Airbnb on their big new innovation, in-housing creativity and brand led communication - Hiroki Asai

0:28Ladies and gentlemen, welcome back to Uncensored CMO. Thank you. Thank you. Happy to be here. Thanks for inviting me. It's wonderful to have you. And I've recently discovered we have a passion in common, which might surprise people listening and watching, but we're both skateboarders. Yeah. Yeah. Recovering skateboarders. Recovering skateboarders, yeah. I'd like to say, yeah. Yeah. I grew up in Cupertino, California, which at the time, the late 80s was when I grew up. Thrasher Magazine and Bones Brigade was kind of the only, I mean, this was, you know, before we had the internet, well, you know, yeah, it was exciting.

1:00It was dangerous. It was different. And so it was a big passion of mine when I was a kid. It was quite a scene, wasn't it? And it's nice that even Tony Hawk is like now an investor in brands like Liquid Death. So, you know, it's like. Yeah, yeah. Things have changed. Skateparks are everywhere. And yeah, it's quite different now. Am I right to say you've even got a skate park in your house as well? Yeah, it's a ramp, a skate ramp. It's a modest skateboard ramp in our house. but it was when we were remodeling it it was actually my wife's idea to be honest my wife came up with it she said you know you why don't you just like reserve a room for a half pipe for you and the kids and I was like oh my god that's why I married you you're brilliant that is genius yeah I think that's the ideal uh ideal brief yeah one day but tell me the story about how you ended up uh arriving at Airbnb because you joined at quite an interesting time in kind of the brand's evolution, didn't you?

1:51Yeah, yeah. I started there at the end of 2019. And we were just hearing about this thing happening over in China. It wasn't like, you know, a little bit scary, but not major news yet. And then yeah, I believe it was March of 2020. You know, right after I joined was when the pandemic hit. And, you know, all hell kind of broke loose. And it was, you know, as Brian said, it was 80 % of the business got lost in just a matter of weeks. Wow, it's pretty crazy. What did you do in that time? I mean, I presume you didn't know how quickly a recovery would happen, when it was going to happen. No, no, it was just all hands on deck to really, you know, try and figure out how to keep the company afloat, what parts of the company would be left.

2:34But it was also, you know, a time to really kind of go back to the core of what Airbnb was about and the core of its business and rebuild it after that. Now, one of the sort of famous, you know, lessons from that time that I know lots of marketers listening will kind of refer to was that you turned off a lot of your performance marketing channels, didn't you? But you kept investing in the brand even without anything necessary to sell. Yes. How did that work? What's interesting is, you know, with the pandemic, we had to suspend all spend basically. And marketing is, of course, gets cut. But and, you know, how often do you get to do that experiment where you completely cut off all your performance marketing just to see what happens?

3:15Yeah. And so we were kind of forced there, cut off all the performance marketing and the majority of our organic traffic remained. And so it was a big sign to us that that we can take a different approach. And, you know, Airbnb at the time wasn't investing in brand. It was predominantly performance. And so I think one of the biggest problems was that it was not in control of its own narrative. and it did not have the opportunity to tell its own story. So, you know, it was largely being run and told by the press. And a lot of the work, the messaging was really reactive to what was happening. And so, yeah, brand was the opportunity to really, you know, remind people what Airbnb was about and really remind people what authentic travel could look like.

4:01Now, talking of story, I hadn't actually heard Brian tell the origin story until today, actually, which is, would you mind saying it? Because it's really quite fascinating. Sure. It almost links in to some of the news you've got. Yeah, yeah, yeah. You know, it definitely predates me. But it was, you know, he and his roommate from art school actually had trouble paying rent. And there was a design conference in town. And so they decided, hey, why don't we, you know, rent out the rooms in their apartment, which they did. And they had three designers join them. And, you know, what's kind of interesting is, it was the original concept of Airbnb to, you know, to have these people come and stay.

4:41But also, they spent a lot of time running around the city, showing them the city, taking them to the mission to get tacos and doing all this stuff, which is actually kind of about experiences. It's actually the birthplace of experiences. So the original Airbnb was about a place to stay, but also things to do in San Francisco. Yeah. And there's a lovely phrase you use as well, which was the people came as strangers, but they left as friends. Yes. Which is a lovely kind of insight into humanity, isn't it? Those experiences we have when we meet, we travel and we discover people that we've got a connection with.

