Airbnb’s website redesign is more than just revamp, Nick Zarb, director at Simon-Kucher & Partners, explains how the brand got smart with data and what B2B marketers can learn from their success
Airbnb recently unveiled a comprehensive redesign that is garnering a lot of attention. But there’s much more to it than a new logo, the new approach will help them close more deals, upsell more successfully and grow their profits more quickly – and provides plenty for B2B marketers to learn from.
Airbnb are getting smart with their data allowing the brand to focus on who you are and what you need. The more they know about you, the more customised recommended property listings will be, with priority given to rentals that fit your needs and crucially, your willingness to pay.
This is essentially a needs-based segmentation and allows Airbnb to move from an undifferentiated marketing approach to a targeted marketing approach. Needs-based segmentation means companies can differentiate along, for example, promotions, products and services offered, communication methods and channels used, and crucially, price. The brand will eventually move to a model where every consumer is allocated a ‘segment’ and shown offers and services that most likely reflect their needs (based on what other, similar, customers need). This will help with acquisition, churn and total spend, as the experience and marketing improves to serve these needs.
Implementing customer segmentation
B2B companies can implement a similar form of segmentation by mining details such as transactional data, internal expertise, customer survey data and then establishing needs based segments which they then can differentiate (or create) propositions for.
Frequently in the B2B world I find these segments fall broadly into high service or product quality versus low price segments, but other statistically distinct customer segments may arise that help you better serve your markets.
A good segmentation, which Airbnb is clearly striving towards, has the following characteristics:
- It describes homogenous groups that want and need different things, meaning they don’t just look different but act differently.
- It can be measured, quantified and acted upon, so targets can be identified and reached.
- It will achieve organisational acceptance and form the basis of all marketing and product investment decision. Airbnb will be using their data to ‘prove’ their differentiated marketing approach.
- It will generate higher returns than the cost of differentiating and managing them.
- It tends to be ‘obvious’, or at least starts quite simple because to be useful it has to be usable. Airbnb may start with: ‘people living in rich areas like skiing’, for example.
- It focuses on the money, that is to say where changing something leads to upsides.
Airbnb will spend time and money refining their segmentation to enable them to better predict customers’ likely needs. They may even have distinct segmentations based on lifecycle – acquisition (based on demographics, for example), current (based on behaviour) and retention (based on spend differentiation).
So the key question for B2B marketers is: how much do you know about our customers and what they need? You don’t have an actionable, useable segmentation if you’re not able to differentiate your marketing approach. But you don’t need as much data as Airbnb to get started with customer segmentation.
