COUCHSURFING CASE ANALYSIS: SOSTAC FRAMEWORK - FALL 2018 - By: KAWTAR GHAFEL - cloudfront.net

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COUCHSURFING CASE ANALYSIS: SOSTAC FRAMEWORK - FALL 2018 - By: KAWTAR GHAFEL - cloudfront.net
FALL 2018

COUCHSURFING CASE ANALYSIS:

            SOSTAC FRAMEWORK
                By: KAWTAR GHAFEL
                  OMAR MOHAMMED
                   HENRY OBINOMEN
                   JAHANZAIB SCHAHZAD
                   SYEDA MANSURA KHATOON
                   YU-AN
COUCHSURFING CASE ANALYSIS: SOSTAC FRAMEWORK - FALL 2018 - By: KAWTAR GHAFEL - cloudfront.net
Table of Contents
Introduction .................................................................................................................................................. 2
I.       Background Information ...................................................................................................................... 3
      Foundation History................................................................................................................................... 3
      Couchsurfing Statistics ............................................................................................................................. 4
      Company Values: ...................................................................................................................................... 4
II.      Situation Analysis ................................................................................................................................. 5
      Macro Environment Analysis ................................................................................................................... 5
         •       PESTEL Analysis ............................................................................................................................ 5
      Micro Environment analysis .................................................................................................................. 17
         •       SWOT analysis ............................................................................................................................ 17
      Competitors’ Analysis: ........................................................................................................................... 24
         •       Porter five forces Model: ........................................................................................................... 26
III.         Objectives: ...................................................................................................................................... 28
      Business Objectives: ............................................................................................................................... 28
      Digital Marketing Goals (5S Model):...................................................................................................... 29
      KPIs Identification .................................................................................................................................. 30
IV.          Strategy........................................................................................................................................... 33
      Customer Targeting and Segmentation:................................................................................................ 33
      Customer Personas: ............................................................................................................................... 33
      Positioning: ............................................................................................................................................. 38
      Customer Journey: ................................................................................................................................. 38
V.       Tactics & Actions: ............................................................................................................................... 41
      7P’s of Marketing: .................................................................................................................................. 41
      Communication Mix: .............................................................................................................................. 44
      Content Plan: .......................................................................................................................................... 46
      3 M’s ....................................................................................................................................................... 50
VI.          Control ............................................................................................................................................ 53
COUCHSURFING CASE ANALYSIS: SOSTAC FRAMEWORK - FALL 2018 - By: KAWTAR GHAFEL - cloudfront.net
Introduction

Digital marketing denotes advertising delivered using digital channels (market, 2018)
It is also defined as the process of accomplishing marketing goals through the application of
digital technologies and media"(smartinsights, 2018).
Digital marketing involves the use of the following:
   1. Digital platforms –The use of browsers or apps such as Facebook, Instagram and twitter.
   2. Digital data – this refers to the information organisations or businesses collect about their
      customers, competition and the operating industry.
   3. Digital devices –Customers, potential customers use devices to interact with the business
      entity. Such devices could be smartphones, laptops, mobile apps (smartinsights, 2018).

This report draws upon reliable articles and online sources of information to provide a detailed
analysis of the digital marketing SOSTAC Framework for Couchsurfing company. First, the report
will be introducing such company related information as the history, mission, vision and values.
Then, the report with be entailing each of the SOSTAC’s phases, namely: the Situation Analysis
including the macro and micro environmental analysis, the statement of Objectives (be it
marketing and business), the Strategy comprising an analysis of customer personas which in this
case are depicted through hosts and guests, and a discussion of customers journey.Last but not
least is a discussion of tactics and actions including elements from which: the 7 P’s of marketing,
the marketing communication mix, the content plan and the 3 M’s of marketing. Finally, the
report will be discussing control procedures relevant to our digital marketing strategy.
COUCHSURFING CASE ANALYSIS: SOSTAC FRAMEWORK - FALL 2018 - By: KAWTAR GHAFEL - cloudfront.net
I.     Background Information

Foundation History
In 1999, Casey Fenton, a 21 years old computer programmer developed the idea of Couchsurfing.
Fenton got the impression to start Couchsurfing while looking for a place for short-stay on a trip
to Iceland. He sent e-mails to hundreds of students asking for a homestay accommodation (to crash
on a couch), he got several responses offering him temporary accommodation. On his way back to
Boston, he came up with the idea of creating a website that will make it stress-free for people
seeking homestay on their trips. He then registered the domain name Couchsurfing.com in 1999
(Lapowsky, 2012; Wikipedia,2018; Camilo, 2015.)

Interestingly, Couchsurfing international Incorporated started as a not-for profit organization in
2003, and the website was launched a year later (Camilo, 2015). Between 2006 and 2011, while
the organization was still operating as a not-for profit, volunteers at various events in Thailand,
Alaska, New Zealand, Rotterdam and other many more cities, freely upgraded the website.
Unfortunately, as common with voluntary mass efforts, the website was bedeviled with bugs
leading to crashes due to increase in the web traffic. In 2006, most of the website data was lost due
to a crash, Fenton (the founder) asked for online help and Couchsurfing volunteers raised
approximately $8,000 for the reconstruction of the website (Barnett, 2011; Camilo, 2015).