5:11And, you know, we share those experiences. Yeah. That's what's so, you know, amazing about Airbnb is it's it's it's not a company where you're creating a product that's a tool. You're actually putting people in other people's homes, you know. And so you're dealing with humans and humans together, you know, and the magic that happens from it. And it's so much closer to humanity and the human experience than most companies. It's a very, it's a very, I think another quote he was talking about was 99 % of people on the planet are good, aren't they? And it's, we read so much negativity on social media where our feeds are full of bad stories.

5:48But you travel, you meet people, it really restores your faith in humanity and how lovely everybody is. Yeah. I mean, you know, travel, I think it's one of the most optimistic and it's one of the most aspirational things you could do. It's like, you know, when people say they're going to retire, what are you going to do? I'm going to travel. You know, if you win the lottery, what are you going to do? I'm going to travel. You know, everyone like loves to try. I think it's when you're at your best. It's when you're at your most open minded. You know, it's when you're at your most friendliest. You know, you have, you know, if you ever made friends and travel when you're traveling, those friends kind of tend to be, you know, stick around for years and years.

6:22And so I think, you know, people are at their best and most open when they travel. And so I think the connection that happens there is magical. Now, something I associate certainly with using Airbnb and the communication you do is the beauty of the design and the integrity of the design, which is, you know, it's quite a lovely aesthetic and quite a pleasing aesthetic. How important is design, you know, to the brand? Oh, super important. I mean, it's deep in the DNA because two of the three founders met in design school and did study design. And so we're really lucky that we have a CEO, founder, leader like Brian, who is definitely a right-brained thinker.

7:01And so he definitely understands the value of design and creativity. And so that works its way into the DNA of the whole company. But for us, the way I think about it is design is very much the design of the app, the design of the graphic design and things that we do. But it's also in the way that we think and approach problems. And it's also even goes down to the way that we design the operating model of how we make things and how we bring things to market. And so we're very intentional about our organizational structure, our calendar and how we operate and the interaction of the teams to design those things to make what we make.

7:38Yeah. Now, do you design everything in-house? That's one of the things I was curious about. Yeah, and I'm super passionate about this is that I really, really truly believe that having everything in-house is the best way to do it. And so we have all of our advertising is done in-house. The marketing is, of course, done in-house. All of the design work is done in-house. The product design work is done in-house. Product marketing is all in-house as well. And I think the benefits of it is, you know, and we're also highly, highly collaborative. And so you have the advertising creative team sitting right next to the product design team, sitting right next to the engineering teams.

8:14And so ideas can flow horizontally really, really easily. I mean, and a great example of this is when we started with Airbnb Originals in designing these things. what we wanted to do the goal the mission was to understand the most authentic the most authentic way to communicate 135 different cities around the world right like how do we bring forward the most authentic versions of those cities and so we talked to writers and curators and and artists and all those cities and came up with this concept of let's let's narrow it down to three principles for every single city and we took those three principles and that informed the types of chefs that we got in the city, the types of writers that we got, the types of tours that you get, the types of galleries that we leaned into, the most interesting hosts in those cities.

9:03That brief also went and informed the way that we approached the advertising. And so you had the design team that was designing the experiences and going out and finding these things in these cities, working really close with the advertising team. So the advertising teams could really understand why, what was so special about this chef that was making ramen or this you know this person in peru walking you through some historical monuments and so you know that that connection is really really critical to the way we do our work i really like that because i think for so many marketers that they feel like they're stuck in this silo often at the end of the process yeah which is like the product's been made it's all been agreed the price has been set everything's fixed yeah and you've got to go out and somehow sell it yeah Or they go, I wish we could change this, you know, because often the marketers are the ones close to the customer, aren't they?

9:51Because they're spending their time understanding the customer and so on. So the fact that you can be so well connected gives you a massive influence, doesn't it? It does. It does. Yeah. And, you know, even I mean, we call it concurrent design rather than serial, where it is everything is kind of happening all at once. And it's more about like thinking about the entire chain all at once. And so when you're thinking about product feature, the design of it, you really are also thinking about how you market it or even how you explain it on a keynote slide. Because, you know, usually if you can't explain a feature in a keynote slide, it's probably going to be far too complicated to use or to understand when it's in the app.

10:29So I think, you know, our creatives and our designers think concurrently. And so they think about the beginning and the end at the same time, the customer and our development process at the same time. Yeah. As you came through in the speech today, because the simplicity of the execution, the way everything synchronizes together was just, you know, felt very obvious. And yeah. And I think the big benefit of it is it's just very easy to understand for someone, for a customer, you know, for someone that's on the receiving end of this. It's very easy to comprehend. It's very easy to understand. And it's very easy to use, you know.

