1. Airbnb and Ebay Are Similar in That Both Companies Run Online Marketplaces That ‘Match’ Buyers with Sellers. How Should Airbnb’s Reputation System Differ from That of Ebay?

1. Airbnb and eBay are similar in that both companies run online marketplaces that ‘match’ buyers with sellers. How should Airbnb’s reputation system differ from that of eBay? Although both Airbnb and eBay provide online marketplaces to match buyers and sellers, Airbnb focuses on one specific area: online marketplace for accommodations whereas eBay runs online marketplaces in a much broader scope, from Fashion items electronics all the way to collectibles, in other words, the transactions happening on eBay everyday are related to almost every corner of our daily life.

More specifically, Airbnb’s customer base can be narrowed down to hosts (sellers) and guests (buyers) respectively while eBay serves everyone who performs online transactions. Also, in many cases eBay transactions occurred when the buyers purchased concrete merchandises from the sellers while Airbnb marketplaces are for virtual services accommodations. A lot of details can be put in place to describe concrete merchandises but it is much harder to do so for service like “virtual” commodities.

The most direct impact of such differences regarding to the reputation system is that we need to take into account the special needs of Airbnb’s special customer base in addition to what hold true to both eBay and Airbnb customers in general: people who perform online buying and selling. Some of the issues mentioned in the 2011 paper may have been fixed but the below statements are based on the description of 2011 paper for Airbnb. 1. When it comes to accommodations, we know the guest wants to know if the room the host posted satisfies his/her needs.

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This will increase the operational cost for Airbnb but will help the guests gain much greater confidence on the prospective accommodations. On the other hand, the hosts are also eager to make sure the guests will behave appropriately while they stay in the hosts’ properties. In addition to the past records of stays that the guests have made in Airbnb, Airbnb can also work with partners (such as travel agencies, hotel chains, credit history investigation agencies) to get more information about the guests.

Airbnb can also hold certain amount of money during the stay of the guest and release the money if the host confirms no damage happened or such. In fact, keeping the house/apartment in good condition should be one of the standard feedback items that the host can provide to the guest. 2. To make the reputation system works better, the feedback on both hosts and guests should be standardized (the feedback providers are certainly welcome to provide additional comments though) rather than free-formed so that more objective evaluation can be made. . An award and penalty process can be integrated into the reputation system so “good” hosts and guests will be awarded (e. g. paying less Airbnb fees or cash rewards) and “bad” ones will be penalized (e. g. paying more Airbnb fees all the way to terminate accounts). This additional incentive can help motivate both hosts and guests do better whenever they can. 4. Airbnb needs to provide a worry free evaluation process for both hosts and guests.

Specifically, the hosts hesitate to give negative feedbacks to the guests as the guests may in turn provide negative feedbacks to the hosts as well. The same applies when the guests are providing feedbacks to the hosts. Some technical way can prevent this from happening. For example, a guest can only see the feedback from the host after the guest successfully submitted his/her feedback to the same host.

In summary, instead of completing the transaction right after the buyer paid the money, the Airbnb transaction should last during the whole course from the time a guest submits the accommodation request to the time the feedbacks from both hosts and guests have been submitted and approved. Such long-living transaction essence should be reflected in the reputation system so that each stage of the transaction is well defined and well evaluated. The reputation system can become more reliable if the aforementioned steps are implemented.

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