Due to Couchsurfing’s inability to get the 501© (3) not-for profit organization status from the
Internal Revenue Service in 2011, Couchsurfing opted to move from not-for profit status to for
profit status. Couchsurfing Incorporated was dissolved and its assets sold to a for profit
organization called Couchsurfing International in 2011. Couchsurfing raised initial funding of $7.6
million from Benchmark Capital and Omidyar Network in 2011, and in 2012, it raised additional
funding of $15 million from General Catalyst partners (Bizapedia, 2018; Perlroth, 2011).
Understandably, the transformation of Couchsurfing from a not-for profit to a for profit company
was subject to heavy criticisms from its community members (Vivion, 2013). In 2012,
Couchsurfing launched its mobile Apps for Andriod and iOS smartphones and in 2016, it added
“hangout” features that permits members to meet with other nearby members within a short period
of time (Jacobs, 2018; Couchsurfing, 2016).
COUCHSURFING CASE ANALYSIS: SOSTAC FRAMEWORK - FALL 2018 - By: KAWTAR GHAFEL - cloudfront.net
Couchsurfing Statistics
Couchsurfing is a global community of: 18 million members In 7 continents In over 180 countries
in over 200,000 cities, participating in 150,000 events. The free accommodation provider has also
above 900,000, 135,000 and 80,000 followers on Facebook, Instagram and Twitter respectively.
Their primary investors are:
           Valencia street capital
           Benchmark Capital
           General Catalyst Partners
           Menlo Ventures
           Omidyar Network
           CEO: Patrick Dugan
           Headquartered in San Francisco, USA.

Company Vision

“We envision a world made better by travel and travel made richer by connection. Couchsurfers
share their lives with the people they encounter, fostering cultural exchange and mutual respect “
(Couchsurfing, 2018).

Company Values:
The values Couchsurfing is to create opportunities for individuals to (Couchsurfing, 2018) :
           Share their lives and cultures
           Create connections
           Offer kindness
           Stay curious
           Leave the earth better than they found it
COUCHSURFING CASE ANALYSIS: SOSTAC FRAMEWORK - FALL 2018 - By: KAWTAR GHAFEL - cloudfront.net
II.      Situation Analysis
Macro Environment Analysis

      PESTEL Analysis

                                    Political and Legal:

The political situation with regards to worldwide consumption behavior and travel current travel
trends presents promising opportunities for Couchsurfing. First, with many countries signing free
trade and other agreements removing barriers to specific geographical clusters as with the case
of the European Union, Union of South American Nations, Association of Southeast Asian
Nations, and some other unions, citizens of the latter are allowed access to any of the
aforementioned countries without administrative or financial restrictions. This provides an
opportunity for Couchsurfing to seize with the facilitated travel and cost-free entrance. As such,
people may be moving daily to any of those destinations for varying purposes, be it short
vacations, longer leisure time or business trips. Couchsurfing will, hence, enable them to stay
freely at hosts’ place, pocketing extra dollars that may be spent otherwise on accommodation.

However, the situation is not always as optimistic, as there are countries imposing strict policy
regulations that may hamper individuals to host foreigners for national security issues for
instance, which makes penetrating and spreading Couchsurfing culture challenging in such
destinations. Other countries, such as China, are even restricting some US social media platform
like the giant Facebook, replacing it with local equivalent platforms, making once again the
success of Couchsurfing slowed down compared with the rest of the world. Couchsurfing must
also take into account the political situation in some countries that may leave a negative
impression for foreigners regarding safety and security issues. For instance, if the country at hand
has an unsafe reputation (as with the case of some African destinations), tourism is more likely
to be diminished, which may be a challenge for such business as Couchsurfing to deal with.
Political conflicts may also be raising tensions between nations, spreading hatred and instilling
COUCHSURFING CASE ANALYSIS: SOSTAC FRAMEWORK - FALL 2018 - By: KAWTAR GHAFEL - cloudfront.net
grudges and prejudices in each of the parties' minds. Couchsurfing may help in healing wounds
and scars resulting from the latter conflicts and breaking stereotypes by bringing people together
under the same platform to unveil the truth about their cultures that was misrepresented by
media.

Analyzing the Legal environment is such a critical issue because each country has its own laws
and regulations. This makes some countries like China, Belarus, Ethiopia, Iran amongst others
being categorized as Internet enemies because they do not allow their citizen to have a free
access to the internet and are restricting many social media networks. For example, China has its
own social media WeChat that is replacing Facebook and Instagram. Another issue is censorship,
which means that the government put citizens’ online behaviors under scrutiny and careful
observation, even restricting some of the Internet content for users such as the case with Egypt,
Libya, Saudi Arabia, just to name a few. Based on the latter two issues, Couchsurfing penetration
may be subject to many hurdles.

On the other hand, the General Data Protection Regulation (GDPR) presents in Europe to protect
the privacy and data of internet users. So, personal data of the individuals are totally protected
by the law and the regulations. Before operating in Europe, Couchsurfing must consider more
laws and penalties which may in sometimes reach 20 million euros.

Nowadays, there are three internet laws that must be known by any online present companies
(Butler, 2013):

   o Electronic Communications Privacy Act (ECPA): This law allows the government to access
         e-mails, Facebook, I-cloud and any other personal database.
   o Cyber Intelligence Sharing and Protection Act (CISPA): a US law which allows technology
         companies to share information with the Federal government to ensure the security
         against cyberattacks.
   o Computer Fraud and Abuse Act (CFAA): CFAA makes stealing on the internet a Federal
         crime that people may be jailed for.
COUCHSURFING CASE ANALYSIS: SOSTAC FRAMEWORK - FALL 2018 - By: KAWTAR GHAFEL - cloudfront.net
Such laws are initially based within USA legality to protect the users and ensure their security.
This means that when Couchsurfing is operating in the USA, it should consider the
aforementioned regulations.

                                         Economic:

To further our knowledge about the Economic environment impacting Couchsurfing business, we
have to look for some facts about the Travel and Tourism sector first. In fact, one of the chief
contributing factors in economic development and worldwide job creation is Travel and Tourism.
The latter industry recorded USD 7.6 trillion and 292 million jobs all over the world in 2016 as a
direct and indirect contribution in the Travel and Tourism sector. Given that the growth of the
world GDP increased approximately by 3.5% in 2016, this is equivalent to 10.2% of the world’s
GDP and around 1 in 10 of all jobs (World Travel and Tourism Council, 2017). The optimistic travel
economy does not end here. In fact, the growth of Travel and Tourism to the world’s economy
was forecasted in 2017 to increase by 3.5% (World Travel and Tourism Council, 2017). As such,
investments in Travel and Tourism record an increase by 4.1% in the former year, which is
promising for Couchsurfing to penetrate some markets with this high travelling trends.

