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How to Build a Website Like Airbnb

How to create a rental marketplace like Airbnb

Creating a successful marketplace business is a real challenge. You need to make it unique, successful, game-changing, and, the main thing, standing out from the crowd. But how does Airbnb stand out from the rest?

This guide aims to help you to answer the questions: “What are the distinctive features of Airbnb?” “What business model does Airbnb implement to make a profit?” “How to build a website like Airbnb?” “How much does it cost to build a website like Airbnb?

Let’s dive in and discover what it takes to create a rental marketplace like Airbnb.

Airbnb's origin story

Airbnb's story started in 2007, when people who were going to attend a design conference faced the lack of hotel rooms in San Francisco. Two roommates Brian Chesky and Joe Gebbia got the idea to earn some extra by offering to host attendees on air mattresses. The idea resulted in the creation of a simple website that let three people stay at Chesky’s and Gebbia’s flats. In a year, one more person, Nathan Blecharczyk, joined the team, and the process of building a more feature-rich solution began.

Airbnb went through an amazing story, from selling breakfast cereal to getting rejected by famous VC firms. It took years of learning and iterating optimization for Airbnb to reach the results the marketplace has now. Today its worth is measured in billions.

Launching a website like Airbnb today is much easier than in 2007 thanks to lots of available e-commerce tools. But the core of Airbnb remains unchanged – the inspiration to provide improvements, development of additional functionality, and implementation of the working monetization strategies.

How does Airbnb's business model work?

There are many different monetization methods popular among marketplaces, and the most appropriate method will depend on the nature of the business and its target market.

Airbnb marketplace lets travelers rent home-like places, where property owners list their homes for visitors for booking vacation rentals. A commission fee is the primary monetization strategy that the marketplace uses. It helps to generate revenue from both hosts and visitors. Property owners pay 3% per transaction, and travelers are charged approximately 6-12% per booking. The property owners can split the fee with the visitors. Therefore, the commission amount of the Airbnb marketplace is fully based on the property value. Such types of hosts like hotels usually have mandatory fees, which comprise 14-16 %. Some hosts with strict cancellation policies and some other host groups may have even higher fees.

Besides, Airbnb is the only rental marketplace platform that provides insurance support for hosts. On the other hand, Airbnb's business model provides insurance services. If a host incurs unexpected loss due to damage or additional cleaning, Airbnb compensates them.

A set of essential Airbnb features

Airbnb offers features that are quite different from those of traditional marketplaces. Here below you may discover the main ones:

Profiles and listings

To operate on Airbnb, users need to register and get an account. Informative, nicely designed profiles and listings are key factors to leave a positive first impression and attract potential guests. Host profiles have a significant influence on the guests’ trust, thus they need to include essential information like reviews, available properties, and so on. By verifying an Airbnb account, users add extra credibility and trust to a listing. There is data that shows that guests are more likely to book stays with hosts who stand out from other listings without any verifications.

A map-based search

Usually, location doesn’t matter for traditional e-commerce marketplaces, as products can be shipped worldwide. But for Airbnb, the situation is quite different. The customer and the provider’s offering need to be physically close to each other.

Therefore, Airbnb needs a powerful search engine to allow users to look for listings in their ideal location. Furthermore, displaying listings on a map is also essential.

Payments

The availability of Airbnb payment methods varies depending on the country. Payment methods available in most countries are:

  • Visa, MasterCard, Amex, JCB, and debit cards (if you can pay with them like a credit card)
  • Apple Pay
  • Google Pay
  • PayPal

All payments are handled by a third-party platform like Stripe. After booking, a portion of the money is sent to the host and another part to the Stripe account as a platform fee. There is a Stripe tax tool that can be easily added to provide automated tax calculations.

Airbnb uses delayed payouts that allow customers to split their payments into two parts and pay the second half later. Delaying payouts ensure that both the providers and the customers of the marketplace make bookings with honest intentions

Booking management

For such a marketplace as Airbnb, providing updated offers, services, or rentals is crucial, therefore providers need a reliable system to specify when their listings are available. After a listing is booked, the information should be updated, so a client would be able to browse and book only relevant listings available during their desired dates. All booked listings should automatically be defined as unavailable for the booking period.

Airbnb's admin tools

A wide range of Airbnb admin tools helps to manage all the processes of daily monitoring and management. The basic admin panel allows admins to send notifications to users, moderate user-generated content like profiles and listings, control user access, see transaction processes, and so on.

Customer reviews

With peer-to-peer marketplaces, trust is a key factor in a platform's success. When establishing a business, first-time customer feedback is crucial and builds trust in the seller. On peer-to-peer marketplaces like Airbnb, vendors also need to create social proof and a sense of trust with real feedback and reviews.

