Why does your hotel business need an on-demand hospitality service app like Airbnb?

Why does your hotel business need an on-demand hospitality service app like Airbnb?

Airbnb is a virtual community marketplace that connects travelers with hospitality service providers (hosts) around the world to find a home-like place in foreign places.

Headquartered in San Francisco, California, Airbnb accommodates the widest variety of over 4.5 million unique hostelries from 191 countries across the globe listed in its app.

Airbnb today has come a long way since AirBed and Breakfast and become a $100 billion company by providing services than traditional hotel businesses. Let’s see how:

All you need to know about Airbnb’s business model & value proposition:

Airbnb runs as an aggregator business model, just like Grubhub, OYO, and Uber, where the key components in the process are the guests and property owners.

Earlier, the Airbnb website was the only platform to connect hosts renting out space with guests seeking those spaces, but now it has both an app and a website.

Since the Airbnb business model deals in the physical living spaces, Airbnb hires freelance photographers to click high definition pictures of the property.

Hence, the guests can see the place before bookings. Unlike big hotels, Airbnb offers lodging at generally cheaper rates.

Let’s try to understand the role of these 3 associates in the Airbnb business model in detail.


Hosts are the people who own a property and want to lease/rent them. Airbnb provides insurance to the hosts on their listed houses.

Hosts can list their spare properties on the Airbnb website along with the facilities they will provide, including the rent, check-in/check-out time, WiFi, meals, number of bedrooms, etc.

Hosts have the liberty to choose who can stay at their places by reading the reviews from other hosts and accept or reject the travelers’ requests accordingly.

If the host approves the traveler’s stay-request then they have to make the payment in advance, and once the stay is over, the host receives the rent amount, deducting the commission fee by Airbnb.


Airbnb offers numerous lodging options to travelers who want to stay comfortably at affordable prices, with an in-app chat facility to connect directly with the hosts.

Also, travelers can use the various search filters as per their needs (rent amount range, basic amenities, number of guests, etc.) in the app to find the right place.

Travelers then can finalize the place by choosing the dates to stay and making payments online under the secure payment gateways.

Just like hosts, travelers have the option to rate the stay and give their feedback in the app.

The whole process of booking a place through Airbnb is said to be the most hassle-free, secure, and usually cheaper, which is great for travelers on a budget.


Airbnb has a wide network of freelance photographers across the globe, to take high-quality photos of the places listed by the hosts. These photographers are directly paid from the Airbnb portal.

The photographs of the place get uploaded on the website by Airbnb, which lets the guests make the right choice by looking at the real-time pictures.

Revenue models for an app like Airbnb:

The revenue model of Airbnb runs majorly on the fees charged on the listings of places and stays by guests.

Airbnb charges around 3 to 4% of the transaction fees from the hosts and around 6 to 12% of the transaction fees from the guests on every confirmed booking.

These rates vary depending on the size of the booking made, including cleaning fees, currency exchange charges, extra guest fees, occupancy, service fees, etc.

Future opportunities in the hotels-on-demand industry:

Traveling across the borders always thrills most people around the world, until they start planning and working out on them.

Yes, rolling out bookings for our trip is a very challenging task. Because we have to explore dozens of apps to get the best deals on hotel booking.

However, with the launch of highly feature-rich on-demand travel apps like Airbnb, booking homestay for traveling has become far more comfortable and economical, as they offer on-touch bookings for all services.

According to Statista, the number of 43.3 million users in 2020 from all across the world are using Airbnb, which is expected to reach 45.6 million by 2022.

In the emerging era of technology, investing in developing the fastest growing property rental booking apps like Airbnb, is a worthy decision to invest for startups and entrepreneurs.

To stay ahead in the market and give strong competition to the existing players you can offer some advanced features in your tech solution. Such as:

In addition to the traditional accommodation types like the entire home, private room, and shared space, you can offer your users unique types of home for every occasion.

For example, vacation homes, unique corporate lodging, boutiques, social gatherings, weddings, honeymoons, etc.

You can also offer more authentic service by accommodating hosts and guests, only after verification. This way, you can make sure that they are getting what they entered on.

How Coruscate can help you:

As we all know building a startup is hard, building a tech startup is even harder.

No matter what service you are offering, you need impeccable technology to make your app performant, and your customers satisfied.

Coruscate is a full-stack software development company with all the expertise you need to build a scalable tech solution.

With a team of 600+ in-house tech experts, we help you in full-cycle product development with post-release product support.

Each app we develop is a full-fledged experience. We follow a streamlined agile methodology that ensures a smooth and reliable association for the development of your travel apps like Airbnb.

We are early adopters in this changing landscape of doing business utilizing disruptive technologies. 

Discover more about our robust on-demand mobile app solutions!

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