Wanna start a rental business with no more extensive investment? Look at this rental business model canvas for your startup insights.
Just create a platform for the renters and the product owners, like Airbnb.
Airbnb is an online rental platform, launched in the year 2008, it is like a hotel chain without any properties. Now, emerged as the world’s top online medium for connecting travelers and property owners.
The triumph of Airbnb’s business model is a significant reason for the revolution attired in the rental industry. Airbnb has a resource-light cost structure, that gives the best way for the renters to catch their needs, and similarly for the owners to earn from their idle properties.
Every firm has a unique business model to reach its potential consumers. Similarly, Airbnb focused on every point of the primary fortes and acquired this success.
Suppose you are looking to begin a rental platform for dynamic products like cars, boats, etc. Precisely, look on the Airbnb for X business model Canva.
Summary
The business model canvas of Airbnb for X consists of 9 categories. The left side of the model consists of the supply side from the business viewpoint. And the right side is purely for customers.
- Value Proposition
- Key Partners
- Key Activities
- Key Resources
- Customer Segments
- Channels
- Customer Relationships
- Revenue
- Cost Structure
Let’s dive to gain in-depth knowledge about the above-summarized elements.
1. Value Proposition- What’s Your Rental Platform Value Offerings?
In the rental business model, you need to provide the platform with equal value propositions to both key partners.
That is create =value for the supply (hosts or owners) and =value for the demand side(guests or renters)
In Airbnb for X business type, the value is provided between the three sides of the platform, asunder from the economic value.
Your platform should give a distinct experience affordably to both the renters and owners. The three pinpoints to complete in your rental business platforms are,
Individual Connections: Your platform should give a private connection to the renters and the owners, to know exclusively about the product’s quality, price, etc.
Community: Your platform would be a bigger base for many users such as hosts and guests, which will create a great community and a marketplace for rentals.
Localization: Increased amount of information for the people searching products with images and with multiple choices.
Value Proposition For the guests or renters
You can offer unique stay or product renting experiences to the usual renters at the lowest prices than renting directly or better than hotels.
Airbnb, like a rental model, gives the user a better choice and variety as per their requirements. Also cost-effectively provides easy booking convenience.
Make your rental business model a destination for authentic rental items, which can be any from cars to equipment, your business should experience the users with explicit points.
Value Proposition For Rental Owners
The primary value proposition for owners of Airbnb for X rental business model is revenue generation. Higher-income through the long rental period. And extra income at some convenience.
Easy joining platform.
The comfort of getting the id-checked renters. And have the ability to see the guest’s ratings.
One of the big measures from the hosts or rental owners is about risks.
Risk minimization of the rental products plays a key value in the owner proposition concern. It includes matters like insurance, and the need to ensure the product is in the good condition as rented earlier.
Easy Management options for the item owners, in managing the rental bookings, listings, availability calendar, etc.
Key Partners-Who Are Your Major Fund Partners?
Key partners are the viral part of your platform. In the rental business model, the owners or hosts and the super hosts are the crucial partners who are going to give your supply and demand part.
- The product owners will list their properties or items in your platform which gives supplies to the renter’s demand. Their supplies would provide many combinations to the users in picking their rental requirements.
The rental business has two types of host partners,
- Property or item owners furnish their idle houses, boats, cars, or other rental equipment to the consumers.
- Event hosts or guides are the people with the rental consumers to guide the locality, food, culture, etc.
- Investors-your rental marketplace would hold multiple investors for the initial funding of the business. This funding could be from technical app development to acquiring the right customers via exemplary advertisements. These funding rounds of your rental business will continue until the platform becomes highly profitable.
- Other key partners would be a part of your rental marketplace: product handlers, delivery partners, associates, travel and commercial partners, etc.
Non-Key Partners
Airbnb, like the rental business model, has multiple non-key partners. The people who are functioning essentially for the consumers during their rental duration are considered the non-key partners.
For freelance photographers in the vacation, car, or boat rental business, it’s significant to import your platform with the freelance photographer listings. Memories at the moment are the most desirable ones for people who are looking to collect their images professionally. Your revenue could increase with the selection of freelance photographers from your marketplace.
Software partners- Some of the important software partners for the rental marketplace are Map service providers, Payment platforms, Cloud storage providers, and other technology needs, etc.
Key Activities-What Are Your Key Roles To Do?
Analyzing the key roles would boost your business plan on what you should do to make your business distinct.
Your rental platform key activities would be in the form of three types,
- Technical Operations superiority
- Focusing on expanding the renters and owners
- Keep analyzing the existing value propositions to overcome the new trendy metiers.