However, this sector was also subject to down times. Accordingly, the rising inflation fueled by
by the increasing oil prices led to diminishing worldwide consumer’s expenditure all over the
world. Relying on these facts, Couchsurfing may capitalize on this to enhance the low cost value
of their service, and promote budget savvy travel around the world.

Determining and understanding the expenditure of travellers in the world will clarify the vision
of Couchsurfing success in specific countries. Below are some examples of the highest Travel
expenditures by countries according to World Travel and Tourism Council (2017):
COUCHSURFING CASE ANALYSIS: SOSTAC FRAMEWORK - FALL 2018 - By: KAWTAR GHAFEL - cloudfront.net
According to these statistics, China has a
promising growth potential in travelling, this
                                                              Travel Expenditure by
means that Couchsurfing can increase its
                                                              Countries in 2016 (%)
market share if the target market shifts a
                                                                          4%                           Rest
little bit to China, and can serve the Chinese                       5%
                                                                                                       China
                                                                    6%
youth whose looking for a low budget                              11%                                  USA
                                                                               53%
travelling cost. Nevertheless, China is also                       21%                                 Germany
                                                                                                       UK
restricting the use of common US social
                                                                                                       France
media, which may be problematic.

Moving to the USA which has the second highest percentage after China that can be a good
market also for Couchsurfing as it a huge country with a palette of different nationalities and high
travel expenditures, making it another promising market to expand business within.

Moreover, economic forecasts show that Asia Pacific will be the fastest growing in the Travel and
Tourism in the near future, with a 6.1% increase, equivalent to USD 2.3 trillion expenditure, while
the expectation of growth in Europe will increase by 2%, North & South America by 2.3% and
Africa & Middle East will increase by 1.8% respectively (World Travel and Tourism Council, 2017).
So, we think according to these expectations the market will be reshaped in the near future and
the target markets will be shifting towards Asia.

Also, the world is moving to a sharing economy concept, translating the collaborative aspect in
the use of goods and services between peer to peer enabled by a specific platform (Radcliffe,
2017), Such concept is inherent in Couchsurfing values and core activity as the company provides
a solution for people to save money by sharing their accommodation with another person.
Another trend in the economy is the growing ecosystem of low-cost airfares supporting the
higher inflation such as Ryanair, EasyJet and AirAsia, which have reshaped the way of travelling
“lighter”. This dragged massive numbers of travellers especially younger segments like students
seeking for a low-cost budget.
COUCHSURFING CASE ANALYSIS: SOSTAC FRAMEWORK - FALL 2018 - By: KAWTAR GHAFEL - cloudfront.net
Social:

Overall travel patterns for 2016 record that people are travelling for leisure or business,
internationally or domestically (World Travel and Tourism Council, 2017), with 76.8% of people
travelling for leisure and only 23.2% for business. So, there is an existing need for leisure travel
by the largest travelers’ segment worldwide, which in turn creates an opportunity that
Couchsurfing may seize. This section discusses top travel destinations from recent statistics,
before digging deeper into the raising travel trends for Millennials and Generation Z segments,
their motivations, travel behavior and barriers to moving cross borders.

Top Travel Destinations in 2018

Travel is a passion, as exhibited by frequent wander lusters. Some destinations sustained
travelers’ bucket list choices for decades and others on the rise in recent years. According to a
study by Kutschera (2008), 45% of travelers list the places they want to visit in their life, out of
which. Most likely at the end of 2018, almost half of the latter plan to see at least one out of
Seven Wonders of the World. Among these travelers, 35% want to ease their taste buds by trying
a local food. Whereas, 34% are like to be thrilled by visiting all famous amusement parks in the
world and 34 like tropical places and islands. As for popular travel destinations, as mentioned by
Travelagentcentral.com, these are New Zealand, Australia, Philippines and Thailand from Asia,
Costa Rica and Peru from America, other European countries like Italy, Spain and UK (Priority
Pass, 2018). Iceland is also becoming a popular travel destination welcoming millions of travelers
every year. According to Priority Pass (2018), Iceland has attracted many travelers in 2017,
making tourism their major export. In 2017 about 2.2 million travelers opted for Iceland, about
one third of them visited there in winters (Iceland Tourist Board, 2018).

Experience Value in Travel & Experiential Economy

Travelers enjoy their travel more when they can participate in various activates happening in the
world. About 28% of the travelers in 2018 want to be a part of a unique cultural event, 27% of
desire to absorb new skills, and 25% desire to cover a memorable tour by car or train, people
who want to challenge themselves by going to a remote area are 25%. (Booking.com, 2018). So,
people are fonder of experiences rather than products, and are less concerned about material
things or superficial life. Once CEO of Airbnb said, according to a research, “three out of four
millennials prefer an experience over a material product” (Kutschera, 2018). Also, year 2018 is
filled with love for activity destinations, which offer experiences related to nature, food, safaris
and sailing (Travelagentcentral.com, 2018). Following the same logic, an online travel agency has
addressed the trend variation within the travel industry by reporting that “travelers are
concerned about local experiences”. As such, the belief is shifting towards a more culture
oriented, nature oriented and artistic travel aspect. The agency also reports a trend for more
local culinary experiences. This, in result is, causing the mass tourism to redirect its pressure
towards newer places and sites and cause an increase in independent traveling trend (Fromm,
2018).