11:06And I think, but it's not easy to make. It's like really, really difficult to get there because you're, you know, you're working through a lot of problems simultaneously. You're questioning everything all the way up until the end. But the goal and the benefit is that, you know, this thing that comes out the other end is just very easy to understand. I think there's a truth in life, isn't there? That the simpler things appear, the harder work was required to get it to that point, isn't it? Exactly. Yeah. Yeah, it's much easier to add. Making it complicated is easy. Yeah, yeah. It's like a classic design thing.

11:39It's much easier to add to the story and make it bigger and bigger and bigger and flourish it more and more colorful. It's extremely hard to try and narrow it down into one thing. It's like designing a logo versus making a film. It's just very difficult to try and get the essence of something into the most minimal amount of moves as possible. That reduction is really painful. It is, isn't it? It's really painful. Now, the big news, of course, is you've been, you know, you're very famous, well known for, you know, being an accommodation provider, shall we call it. But now you're stretching from accommodation into experiences and services.

12:11So tell me a bit about what was the idea behind expanding Airbnb into those two sectors? Yeah, I don't know if it's as much about expanding from accommodations. It's more about this concept of us replanting the flag and what we're about. Because I think, to your point, the founding story wasn't an accommodation story. It was a magical trip. So those three people came. They met strangers. They did stuff together. They were all very open-minded and willing to connect. And they did. And they formed lifelong relationships afterwards. And that was more than just about the place to stay. It was the activities that they did.

12:49And so experiences and services and stays all together is really about replanting the flag. It's about regrasping that idea that Airbnb is about the trip. Now, what kind of services are we talking about here? I mean, can I go to the gym? Can I get a massage? What sort of things would be possible? It's amazing. Yeah, it's amazing. We're starting with 10 categories with many more to come. But we've got like chefs. We've got masseuses. We've got trainers. We've got people to do hair and makeup. And so it's basically all of the types of services that people thought were only available in a hotel. Because Airbnb, when you think about traveling on Airbnb versus traveling in a hotel, traveling in Airbnb is so much better.

13:35I've got my wife and I have three boys. And it's like good luck trying to find an adjoining room in any hotel. And so what ends up happening is we end up being split up. You know, with three boys, there's no way I'm going to put them in their own hotel room down the hall. It's bananas. And so, you know, with Airbnb, it's great. We can all be together. We've got a living room. We've got a kitchen. We don't have to, like, eat on the bed. You know, we don't have to go to bed when the youngest goes to bed. So it's much, much easier. But hotels still do have this convenience of services. But, you know, now that we have services, then actually at a much better value, it kind of makes airbnbs you know hands down no-brainer solution yeah for travel it really does i mean i have the same conversation as well with my wife which is we know we'll go and stay on airbnb but then she goes but then i have to cook you know it's a first reaction well if we can overcome that one yeah yeah and it's great you know because even if like you like to go out to eat a lot there's that one night in the middle of the trip where you're like oh let's just be at home yeah let's like let the kids eat in pajamas let's just chill out on the couch and let's just have some downtime yeah you know and services are great you know and a lot of these services are under 50 bucks a person and so they're a great value as well and of course holidays or vacation are all about making memories aren't they and so you have a photographer or have a you know someone come and do a fitness class for you that you know the imagination the other thing I suppose that also helps this is planning a holiday is quite a big ordeal, isn't it?

15:04Yeah. Because you're going somewhere often you don't know. Yeah. You're Googling all sorts of different local suppliers. Yes. You don't know if they're going to be any good or not. Yes. So you're having to check them out on TripAdvisor. Exactly. There's a whole lot of research that goes in. And if you don't speak the language, good luck. Yeah. Well, yeah, even more so. Yeah. Yeah. So the convenience element struck me as quite powerful. Yeah, it's really convenient. One of the things that we designed into the app also is that, you know, there is this journey of travel planning, right? And you first dream about traveling and then you actually have to plan it and then you book it and then you take a break from all of that and then you travel, right?

15:39And there's a satisfaction curve that's like this. It starts really high at dreaming. You're in love. The world seems great. Traveling seems awesome. And then you're planning and it gets, you know, it's a little bit of work. It's kind of hard. and then you're booking and booking is terrible because you're like spending. Everyone hates booking the trip because it's terrible. You spend a lot of money, you make a commitment so much so that you take a break and then you're actually traveling again. Now, Airbnb used to occupy that center section, the most painful section, right? And so the app was kind of designed to make it really simple, quick and frictionless, right?

