Airbnb is one of the biggest online marketplaces for rental homestays. However, in 2010, Airbnb was a relatively unknown brand with the vision of an online portal for people who wanted to rent out their homestays to travellers. Fast forward to today, and Airbnb is one of the most recognisable brands and has business in over 220 countries and regions worldwide. Airbnb’s journey from an unknown online marketplace to an internationally renowned brand offers us insights into the strategies that are necessary to grow your startup.
The most important thing for any startup is to build a good foundation. This means refining business and revenue models, ensuring that your product or service is in demand in the market, and building a loyal customer base early on. In the case of Airbnb, this meant fine-tuning their app or portal to ensure that the needs of both host and guest are fulfilled. They created a streamlined process that conducted verification with the help of IDs and provided a secure payment portal. This made them an industry leader, and the rest just followed suit. As a result, Airbnb is a giant in the industry with the most loyal customer base and a good chunk of the market share.
Conducting precise and relevant market research is important when scaling a startup. This mainly consists of analysing competition, consumer behaviour, the regulatory ecosystem, and cultural differences in your target audience. One great example of this strategy being used, even today, is Netflix. Every once in a while, Netflix conducts thorough research and surveys. This helps them understand the consumer mindset and the shows or movies they would rather watch. This is even more evident when they enter a new market. The content that they provide in India is a lot different than what they provide in the States. This results in satisfied consumers, irrespective of language, religion or geography.
Today, technology is the name of the game. Any business that has access to state-of-the-art technology and knows how to use that technology to its benefit is poised to achieve big. That includes using technology in advertising. Search engine optimisation and social media platforms can help businesses reach their target audience significantly. Dropbox is the perfect example of this. When Dropbox expanded internationally, it used an incentive-based system, incentivising its existing users to invite more friends to the network. This resulted in rapid customer growth in pretty much all the markets they entered.
No one can achieve success alone, and this is a well-known fact in the startup ecosystem. For this reason, startups form partnerships, either with their fellow startups or existing and established companies. Forming strategic partnerships with other companies provides startups with resources and insights into the market they are trying to enter. For example, when Uber started its business, it partnered with various local transportation firms to gain notoriety and understand local market dynamics, which helped them scale their business. Similarly, Paytm partnered with Alibaba and leveraged their experience and, most importantly, their infrastructure to scale their business.
Change is the key to being in business for a long time, especially when expanding to different areas. Adapting to the needs and preferences of others is vital. A study by McKinsey found that personalised products or services can improve customer satisfaction by more than 20%, lead conversion by 10% to 15%, and decrease product or service return by almost 40%. Many people wonder why McDonald’s has different menus in different countries and regions. This is mainly because McDonald’s conducts apt research to understand what their clients like to eat and make their products accordingly. This is why McDonald’s is the most successful fast-food chain on the planet. The same is the case with Coca-Cola, which keeps its recipe intact but customises its market campaigns based on the country.
As a relatively small startup, one cannot imagine conducting business in the USA while being a sitting duck in India. This is the next strategy. Always have a local presence. This is not applicable on the largest scale but also at low scales, like expanding from one city to another. Having a local setup helps startups streamline their operations and gain credibility in a new market. One example of this is Google. Whenever Google steps into a new market, it sets up a new office there. This allows them to understand better and serve their clientele.
Scaling a business requires weeks, sometimes months, of brainstorming to develop the right strategy. India has over 1.12 lakh startups, which will only increase. Using the right scaling strategies is vital for these startups to grow nationally and internationally.
