Free Racial Discrimination on Airbnb (A) Case Study Solution | Assignment Help

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Written by Gary F. Smith
Publish Date: 2024-10-04

Harvard Case - Racial Discrimination on Airbnb (A)

"Racial Discrimination on Airbnb (A)" Harvard business case study is written by Michael Luca, Scott Stern, Devin Cook, Hyunjin Kim. It deals with the challenges in the field of Negotiation. The case study is 20 page(s) long and it was first published on : Mar 5, 2020

In 2016, a study by the National Fair Housing Alliance found that black users of Airbnb were more likely to be rejected by hosts than white users. The study also found that black users were more likely to be charged higher prices than white users.

Airbnb has taken some steps to address racial discrimination on its platform. In 2016, the company launched a new policy prohibiting discrimination based on race, religion, sexual orientation, or gender identity. Airbnb has also partnered with the National Fair Housing Alliance to develop and implement strategies to combat racial discrimination.

However, more needs to be done to address racial discrimination on Airbnb's platform. The company should implement the comprehensive strategy outlined above to ensure that all users are treated fairly and respectfully.

3. Analysis of the Case Study

The case study of racial discrimination on Airbnb highlights the challenges that companies face in addressing this issue. Airbnb is a global company with a diverse user base. This diversity can lead to misunderstandings and conflicts, including those based on race.

Airbnb has taken some steps to address racial discrimination on its platform. However, more needs to be done to ensure that all users are treated fairly and respectfully. The company should implement the comprehensive strategy outlined above to address this issue.

4. Recommendaations

Airbnb should implement the following recommendations to address racial discrimination on its platform:
  • 1. Data collection and analysis: Airbnb should collect data on the incidence of racial discrimination on its platform. This data should be used to identify patterns and trends, and to develop targeted interventions.
  • 2. Policy development and enforcement: Airbnb should develop clear and concise policies prohibiting racial discrimination. These policies should be communicated to all users, and should be enforced consistently.
  • 3. User education and training: Airbnb should provide users with education and training on how to identify and report racial discrimination. This training should be mandatory for all users, and should be updated regularly.
  • 4. Partnerships with civil rights organizations: Airbnb should partner with civil rights organizations to develop and implement strategies to combat racial discrimination. These partnerships should include joint research, advocacy, and public education campaigns.

5. Basis of Recommendaations

The recommendations above are based on the following considerations:
  • 1. Core competencies and consistency with mission: Airbnb's core competency is providing a safe and welcoming platform for users to rent out their homes or apartments. Addressing racial discrimination on its platform is consistent with this mission.
  • 2. External customers and internal clients: Airbnb's external customers are the users of its platform. Airbnb's internal clients are the hosts who rent out their homes or apartments on the platform. Addressing racial discrimination on its platform is in the best interests of both groups.
  • 3. Competitors: Airbnb's competitors include other peer-to-peer rental services such as Vrbo and HomeAway. Addressing racial discrimination on its platform will give Airbnb a competitive advantage over these competitors.
  • 4. Attractiveness ' quantitative measures if applicable (e.g., NPV, ROI, break-even,payback): The benefits of addressing racial discrimination on Airbnb's platform outweigh the costs. The company is likely to see an increase in user satisfaction, host satisfaction, and revenue as a result of implementing the recommendations above.
  • Are all assumptions explicitly stated (e.g., needs, technology trends)' The assumptions underlying the recommendations above are that:
    • a. Racial discrimination is a problem on Airbnb's platform.
    • b. Airbnb has the ability to address racial discrimination on its platform.
    • c. The benefits of addressing racial discrimination on Airbnb's platform outweigh the costs.

6. Conclusion

Racial discrimination is a serious problem that can have a devastating impact on individuals and communities. Airbnb has a responsibility to address racial discrimination on its platform. The company should implement the comprehensive strategy outlined above to ensure that all users are treated fairly and respectfully.

7. Discussion

There are a number of other alternatives that Airbnb could consider to address racial discrimination on its platform. These alternatives include:
  • 1. Doing nothing: Airbnb could choose to do nothing to address racial discrimination on its platform. However, this would be a mistake. Racial discrimination is a serious problem that can have a devastating impact on individuals and communities. Airbnb has a responsibility to address this issue.
  • 2. Implementing a less comprehensive strategy: Airbnb could choose to implement a less comprehensive strategy to address racial discrimination on its platform. For example, the company could focus on collecting data and developing policies, but not on providing user education or partnering with civil rights organizations. However, this approach would be less effective than implementing a comprehensive strategy.
  • 3. Implementing a more comprehensive strategy: Airbnb could choose to implement a more comprehensive strategy to address racial discrimination on its platform. For example, the company could add additional elements to the strategy outlined above, such as providing financial assistance to victims of discrimination or creating a dedicated team to investigate and resolve complaints of discrimination. However, this approach would be more costly and time-consuming than implementing a less comprehensive strategy.

The risks and key assumptions of the recommendation are as follows:

  • Risks:
    • a. Airbnb may not be able to collect accurate data on the incidence of racial discrimination on its platform.
    • b. Airbnb's policies prohibiting racial discrimination may not be effective in preventing discrimination from occurring.
    • c. Airbnb's user education and training programs may not be effective in changing user behavior.
    • d. Airbnb's partnerships with civil rights organizations may not be effective in reducing racial discrimination on its platform.
  • Key assumptions:
    • a. Racial discrimination is a problem on Airbnb's platform.
    • b. Airbnb has the ability to address racial discrimination on its platform.
    • c. The benefits of addressing racial discrimination on Airbnb's platform outweigh the costs.

8. Next Steps

Airbnb should take the following steps to implement the recommendations above:
  • 1. Develop a plan: Airbnb should develop a detailed plan for implementing the recommendations above. This plan should include timelines, budgets, and resource allocations.
  • 2. Implement the plan: Airbnb should implement the plan developed in step 1. This will require the cooperation of all levels of the organization, from senior management to frontline staff.
  • 3. Monitor and evaluate progress: Airbnb should monitor and evaluate progress in implementing the recommendations above. This will help the company to identify areas where adjustments need to be made.

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Case Description

Facing mounting criticism and evidence of widespread racial discrimination on the platform, apartment rental platform Airbnb needed to decide a path forward. For years, Airbnb had given hosts extensive discretion about whether to reject a guest after seeing little more than a name and a picture, believing this was the best way for the company to build trust. While Airbnb ran thousands of experiments per year looking at ways to grow the user base and short-run profit, they failed to track or account for the possibility of discrimination. Should they become more proactive about identifying discrimination on the platform? Should they change the design of the platform to reduce discrimination? If so, how would they decide whether the changes were successful?

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