Sustainable Travelling

Another travel trend is about sustainability. As such, younger travelers are craving for
information and not just only looking for thrill or adventure. These are the concerned ones about
nature and looking for a nature-like experience. The latter are also careful about their
surroundings and are not freely littering the places (Expedia, 2018). As a result, travelers and
local authorities are working together in a way to preserve such sensitive sites, which may be
prone to environmental changes that is including historical and heritage sites.

Convenience is key:

Half of Generation Z prefers all in one shopping destination travelling websites. Also, Millennials
strive for fast trip planning with minimum efforts, that is, they would like to find what they want
now and quickly.

Threatening Trend to Home Sharing:

It is predicted that Ideas like home sharing will be facing a downward trend. Independent
travelers don’t want a hovering host. In fact, 30% of Millennials would prefer a host to be
available but not present all the time (30%) and 12% of them want the kind of host to whom they
don’t have to speak with at all (Booking.com, 2018).This is a threat to the Couchsurfing business
who is all about fostering the communication bonds between hosts and guests around the world.

Solo Travel and Women Travelers

A third megatrend in travelling resides in a raise in solo and female travel. The newspaper website
thestar.com revealed the statistics of the current year, showing that women are mostly living
alone as compared to male population, which has never happened before. This has caused the
female target to search for traveling information for a single person and travel solo (Priority Pass,
2018). Another travel booking website Intrepid Travel, which is concerned about thrilling and
adventurous tours and promoting sustainable itineraries, report that single travel search was
accounting for about half of the travelers who booked for a tour by the company in 2017 (Priority
Pass, 2018).

Spontaneous Travel

Millennials don’t look for a headache pre planned trip which could be disappointing if nothing
goes as planned. Rather, the they are more likely to opt for a spontaneous tour which is not
planned and booked in advance. This travel experience is supposedly more adventurous and
challenging and, although shorter in period, are likely to be recurring several times in a year is
likely to be many times in a year (Fromm, 2018).

Low Cost Travel

Another important travel trend is shifting to low-cost. It is not to be assumed that people will
stop travelling to the traditional destinations because they are not unique enough. Some on low
budget might also take the trip to traditional city destination because of the cheap travel
packages and discount on airline tickets (Priority Pass, 2018). Millennials on a low budget are
mostly looking good places to travel in the same continent they are currently residing in. So, if
they are offered an affordable travel to another continent, they are likely going to take it. The
independent travelling traits for the Millennials are resulting in search of cheap one-way fare or
multi city travel fare and flexible booking (Fromm, 2018).
Social Media Travel Inspiration

People who travel to sights which are already world famous like Eiffel tower in Paris, London Eye
and Thames in London are already a part of social media, but youngsters today want to go beyond
these places and explore the unexplored areas of the world. Travelers are more and more
inspired by sight pictures of world’s remote areas and breathtaking nature views. As popular
social media platforms are filled with clishe destinations, travelers are now looking in unvisited
sites for unique experiences and pictures, causing these unpopular areas to be more viral and
popular among social media followers (Priority Pass, 2018). Social media, however, has a
profound impact on purchasing decisions and travel choices. Millennials are mostly affected by
v-logs, blogs, online mobile, web apps, and social media. As such, recommendation on these
social media sources mostly help finalizing a travel destination among this segment and that of
Generation Z alike. Millennials are also motivated to post on social media, be it on Pinterest or
Instagram because of this travel. As with regards to online behavior on social media, Millennials
are more forward and are likely to post the location pictures on the latter platforms even before
they have booked a travel trip to that destination (27%). Millennials are trend following beings,
they imitate what their friends do on social media. So, basically social media is the triggering
factor. Millennials see their friends and favorite influencers post pictures and videos of places
they are visiting and get the desire to visit that place. However, this desire gets challenged by the
travel cost and they face the reality. In this case, low cost airline packages are their only hope.
So, when they get an affordable ticket, they are mostly attracted to take the offer and travel
(Fromm, 2018).

Motivation for Travel

Comparing Millenials to Boomer travelers with regards to travel interests, the former are more
inclined towards looking for an adventure (27%) than the latter (21%). Millennials are also looking
forward to trying something new (24%) than the Boomers l(15%). Finally, Millennials are more
concerned about improving their health through the travelling (12%) than their older
counterparts (2%) in 2018 (Gelfeld, 2017). The concept of alternate accommodations is also more
acceptable to Millennials (Gelfeld, 2017). Another aspect confirming the young travellers’
dedication to travel is the fact that Generation Z are more willing to arrange for resources by
working part time, or even selling some personnel belonging for a chance to explore the world
(Expedia, 2018).

General Travel Behaviors

According to the newer trends of this year, it has been observed that travelers are setting their
sights on places they normally would not deem worthy to travel and consider very under rated.
The trends shown by intrepidtravel.com travel destinations of Europe for instance like Poland,
Moldova, Cyprus and Belarus are among the most visited sights on visitors’ maps.

Millennials and GenXers are more likely to travel both domestically and internationally (64% and
59%) than are Boomers (47%). Millennials are also planning more international trips compared
to Boomers (Gelfeld, 2017). Moreover, the former are inclined towards living and eating with
locals while travelling destinations (Gelfeld, 2017). In the world of travel, chances of getting new
places and attractions explored by masses is mostly directed by solo travelers, this has become
possible because of personalized and customized travels (Fromm, 2018).

