Airbnb Crisis: PR Has Seen This Before

Another week, another PR crisis. This one comes by way of the Quixotic, pie-in-the-sky Silicon Valley start-up Airbnb, which allows people to rent their apartments, a bedroom or even their living room floor to complete strangers, with little to no background check of that person’s character. Think about how absurd that concept sounds.The crisis in question involved a San Francisco woman, known only as EJ, who blogged that she was the victim of a heinous property crime by a guest who arranged to stay there through Airbnb. In what is being called “#ranscackgate” (sidebar: Another “gate”? Really?), Airbnb has, perhaps not surprisingly, totally flubbed its response.

There’s a lot more to how this has evolved, including allegations that Airbnb executives tried to keep the victim quiet (shades of the News Corp. phone-hacking scandal, perhaps?). Techmeme has all the news.

Before I go on, let me be clear: What happened to EJ and her home is awful. It’s saddening to hear and frustrating from a we’re-all-in-life-together perspective. But it doesn’t surprise me.

Why? Because the concept of taking an eBay marketplace and putting that into real-life situations in which complete strangers rent out your place, with little to no guarantee of what they will do with it while you’re gone is absurd. It gives further credence to those who believe a) we’re on the cusp of another Internet bubble (Airbnb’s week started a lot better after it announced $112 million in funding); and b) that many Web and social media entrepreneurs are getting mega funding for concepts our parents would have told us when we were 5 years old was nonsense.

And just when Airbnb thought things were calming down a bit, Tech Crunch produced a whopper of an exclusive interview over the weekend with a former Airbnb user who says his home was overrun by meth addicts. The laissez faire response from Airbnb to the original complaint, which TC runs in its entirety, is telling of the firm’s mounting PR struggles.

That brings me to two reasons why I think PR pros have been slow to latch onto this story:

Airbnb is still a relatively minor digital service. It has only two million customers, mostly clustered in urban areas where people apparently don’t care enough about their own possessions to not find this idea silly. (I say this as someone who lives in New York City.

We’ve seen this kind of mess before. Last summer, I wrote in Business Insider about the #EpicFail of the equally Quixotic Blippy, which allows people to share their credit-card purchases to followers. In that case, Blippy’s servers went berserk and gave out users’ credit-card info via a variety of Google search terms. As I wrote then, tech firms often act as though no one can touch them. They boast of huge user bases and mega funding rounds, yet all too often, they gloss over the more mundane, but equally important components of running a successful and long-lasting business. Like having a strategic communications plan in place before a crisis hits (which, inevitably, as all business owners know, will happen at some point in a firm’s history).

As Airbnb investor and LinkedIn co-founder Reid Hoffman told the Financial Times last week, “all entrepreneurs have an optimism that means they can change the world on a massive scale.” That’s all well and good, but few customers and investors care much about optimism when the proverbial shit hits the fan, as it now has for Airbnb. So why am I not surprised more PRs haven’t grabbed hold of this story? Because we’re wise enough to realize it will happen again. Likely sooner than we think.

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  • Jen Zingsheim

    What a horrible story. Wow. Bad PR, indeed. 

  • http://www.prbuilder.com/news/the-stealth-pr-crisis-airbnb-and-ransackgate%e2%80%94what-you-need-to-know/ The stealth PR crisis: Airbnb and #ransackgate—what you need to know | PRbuilder.com

    [...] of PR at the Public Relations Society of America. He also blogs at PRBreakfastClub, where a version of this story [...]

  • Anonymous

    “Why? Because the concept of taking an eBay marketplace and putting that into real-life situations in which complete strangers rent out your place, with little to no guarantee of what they will do with it while you’re gone is absurd.”

    Yes, just as absurd as eBay, right?Fail.

  • http://prbreakfastclub.com/ Keith Trivitt

    Thanks for your feedback, but that wasnt’ the point I was making. What I was trying to get across (and perhaps I didn’t make this clear) is the point that eBay’s auction concept works because eBay has very clear protocols on what can and cannot be auctioned or sold so that buyers and sellers do not get themselves into troublesome situations by taking on more than they can chew. But Airbnb, at least prior to the changes it made this week, which were prompted by this unfortunate incident, didn’t have those controls in place, or at least not as stringently, and that clearly impacted the company, has caused great anguish for apparently more than just one of its customers and has damaged Airbnb’s credibility. 

  • http://prbreakfastclub.com/ Keith Trivitt

    Thanks for your feedback, but that wasnt’ the point I was making. What I was trying to get across (and perhaps I didn’t make this clear) is the point that eBay’s auction concept works because eBay has very clear protocols on what can and cannot be auctioned or sold so that buyers and sellers do not get themselves into troublesome situations by taking on more than they can chew. But Airbnb, at least prior to the changes it made this week, which were prompted by this unfortunate incident, didn’t have those controls in place, or at least not as stringently, and that clearly impacted the company, has caused great anguish for apparently more than just one of its customers and has damaged Airbnb’s credibility. 

  • Anonymous

    There is nothing preventing Airbnb and other such sites to have all sorts of checks in place, just like eBay has gradually developed over time. If eBay can do it, so can other sites.

  • http://prbreakfastclub.com/2011/12/06/quick-hits/ Quick Hits: Klout Gets ‘Validated’; O.co Meet Overstock.com | PRBreakfastClub

    [...] framework when it comes to corporate communications. This has predicatable results (see: Netflix, Airbnb, Blippy, et [...]