of product and marketing will be a boon to the brand’s success.

As it looks to the future, a major focus for the brand in the near- to medium-term is expansion into new markets. It’s a goal Chesky spoke about openly on the company’s latest earnings call earlier this month: “The next big focus for Airbnb is reliability. If we can make Airbnb even nearly as reliable in many markets as hotels, I think you’re going to open up a whole new generation of travelers to Airbnb.” In particular, the company is eyeing Asia Pacific, which Chesky says represents “a huge opportunity for growth.”

It’s a plan that Asai is eager to take part in, adding: “It’s also super exciting to be able to introduce Airbnb to whole new audiences and cultures.”

As the company aims to expand, a focus on brand-centric marketing will remain a key part of the growth strategy, with Chesky saying during that Q2 earnings call: “When you invest in a brand, when your brand’s a noun and a verb, and you have something unique, you get a lot of … benefits. And I think it’s going to be consistent and we’ll have pretty consistent marketing spend as a percent of revenue over time because of the strength of the brand.”

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