Barriers to Travel
There is a huge portion of this world who loves to travel, explore the most amazing places of the
world. Most of these lovers are full time travelers looking for most economical ways to travel,
but this dream can be deemed very expensive. Accordingly, 47% of the Millennials say the biggest
element which they consider as a barrier to travel are the high costs of travelling. Whereas,
security is not of a big concern to them, very less number of Millennials consider security as a
barrier to travel (Gelfeld, 2017).
Technological:

Provided that Couchsurfing is entirely based online, the company is hence extensively reliant on
technologies. The 21st century's shift to digitalization has dramatically affected the hospitality,
tourism and travel industry as a whole, and social travel sites in particular. Chief external
factors fueling change in travel habits include but are not limited to:

Global Connectivity Trends: world citizens are more connected now than ever, with two over
half of the global population having online access. The latter proportion is expected to reach
75% of the world’s population in the next 2 years (Hollander, 2017). This dramatically burgeoning
trend is not stagnating soon, with nearly a quarter billion new internet users for the first time
last year, from which the African continent is exhibiting a yearly 20% growth (McDonald, 2018).
Although internet penetration worldwide may seem to be covering little in Central Africa and
Southern Asian countries, the latter still account for the fastest growing regions in terms of
internet adoption. Overall, its worthwhile to say that internet has been overwhelmingly taking
part of our everyday lives, as depicted in a daily time spent vacillating from the least 2h53min (in
Morocco) to over 8hours30minutes in Indonesia, Thaila nd and Philippines.

Growing Use of Technological Devices: Another major trend is the huge dependency on
electronic devices, which use is sought to consume from 8hours and 41minutes as the daily
average per individual, or 20minutes more than sleeping time. Overall, the use of mobile phones
has been the most pervasive, accounting for 52% of web traffic compared with 43% for laptops
and desktops and a mere 4% for tablets in 2018 (Hootsuite). In fact, mobile phone users have
exceeded 5 billion in the present year, recording an annual 4% raise. Interestingly enough,
technology companies such as the Chinese Oppo & Vivo and the Indian Micromax are targeting
emerging markets to ensure a persistent growth of Internet adoption in the future. As a result,
such markets account for the biggest share of new mobile subscriptions growth, with 40%
clustered in Indonesia, China, Pakistan, India and Nigeria (Hollander, 2017).
Social Media Use:

With over 3 billion social media users every month, access to the internet is not the only trend
to watch for. Companies are ought to capitalize on the massively growing use of social media,
expected to keep growing by a yearly 13% basis. Platforms like Facebook, Instagram, Twitter
and Snapchat are gaining top popularity worldwide, with almost 1million new user daily
throughout this year. In fact, 9 out of 10 of those users are accessing such platforms from
mobile devices (McDonald, 2018).

Digital Impact on the 21st Century Travel:

Digitalization has altered the way we travel in many ways. With the varying apps and devices
allowing travellers to save storing space for such items as books (replaced with ebooks), mp3
(replaced with Itunes or Spotify apps), maps (replaced with google maps or other apps), and so
on, the trend is towards a smarter, lighter, faster and more convenient travel experience. With
mobile phones and other electronic devices overwhelming our everyday lives, the trend is
shifting toward planning and booking the entire trip online, from the flight to accommodation
and touristic activities. In fact, App and mobile web booking recorded a dramatic annual growth
of 126% between 2015 and 2016 (The Golden Age of Youth and Student Travel, 2017). This
technology savvy trend is also involving travel search, which totalled 47%, 40%, 38% and 34% in
Europe, Asia, Africa and the Middle East, and Latin America respectively, as per the fourth quarter
of 2017 (Kutschera, 2018). Oliver Heckmann, Google’s VP of Engineering for Travel & Shopping
reports that about 60% of consumers claim AI to be their preferred travel facilitator from
activities like search to actual travel experience (Giaccomazo, 2017). The buzzword for today’s
travel, especially for Millenials, lies in unique experiences and personalization, which is enabled
through present technologies. From travel apps, tailored blogs, niche websites to social
networking sites are all making dream trips a reality (Marques, 2017). Another trend for youth
travellers with regards to technology is that the latter group, especially within 16 to 26 years old,
are raised in a “world of Online Travel Agents, Social Media and constant connectivity” (The
Golden Age of Youth and Student Travel, 2017). Last but not least, Technology enabled travellers
to bypass language obstacles, through a multitude of free translation apps available in
smartphones that are facilitating the interaction with locals. Such apps are even currently
translating texts from pictures to any desired language.

                                       Environmental:

Climate and weather can be important factors for choosing a travel destination. It is also an
inevitable factor for smooth business operation of tourism businesses. Climate is the key driver
which facilitates enjoyable vacations. As such, a hostile climate and harsh weather conditions may
drive tourists to travel to warmer or drier locations (Lise & Tol, 2002). Accordingly, domestic
tourism expenditure in Canada increased by 4% because of the increase in the temperature by 1
degree Celsius. A recent study shows that better climate influence European household for
domestic travelling whereas adverse climate push for more international travelling. The experience
and satisfaction mostly depend on the weather. For example, for beach activities, people will prefer
an enjoyable sunny day. Tourist’s safety also depends on the weather. In 2003 a number of heat
waves have been observed in Northern Europe which was responsible for 1500 deaths in France
(UNWTO, UNEP, WMO, 2009). Recent heat waves also have a considerable impact on tourism
in Northern Europe. Thus, warm temperature, clear waters, and low health risk are the most
important environmental features which influence the choice of holiday destinations. As
Couchsurfing is providing accommodation to travelers, so it is very connected with the tourism
industry. The use of Couchsurfing will be optimized in the most attractive tourist destination. Thus,
the environment is a key factor for the success of Couchsurfing.

Another aspect of the environment resides in sustainable use of resources. Accordingly, home
sharing is growing as a sustainable-like solution to abusive resource utilization. Couchsurfing has
helped residents around the world easily share their homes and make the best use of the existing
resources and a more environmentally sustainable way of travelling and vacationing. There is some
clear environmental benefit from using our homes more efficiently. As our home can be used as
temporary accommodation there will be less need for infrastructure and transportation which will
result in less use of resources and ensure less carbon emission. Usually, hotels use a lot of water
from washing towels and sheets to maintenance and operations. But through the use of host houses
water consumption can be minimized. Moreover, the guest in couch surfing usually uses public
transportation, walk or bicycle as their primary transport which reduces fuel consumptions. And
through Couchsurfing ecological tourism can be promoted.