16:12To get you out of the pain. Now with services and experiences, like you said, a lot of people book those things on the trip a few days before or a few days during. And so we designed the app to actually change and offer you experience and services when you're traveling, because we know when you're traveling, we know the date that you're book, you're checking in, and we know how long you're staying. And so we can notify you when you arrive in Tokyo and say, Hey, welcome to Tokyo. You know, we've got three things happening tonight with availability, you know, come check it out. Yeah, it's really cool.

16:43The level of personalization struck me as well. You had a great example of a trip to Paris and somebody was able to book a tour of the Notre Dame, but with somebody that actually had a hand in redesigning the roof after the fire. That's a level of kind of tailor making that you just wouldn't get if you just looked at a city tour of Notre Dame on Google. Yeah, and that's really kudos to the curation teams that went into Paris. And, you know, they research the Eiffel Tower, they research the places that people save up all year to go see, like Notre Dame and Paris. But, you know, rather than offering just the plain old commodity tour of those things, they wanted to offer something that's way deeper and unique and something that even a local would find interesting.

17:27And so, yeah, Axel, who's the host of the Notre Dame thing, was part of the restoration, gives an unbelievable tour and explanation of the renovation. It's amazing. And of course, we've been talking about the guest experience, but of course the flip of that is the host experience, isn't it? Because suddenly now you're opening up a new economy of people that can then sort of effectively monetize their own time and their own expertise. Yeah, and it's great because that money stays in the community. You know, it's like we were just speaking earlier. There's just been this rise in, you know, all-inclusive resorts where you go.

18:01And the idea is you basically keep the guests captive. You get their accommodation dollars. You get their, you know, food and drink dollars. And you get their entertainment dollars. But it makes so much more sense and it's so much more healthier for a community if you can go in and the money stays in the pockets of the homeowners. It stays in the pockets of the service providers that live there. and stays in the pockets of the experienced hosts that live there. Much better that the money stays in that community than going back overseas to a big chain or conglomerate. Yeah, yeah. No, that's very exciting.

18:29I mean, so hopefully you'll be able to boost the economy of quite a few destinations off the back of this. Fingers crossed. Yeah, which would be amazing. I mean, one thing that struck me was the sheer logistics of pulling this off. I mean, I don't know how much you can share about what went into it, but you were talking about 600 or more cities that are now doing services and experience around the world. what goes into kind of putting this organization together? Yeah, that's where, you know, kind of the design of the process, I think, comes into place, where we really were intentional about sitting down and saying, OK, there's, you know, all of these cities in the world.

19:02What is Airbnb's point of view with these things? How do we design a process that brings out, you know, some principles that that help us show Paris in the way that we think Paris should be seen and the way that, you know, locals that live there want it to be seen. And so it's really kudos to the team to go into each of these cities, identify the principles and what makes these things unique, and then go in and, you know, search like on foot, you know, people to people and find these incredible hosts, you know, and track them down and design the experiences with them. And then actually, you know, load them into the software, build the software to do it and then and bring it to life.

19:42It's a it was a big operation. I bet. Yeah, we've been working on it for a long time. It strikes me, actually, in the age of AI, that's an extremely human thing to do, isn't it? To sort of go and discover these local undiscovered kind of experts that know the area in different fields. That's kind of what people desire, isn't it? Yeah. It's that authentic experience. Completely. And, you know, like a lot of these experienced hosts that are originals, they don't do this for a living. You know, they have other lives and they do things of note that are really fascinating. And so we worked with them to actually design the run of show of these experiences.

20:16And, you know, we know like how long these things should be, how to greet people, how to how to get them to talk to each other and connect and how to, you know, how to how to do a fond farewell and how to get them to connect afterwards. And so we brought all of that expertise together with these incredibly talented locals to hand design all of these experiences. And some of them are quite wild, right? Right. So even I think I was saying you could even go and have ramen with Megan Thee Stallion. Yeah. I was not expecting that. Yeah. Yeah. There's some fun ones. Yeah. Or throw a spiral with Patrick Mahomes.

20:51Yeah. Yeah. There's there's some there's some fun ones. It's great. You know, it's it's a lot of the hosts that we work with, I think, find the idea of this. A great platform to connect with their fans or audiences in real life, you know. And so we've had a lot of interests from a lot of our hosts that have huge social media followings that want a different way to connect with their fans, create content, but also connect with their fans. But again, it just goes back to this idea that we're connecting people in real life, celebrating what's unique about destinations and celebrating what's unique about the world.