Ways to create a website like Airbnb

When Airbnb started its path, it was the dawn of an online marketplace era. They were a new way of getting money and conducting business. Today things have changed but building a marketplace like Airbnb from scratch continues to be an extremely complicated, time-consuming, and expensive project. But there are some alternatives that don’t demand a lot of time and a huge budget. How much will it cost to build a website like Airbnb? How long does it take to launch it? Let’s answer these questions by looking through the most popular ways of building a website like Airbnb:

Custom development

Custom development of a unique software application will require a heavy budget and a team of professional developers. Such a marketplace is far more complex than an average web application and must be designed uniquely for your goals and needs. How much does it cost to build a website like Airbnb from scratch? There are multiple factors that influence the cost of marketplace development: project complexity (like features you’re going to implement and project characteristics), the number of team members, hidden factors like further maintenance, and more. Even the most cost-efficient choice will likely cost you about $50,000 to launch a website. Furthermore, you will have the costs for hosting and third-party tools.

If you have a team of developers that are skilled enough to launch the frontend and backend parts and are willing to take on the maintenance work, the costs will be limited to hosting and third-party tools. You can either use the Airbnb technology stack or get to work using the technologies your team is skilled in.

Development from scratch takes several months for building the platform itself. However, in the case of hiring a third-party vendor, this time can be much more efficiently spent on creating key unique features and building a user base.

If you're interested in building a marketplace app from scratch with Shopify, we recommend reading our article “How to Create a Marketplace on Shopify Platform: Actionable Tips”.

SaaS for building a marketplace

If you want to launch a business idea faster, there is an alternative way to implement the marketplace by using Software-as-a-service (SaaS) tools like Sharetribe, RocketBazaar, Yo!Kart, CS-Cart, and Shopify. These platforms offer not only a wide range of functionality to choose from at various prices, but also storage on the servers along with thousands of other websites.

By using a SaaS platform for marketplace development, you can launch and run a marketplace entirely without coding. It is the easiest choice in terms of the technical skills required. In addition, you won't need to worry about hosting, maintenance, backups, or updates.

This approach demands a minimum set of developer skills, as you may use ready-made templates. There are non-customizable or customizable templates that will give more freedom to your business. It’s a great choice to validate your idea and find a product-market fit without spending months building your website. However, you will need to scale the product sooner or later and may face some restrictions, as a ready-made tool doesn't give you the same freedom as custom development.

You may use a SaaS tool for validating your marketplace idea and building your minimum viable product. After you launch your site and learn about your audience, you can move on to a more custom-built solution to grow your business.

We recommend an API-based marketplace software solution for the next stage.

Headless marketplace

Headless API-based marketplace software combines the benefits of both custom development and no-code marketplace tools and is a great alternative. It makes possible the production of tailor-made, customizable, API-driven systems that focus on an omnichannel strategy and offer all the essential marketplace features out of the box.

​​The growing flexibility and scalability of headless commerce ​​infrastructure deliver an outstanding customer experience within the new digital economy. It helps to build faster and use mandatory marketplace features that users take for granted. Enterprises can cut time to market and costs by as much as 90% compared to coding a marketplace from scratch.

An API-based architecture allows the development of unique features, and a customer-friendly interface, as the freedom of custom coding is preserved. The developer does not have to start from scratch when creating a new application. It’s possible to provide any changes to the frontend part without affecting the backend. A team of developers can build bespoke e-commerce solutions to achieve business goals faster and without pitfalls. You can use your budget for building great, unique features and taking advantage of the regular updates that headless solutions offer.

Developing your marketplace with DigitalSuits

Through its success, Airbnb shows that only constant learning and improvement can make a marketplace business successful.

The modern Airbnb marketplace platform uses a pretty powerful technology stack and a large number of tools. Hiring a professional team is essential to improve the quality of service for your customers, and to effectively grow your business as a whole. The experienced vendor will ensure that the technology stack is sufficient for your project.

Firstly, you need to focus on a clearly defined target audience and fulfill their needs better than anybody else. Our team advises an MVP, or minimum viable product, approach that encourages the fastest and easiest way to deliver your very first customers a remarkable experience. With a minimum viable product, you get a chance to test a business model and define the core problems in the first stages. By communicating with your first users you can create a unique value proposition that is a great way to reduce time to market and avoid extra costs. Furthermore, an MVP lets you discover necessary tools and develop the required functionality. Every tool has its own degree of complexity, thus rates significantly differ. The MVP approach ensures you won’t spend money on developing functionality that will not be in demand by your consumers.

If you are ready to build a website like Airbnb, send us a message. Our team will assist you in developing your MVP website rapidly and affordably, by providing all the necessary technology stack to make your online marketplace platform scalable, productive, and protected.

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