Micro Environment analysis

   SWOT analysis

Results from our macro and micro-environmental analysis yield to the following SWOT matrix,
depicting key company strengths and weaknesses, along with industry opportunities and
eventual threats as follows:
Website:

Website is the most important marketing tool for any online business. Couchsurfing is a travel
community which bring together almost 14 million locals and travelers worldwide. Couchsurfing
is an online platform for finding accommodation for travelers and enables travelers to meet and
discover the best touristic options. The website is designed in a way to reach maximum travelers/
hosts around the world. The company have positioned itself through SEO in Google search engine
that helps to drive more traffic in their website. They have 23.49% traffic from Google search,
from which 99.81% search is organic and only .19% is from paid search (SimilarWeb, 2018).
Couchsurfing Website analysis is provided in details as depicted in the below table:

 No                Title                      Result of analysis                  Interpretation
 1.   Responsiveness of website         Couchsurfing works perfectly in     Couchsurfing used a usable
                                        different browsers like: Chrome,    format for every which is
                                        Firefox, Safari, Microsoft Edge,    working perfectly across all
                                        Internet Explorer etc. And in       browsers and devices.
                                        different devices like: laptop,
                                        desktop, tablet, smartphone
                                        etc.

 2.   Response Time                     If    we     compare       other    Couchsurfing should improve
                                        competitors     like:    airbnb,    their response time to
                                        hospitality                 club,   achieve         competitive
                                        globalfreeloaders     etc.     of   advantage.
                                        Couchsurfing, the competitors
website took less time to load
                          than the Couchsurfing website
                          page. For Couchsurfing it took
                          around 4.5 seconds whereas
                          other competitors’ website took
                          2-3 seconds to load.

3.   Conversion path      In Couchsurfing website, they       The most important thing in
                          have two call to action buttons:    Couchsurfing is creating
                          join and log in in the top of the   account. Through an account
                          website. It has two option for      anybody can find a place to
                          login. Like one can choose          stay or can host any travelers.
                          Facebook or email account to        That’s why they make it easier
                          login or sign in.                   for users by placing it in the
                                                              top of the website landing
                                                              page.

4.   Essential section    Couchsurfing has: about, safety,    As the trust issue is related to
                          support, blog, shop in the          Couchsurfing concept, they
                          bottom of the page. But if a        put some guidelines in their
                          person creates an account and       safety page to make it safer
                          logs into it, then the search       for the traveler as well as for
                          button appears in the top of the    host. They have all relevant
                          page. There is also a button for    options available to make the
                          getting verified which provides     navigation easier.
                          some more benefits and button
                          for group and events.

5.   Content of website   There are various attractive        The content of Couchsurfing
                          content and stories in their        is giving a clear idea about the
                          website which can engage the        concept by sharing different
                          visitors.                           stories of Couchsurfers.

6.   Social media Links   They have their social media        They should include the links
                          links in bottom right corner of     of Pinterset in their website
                          the website. But they don’t have    as their audience have
                          links of Pinterest even they have   increasing presence in that
                          their presence in Pinterest.        website. They should also
focus on Snapchat which is
                                                              popular now a days.

7.    Language options   They have 9 language options in      The language option enables
                         their website. This button is in     the user to navigate the
                         the top of the page. They have       website more easily but they
                         English, Spanish, French, Italian,   should include more language
                         polish, Portuguese, Chinese,         option in their website as well
                         Russian, and German as               as mobile application.
                         language options.

8.    Ease of sharing    Users can easily share in their      They have made it easier for
                         social platform by clicking in the   the users to share their
                         social media linked in their         stories and experiences in
                         website.                             social media by including
                                                              some links. But they should
                                                              include more options.

9.    Engagement         Total visits in October 2018 is      They should try to attract
                         7.37M and Average visit              more people to visit their
                         duration is about 7.31 minutes.      website and should try to
                         The average pages per visit is       engage more people to
                         6.87 and their bounce rate is        reduce the bounce rate.
                         34.31%.

10.   URL Patterns       They have a uniform URL which Their URL            is   clear   and
                         remain constant while go to organized.
                         other pages.
Social media advertising:

Couchsurfing has 5.67% traffic from social media. They are
using different social platforms from which Facebook
accounts for most traffic generation (57%). The company
also has 880,764 people following them and 893,825 people
like them in Facebook (on 25.11.18). They regularly post
different relevant attractive contents specially image and
videos to engage more people every day. They have 133k
followers in Instagram, in which they primarily use user
generated contents. Travelers as well as host can share their
experience using #travellers or #couchsurfing etc. In
YouTube they have 2.3K subscribers and over 40 videos.
People share their stories and experiences while
Couchsurfing in any area. There are also videos about
guideline on using the platform and the benefit of using
these. There are some travel vlogs by travelers covering
tourist destination and different cities. The company also
uses Twitter for social media marketing, in which they have
77.3K followers and 10.9k tweets using varying hashtags like
#travel, #life, #Couchsurfing etc. Finally, Couchsurfing has
been also using Tumblr where traveler post their travel
stories and build a string travel community.

                                            Blogs:

Couchsurfing has a blog which can be used as a warehouse of information related to travelling
and accommodation. They ensure to profile all interesting traveler and hosts across all its
content channel. The blog is a story telling platform where people share about the culture,
heritage of different places as well as interesting activity of any destinations. The company uses
videos and images of travelers in promoting the attraction of a place. They have news, events,
advice, press options for travel in their blog. They have also store linked in their blog page from
where traveler or anybody can purchase cloths or gifts which have logo of couch surfing.

