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The selection process for the market's third operator was a spectacle to behold
As featured in DisruptiveViews
Telcos can learn a lot from digital service providers like AirBnB. Telcos talk of becoming digital, of being more agile and tend to look at companies like AirBnB with a mixture of distant admiration and envy. At a conference session I moderated at MWC last week, the audience came to realise just how important getting the customer experience right actually is.
When it comes to peer-to-peer lodging getting it right means a potentially long and happy relationship. And getting it wrong means instantly losing a customer. “Trust,” according to Mike Curtis, VP of Engineering at AirBnB, “is absolutely the heart of our business.” Under the guidance of Curtis, the engineering team spends huge amounts of time on personalization, communication and improving the matching capabilities of the service.
“Essentially, when you use the service, you are going to stay in a complete stranger’s house,” said Curtis. “Therefore, the way that the initial contact is set up is crucial. And it must be real time. We did a survey a couple of years’ ago which showed that for every hour that a host took to respond to a guest request the booking was 2% less likely to happen. So, we spend a lot of time on the communication piece. The most effective method is push notification, the second is SMS. Customer expectations are being driven by instant delivery and the fact that mobile is overtaking – in fact has already overtaken – how customers want to book and interact.”
Another key focus for AirBnB is personalization. “Each host and each guest are completely unique individuals,” says Curtis. “We spend a lot of time thinking about personalization. Particularly with the rise of mobile, a customer needs to see the top ten listings that are perfect for him, not hundreds of them.”
Once the trust is built, using the available technology to its best advantage, the benefits are huge. According to a recent study by Goldman Sachs, once a customer has successfully used peer-to-peer lodging once, the likelihood of him going back to a traditional hotel halves. “I read the study,” said Curtis, “and it certainly synced with our own experience. What we try for is customers living in a place for a little while, not just visiting. If they have a good relationship with someone who lives in a place, then that sense of community, local knowledge and so on becomes incredibly powerful and leads to a proper relationship.”
Technology is, of course, at the heart of the business but using cloud based tools is a huge advantage for Curtis. “I read that WhatsApp got to 800 million users with 50 engineers. That is incredible. Ten years’ ago, you would need ten times that just to maintain the servers. What this does is allow us to spend a lot of time experimenting, trying to improve communication, personalization and the whole matching experience. There are always dozens, even hundreds of experiments going on at any one time.”
From the point of view of a tech company being agile, providing a personalized service and having the customer as its center of attention, looking at companies like AirBnB can provide great insights for telcos trying to become digital. The more so, perhaps, because if they get it wrong, they lose a customer then and there, if they get it right, then everybody wins.