Certainly, your key activities would revolve entirely to enhancing the positive ones and resolving the negative ones.
Key Resources-What Is Your Key Resource?
Your business proposal is with the online mode, hence your rental business key resource is with the network effects. Significantly, the data, algorithm and the capability of analyzing the insights of users’ data are the essential parts that your core resource would carry on.
In addition, Airbnb’s key resources are here, which can similarly apply to your rental business model.
Digital Platform
The Airbnb digital platform serves as the core resource that connects hosts and guests worldwide.
Technology Infrastructure
It includes servers, databases, software systems, and algorithms that power the Airbnb platform.
Brand And Reputation
It is a valuable resource by Airbnb, that has been built through years of delivering quality experiences and gaining user trust. Similarly, building the brand and reputation for your rental startup will build soon based on your quality standards.
Data And Analytics
Your rental platform collects and analyzes large amounts of data on user behavior, preferences, and market trends.
Customer Support And Service
Providing customer support and service channels to address inquiries, resolve issues, and ensure positive user experiences.
Among all, brand recognition, technology, and customer relationships are playing a big resource in the rental business models. These parts will diminish your positive network effects crucially. Enhancing these will reduce negative cores and make the platform efficient with a higher-end user experience.
Customer, Segments-Who Are Your Audience?
The online rental business is a multi-sided platform. Segmenting the customers based on the business will help you to market your brand and reputation. You should segment the customers on both sides of supply and demand.
This segmentation would answer all your business questions like who are your target consumers, what is your target location, etc.
Segmentation of Renters
- Location-based demographic
- Search behaviors and previous purchase experience
- By age, income bracket, interests, etc.
Segmentation of Owners
- Based on the rental products
- Long-term rentals or short-term
- Additional offers for the renters from owners
- Location type and features
- geo-demographic
Channels-What Are Your Promoting Ways?
Marketing channels are vital to reaching potential consumers. Possible marketing mediums for the rental business,
- Social media
- Promoting via sponsors
- Digital marketing campaigns
- Referrals
- Content marketing
- Word of mouth
- Free media coverage
Channels For Daily Traffic Conversions
Your transactions will be fully automated via the app and web pages
You can use push notifications with compelling content that grab users to fetch on your rental marketplace like special offers/reminders.
Customer Relationships Should Your CRM?
One of the significant parts that your business plan should go to is CUSTOMER RELATIONSHIP. Failing to manage and accomplish queries from consumers will lead to a bad reputation for your business.
Important factors to keep a genuine CRM in the rental business model,
For Renters
- Satisfaction about the rental experience
- Care to give personalized rental products
- Instant customer support(effective communication between renter and product owner)
- Providing on-time attention to carry their issue details
- Drive to move with positive reviews
- Liaise with cities, regulators, and other communities that required in your rental business
- Security and privacy
For Guests
- The product owner must take responsibility for the rental experience
- Foster loyalty
- Security and privacy
- Take responsibility for the bad behaviors and risks from both sides.
- Keep the product listings with updated live images
Managing your Customer relationship will bring you the brand name and help to influence the business via word of mouth.
Revenues-What Are The Revenue Generation Ways?
In an Airbnb-like business model, you can make revenue by charging the renters and owners through the platform service fee. Every successful sale transaction from the stakeholders will yield your revenue.
Renter Fee: A rental user could pay you highly for acquiring the rental product via the platform. It can range from 5-15%.
Owner Fee: For listings and getting rental people, owners could pay you 3-5% of the amount from the whole rental cost.
The percentage could differ based on the supply and demand of your rental business sector.
Apart from this, you can earn revenue from,
- The subscription fee (while users looking to unlock for the innovative features)
- Surge fee (during the festival or based on seasons)’
- Advertisement fee (by the promotions from third parties)
- Affiliate programs
And you should also allocate your costs directly to the customers, for the operations.
Cost Structure-What’s The General Cost Structure Of a Rental Business?
To put it briefly, the rental business model costs involve the following segments,
Revenue cost-Insurance premium, payment fees, IT costs for ongoing operations.
Product development development, designs, platform enhancement like maintenance, updates, and other R&D costs.
Sales And Marketing-Advertisement fee offers that provide for marketing include discounts, coupons, referral fees, refunds, etc.
Administration-legal fee, professional services, cost for administration department. Etc.
Restructuring costs– the cost that needs to renovate your entire rental business after a break, which is similarly caused after the period of a pandemic.
Sum Up
The overhead business model will suit all the rental business types, hence it is called the Airbnb For X rental business model. Utilize this efficient business model for structuring your rental startup. And, explore your thoughts in detail on every 9 attributes, that assist in enhancing your business probably.