21:29Yeah. Now, this is presumably meant quite a lot of reengineering of the app itself, doesn't it? Because you're now offering three, I guess, services rather than one. What's been involved in rethinking and redesigning the app? Yeah, it's been a huge amount of work. It's been really kind of years in the making. You know, last year we launched Icons and that was really creating a lot of the technical foundation to do what we're doing today in Airbnb Originals. And so, you know, it's one example of a million of the amount of engineering and rewriting deep, deep, deep at the platform level that's had to happen in the past couple of years.

22:03But, you know, all of this since the pandemic has been about building a platform capable of expanding like this. And so I think what you're seeing today with these two new lines of business is the beginning of a lot more cool things to come. That's very amazing. And is this in-house as well, all the app design and how the platform works? Yes. Yeah. We have an unbelievable app design team that's together with an amazing product marketing team that work really closely together. Our product marketing team is interesting. In a lot of places, you would call this team product management. But our product folks have a really, and this goes back to this idea of concurrent that I talked about, they really understand what we call the outbound, which is the go-to-market side of the business.

22:48And so they understand the nuance of communication and marketing to an audience. They understand the nuance of positioning and of general marketing. And they bring that all back into the way that they conceive of the products. And they're working hand-in-hand with the designers to make that happen. And what's also interesting is they're working hand-in-hand with the engineers. And, you know, if you were to come at Airbnb and sit in a meeting, you probably wouldn't know the difference between a designer, an engineer, and a product marketer. Because they all speak the same language. Call it the three-legged stool.

23:24And are they co-located together as well? Do they work physically in the same place? They do. Yeah. Yeah. I mean, we're we're we're mostly remote. But when we are here, we're all together and we're all talking together. But, you know, it's the this the simultaneous way of working, this concrete way of working. It's it just requires an extreme amount of collaboration, you know, and it requires a very, very open minded approach to working and highly collaborative, you know. So, you know, there is a tax of a lot of meetings and a lot of communication, but I think the benefits of it are worth it. And how do you lead the organization in that scenario?

24:03Because you need everyone to collaborate, work together. It needs to be low ego because you're trying to get things done across function. How do you sort of set up the conditions for that? Yeah, the interesting thing is the one thing that they all have in common is time, right? And so we manage against the time. It sounds really stupid and really simple, but you just manage against a timeline and a roadmap. And it's really easy. You have deadlines. You have milestones. It sounds like a no-brainer, but when you have everyone synced in time across the same deadlines, what happens is the functions that sit next to each other begin to understand what's involved in each other's functions.

24:42And so as they make decisions, they understand the knock-on effects to the organizations that sit alongside them. We call it, there's, you know, we're functional, so we're divided by functions. We have this phrase of the primary team. And so there's the team that you manage. You know, if you're the head of design, you have a whole design team that you manage, and you write their performance reports, and you put them on assignments, you manage them. But the real team that you're working with is your primary team, which are your peers. And so that's that horizontal team that you asked about, the engineer, the product marketer, the designer, the creative.

25:16that primary team of peers sit shoulder to shoulder, understand deeply their timelines, their constraints, what it takes to get stuff done, how their teams operate. And so they know, the creative person knows that when they see something happening over on the product side, and maybe an issue or an opportunity happening with engineering, they know how that's going to affect the positioning of it, the end product, and they can move that much more quickly. you know and that's how like today you saw that massive amount of work across so many different functions land on one day the only way you get there is if that that primary team really deeply understands each other and what's involved yeah i even like the way you call it the primary team isn't it because you realize that that that's what that's what it takes to make the thing actually happen yeah rather than going vertically where it's like yeah we're going to make our bit work yeah and then you know don't care about your bit but actually if you're all lined up like that then you kind of win together, don't you?

26:12Exactly, yeah. We have this phrase called a no-look pass. It's like my favorite move in basketball. It's where you see a guy not even look, and he throws the ball, and the other guy's right there waiting. And so that's what we aspire to when we operate, is that we're so familiar with how this all happens against time, against the timeline, with the same milestones, that you see something happening, and the other team member could kind of be there and catch the ball. And so we very rarely have those instances where it's like, you know, a baseball that's dropped between center and left and everyone's kind of standing there looking, watching it drop.