VRIO analysis is an internal analysis tool which helps the company in identifying the competitive advantages of the resources and capabilities. It is the acronym of Value, rarity, imitability and organization. The company work hard to achieve the component of the VRIO to add value in the operations and exploit the resources to avail opportunities. Here is the detailed VRIO analysis of Airbnb.
Airbnb is one of the famous online marketplace providing the services for arranging the lodging, tourism experiences, homestays etc. The company does not involve in providing the services of real estate listings and it does not host any events. It acts as a broker and receive the commissions from every single booking. (Airbnb, 2020).
Value
Value of the resources and capabilities is an important element for the company, as these resources and capabilities help the company in adding value and achieve competitive advantage. Airbnb is one of the very first company in the industry or market. Airbnb was able to enjoy the opportunities which first one in the industry can and achieve all the competitive edge in the market.
It also set the rules for other companies who enter in the industry. Airbnb resources and services are also valuable in terms of prices as it offers lowest process as compare to its rivals. It makes sure not to compromise on the quality and yet dominate the sector. The company is successfully achieving this (Stavrakis, 2018).
Rarity
Rarity is very important component for the company. Rarer the resources are, the more beneficial will be for the company. Airbnb has enjoyed the perks of being the first one in the sector. It made its position strong and rare. The idea of the Airbnb was very rare and creative. Moreover, offering the good quality service in lowest prices is very rare these days. The facet of this is very rare in case of Airbnb.
Airbnb has successfully develop the strong brand equity which are rare. The company is successful in developing loyal customer base who are not willing to switch to other companies. it has successfully build the rare platform which is easy to operate and fast in real-time (Perry, 2018).
Imitability
Imitation of the resources should be difficult for the companies, as this helps them in exploiting more opportunities and enjoy economies of scale. Airbnb is leading the sector and successful in developing the culture which is difficult and costly to imitate. Competitors will be required by huge capitalization for imitating this. Moreover, Airbnb has created the platform which involves advance technology and design.
It is not impossible to imitate but it is costly because of the involvement of variables. Airbnb deals in too much volume which is difficult for the companies to operate on such levels. Because of this, Airbnb provides the lowest possible prices to its customers. This business model is difficult to imitate (Stavrakis, 2018).
Organization
This is the last component of the VRIO framework, as organizing the operations of the business and companies are very important. Airbnb is very successful due to its strategies, policies, procedures, and operations. The company is successful in organizing the operations and employees. Airbnb motivates its employees by providing a good working environment.
Moreover, supply chain and distribution channel of the company is well maintained and organized. Airbnb works hard in making the organization culture strategic and manage accordingly (Perry, 2018).
Conclusion
Airbnb is the first company in the sector, as it successfully develops its strong position and retain the position. The company successful in achieving the valuable, rare, difficult to imitate and organized resources and capabilities. Airbnb is successfully enjoying the competitive advantages in many different areas in business.
| Resources/Capabilities | V | R | I | O | |
| Supply Chain | ✓ | ✓ | ✓ | Competitive Parity | |
| Prices | ✓ | ✓ | ✓ | ✓ | Competitive advantage |
| Inventory management | ✓ | ✓ | ✓ | ✓ | Sustainable advantage |
| Brand Equity | ✓ | ✓ | ✓ | ✓ | Sustainable competitive advantage |
| Marketing | ✓ | ✓ | ✓ | ✓ | Sustainable advantage |
| Product quality | ✓ | ✓ | ✓ | ✓ | Sustainable advantage |
| Product range | ✓ | ✓ | ✓ | Temporary advantage | |
| Talented HR | ✓ | ✓ | ✓ | Competitive parity |
References
Airbnb, 2020. About us. [Online], Available at: https://www.airbnb.com/diversity, [Accessed on: 22nd March, 2020].
Stavrakis, A. 2018. Airbnb strategic analysis. [Online], Available at: https://www.slideshare.net/AnthonyStavrakis/airbnb-strategic-analysis, [Accessed on: 22nd March, 2020].
Perry, A. 2018. VRIO analysis of Airbnb, what is next? [Online], Available at: https://www.case48.com/vrio-case/25183-Airbnb-What-s-Next, [Accessed on: 22nd March, 2020].