                                      Mobile Apps:

Couchsurfing is also owning its mobile application for both iOS
and android platforms, which can be found in apple and Google
play-stores. The profile display in the mobile application is
designed in a way that enables easy browse of personal
descriptions, references, photos and friends. Such apps also help
in getting immediate access to new couch request or discussion
on existing request. The picture right-hand is a screenshot of the
company’s mobile app. A detailed analysis of Couchsurfing apps
is provided below.
Android and IOS Apps     Couchsurfing has both Couchsurfing                 is   highly     available
                         IOS and Android system           through the two biggest app platforms
                                                          as well as the website of couchsurfing.
                         Couchsurfing               has
                                                          This     give    customers      maximum
                         different descriptions in
                                                          accessibility.
                         App Store in IOS system
                         and in play store in
                         Android.       But        both
                         descriptions show that
                         couchsurfing         is     a
                         fantastic way to make
                         friends with people from
                         around the world.

APP’UI                   Their app’s user interface -If travellers want to open a trip in
                         need to be improve to make couchsurfing, they need to add more
                         it more easier for people to information in their personal homepage, at
                         use                              least 50%.

                                                          -User need to choose the time after they
                                                          have chosen their place of trip. It could be
                                                          chosen at the same time.

App functionality        With a 4.8 IOS rating and Some complain like “cannot login”, “the
                         4.4 rating in google play new message is not able to alert me”, “no
                         store. But some people notification”.
                         complain       about       the
                         instability of the App.

Number of App Download   Google play: 1 million           We could not find the information of
                                                          download number in Apple, but this app
                         Apple: no information
                                                          has received 302 rating in IOS system.
Competitors’ Analysis:

 Competitor      Established             Size         Value to guests            Strengths          Weakness
   name             date
Airbnb           2008          2.9 million hosts      Great, clean and        24/7 global         Expensive
                                                      furnished places to     customer service.
                               800,000 average
                                                      live in.
                               number of stays each                           Advertisement
                               night                  Secure.                 budgets.

                               14000 new hosts each   Great user interface.   Simple and
                               month                                          advanced website
                                                      Easy to use app and
                                                                              features.
                               It has access to 191   website.
                               countries.
                                                      Guests can choose
                                                      their requirements

                                                      easy to pay.

Hostel world     1999          Access to more than    Group bookings.         Largest hostel      Charged stay
                               170 countries                                  booking platform.
                                                      Offer airport                               Lack of privacy
                               10 million guests      transfers, car          Cheap stay.
                                                      rentals, and travel
                               36000 properties                               24/7 global
                                                      insurance.
                                                                              customer service.
                                                      Free cancellation
                                                                              Professional and
                                                      within 7 days.
                                                                              good website.
                                                      Guides and reasons
                                                      to visit different
                                                      countries.

                                                      Recommended cities
                                                      (Must visit guide)

WarmShowers      1993          118,225 members        Sharing great stories   Free stay.          Only for cyclists.
                                                      and drink.
                               71,784 hosts                                   Simple and user-    Need donations
                                                      A community for         friendly website.   to operate.
                               161 countries
                                                      bicyclists.
                                                                              Non-profit          Less awareness to
                                                      Be friends to people    organization.       people.
                                                      with same interests.
                                                                                                  Limited space.
Not much secure.

Servas             1949   100 countries           Sharing culture.         Free stay.           Stay is usually
                                                                                                limited to two
                          over 15000 households   Help in finding          Focused to
                                                                                                days.
                                                  answer to the            promote peace.
                                                  questions about                               Lack of privacy.
                                                                           Process to choose
                                                  different countries
                                                                           a suitable           Old fashioned
                                                  or cultures.
                                                                           member.              website interface.
                                                  Sharing personal
                                                                           Host needs to give   Limited space.
                                                  experiences.
                                                                           report of stay to
                                                                                                Apply at least 4
                                                                           Serves
                                                                                                weeks before
                                                                           coordinator.
                                                                                                stay.

                                                                                                Membership fee
                                                                                                for members.

Hospitality club   2000   328,629 members         Share culture and        Free stay.           Basic website and
                                                  help.                                         features.
                          207 countries                                    Huge community.
                                                  Possibility of getting                        Antiquated
                                                                           Largest platform.
                                                  guided tours                                  interface.
                                                  through the town.        Global presence.
                                                                                                Load members
                                                  Make new friends all                          with messages.
                                                  around the world.
                                                                                                Unsecure.
                                                  Learn from others
                                                                                                Limited space.
                                                  experiences.

Global             2010   123,844 members         See the world from       Free stay.           Unsecure.
Freeloaders                                       local's perspective.
                                                                           Global presence.     Basic website and
                                                  Bringing people                               features.
                                                  together.
                                                                                                Antiquated
                                                  Save money.                                   interface.

                                                  Make new friends all                          Limited space.
                                                  around the world.
Porter five forces Model:

                                  Threat of new entrants:

Threat of new entrants is moderate although there are little barriers for companies to create an
online community business. Indeed, many of competitors to Couchsurfing are standing way
behind either due to a poor website design or a mobile phone application. However, they can
still disturb the share of Couchsurfing by improving in these two areas. Other major and powerful
competitor is Airbnb, which is an indirect rival but with great potential and established
community, and this can be a biggest threat for Couchsurfing. Airbnb can offer guest an
accommodation free of charge in exchange for sharing their culture, in order to enter into the
territory of Couchsurfing. Also, the accommodation sector for travel and tourism is a mature
market, which makes entry of new rivals less appealing.

                                    Threat of substitutes:

Threat of substitutes is very high in this industry as switching cost of consumer is almost non-
existent. Most of the platforms similar to this don’t spend on advertisements, hence, people
don’t know about them much. Customer can easily shift to other platforms like Hospitality club
or Servas if they start doing advertisements. Right now, people in groups are struggling in getting
an accommodation together using Couchsurfing. People will go for those options which offer
more benefits than Couchsurfing.

                             Bargaining power of customers:

This is very low, as customers don’t have much to bargain with Couchsurfing. This service is
provided to them for free and the only thing they have to do is to share cultures in exchange.
Bargaining power of suppliers:

Bargaining power of members/hosts is moderate. Although there is no any monetary benefit
involved, as hosts are interested in sharing each other’s cultures and are willing to provide
accommodation to strangers for free, yet it is host who decides whether or not to accept guests
stay request. So, the power to let a guest stay at their place is totally dependent on the host.

                                      Industry rivalry:

Rivalry from existing competitors is moderate. There are other big platforms which are doing the
same as this but those are either nonprofit or they don’t have much capital to invest on
advertisement and other facilities (Website and mobile phone application). Couchsurfing is
gaining interest of people very rapidly and is known amongst youth traveler’s community,
especially with its user-friendly website and mobile app and freemium and sharing concepts that
go hand in hand with the current economy trends and make Couchsurfing stand ahead of
competition.
III.   Objectives:

Business Objectives:
Couchsurfing business objectives are designed to be a SMART goal which is:

1. Raise Brand Awareness amongst our target
                                                            SPECIFIC
    segments.
 A recent study conducted by Travel and Tourism
                                                                       MEASURABLE
(2017) show that travel and tourism have great
potential for high growth in Asia Pacific by               ACHIEVABLE
approximately 6% and around 2% in Africa in the next
few years. Couchsurfing will be deploying marketing                    RELEVANT
communication efforts to bring onboard potential
customers from Asia, Middle East and Africa. stated         TIMELY
an objective to expand in Asia and Africa and the
Middle East by 44% by 2022. The statistics show that 75% of Couchsurfing users in US and
Europe, while the studies show that the growth in Travel and Tourism is increasing rapidly in the
Asia Pacific and the Middle East so its great market to penetrate.

2. Become the preferred accommodation solution for Millennials and Generation Z budget
    travelers by 2022.
As the trend of low-cost travel growing and the inflation rate is high worldwide, so, Couchsurfing
aims to provide a solution for youth around the world to travel with the lowest possible cost.

3. Raise the company’s revenues by 40% by 2022.
The major source of revenue for Couchsurfing is the annual membership verification fee of $60.
As at 2017-year end, Couchsurfing had Four Million and Four Hundred Thousand yearly active
users and Five Hundred and Twenty-Eight Thousand (528,000) annual fee paying verified users,
representing 12% of the active users. The revenue generated from users’ verification in 2017 was
Thirty-One Million, Six Hundred and Eighty Thousand USD ($31,680,000) annually. By year-end
2022, the number of yearly fee paying verified users is expected to grow by 40% (211,200) leading
to revenue growth of Twelve Million, Six Hundred and Seventy-Two Million USD ($12,672,000)
(Couchsurfing, 2018).
Digital Marketing Goals (5S Model):

                  Sell                Speak Serve

                            Save                   Sizzle
  o Sell: it is the reason of existence for any profitable organization, Couchsurfing’s sales will
    depend on attracting more people to verify their account by USD 60 per year which adds
    to the credibility, results accuracy and provides unlimited recommendations for
    accommodation. Couchsurfing will also generate profit from ads delivered by another
    organization and this organization posting their ads on Couchsurfing depending on the
    traffic that the company has. This sell will be, in turn, generated depending on the
    strategies to be used tactics and action phases

  o Speak: we believe that communication and engagement with the audience and
    customers are crucial, the engagement can retain the customer for the longest time of
    using the service. Couchsurfing will keep engaging with the customers by letting them
    share their own experience and their local life for all the world.
  o Serve: serving the best value for the customer and ensuring their satisfaction is a key of
    success, which is considered by Couchsurfing as the main goal that the customer is the
    most important asset for the organization. Thus, delivering quality service which is free
    safe accommodation is Couchsurfing's main purpose.
  o Save: the transformation of the traditional marketing to the digital marketing was based
    on cost saving and effective reaching to the audience, Couchsurfing digital marketing
    campaign will be targeted to the right segment with the most effective online tools to
    have the needed efficient results with the least possible cost.
  o Sizzle: the result of the four previous Ss will lead directly to the sizzle goal which is the
    reputation and building of the brand by making Couchsurfing experience memorable and
    unforgettable with the customers, which leads to the user-generated content on the
    social media platforms and E-Word of Mouth.
Our digital marketing objectives reside in the following:

    1. Increase Web Traffic by 50% by 2022.
A study conducted by Couchsurfing shows that the growth in Travel and Tourism is increasing
rapidly in Asia Pacific (China, India, Thailand), the Middle East (UAE, Pakistan,) and some parts of
Africa (Morocco, Egypt, Tunisia). While maintaining the level of marketing efforts in the existing
countries of interests like the USA and Europe, much of our marketing efforts will be channeled
to growing Couchsurfing awareness in these emerging countries with travel growth potentials.
The current average monthly traffic on Couchsurfing’s website is 8M, and this will anticipate to
develop to 12M in the next four years (Travel and Tourism, 2017).

     2. Increase yearly active users (hosts and guests together) by 25% by 2022.
The yearly active users of Couchsurfing as at 2017-year end was 4.4M members. We hope to
grow the number of yearly active users to 5.5M in the next four years. To achieve this website
visitors’ conversion rate, a strategy of engaging web visitors will be formulated. Currently,
Couchsurfing gets an average of 8M visits each month, and this is anticipated to climb to 12M
visits per month in 2022. In a period of four years, the target is to convert 1.1M of the anticipated
4M new visits within the same period to become active users of Couchsurfing (Couchsurfing,
2018).

    3. Increase the verification rates by 40% in the next four years.
In the next four years, we hope to grow the number of verified users of Couchsurfing services by
40%. The number of yearly active users of Couchsurfing is projected to grow from 4.4M to 5.5M
active members. From the anticipated new active users of 1.1M members in the next four years,
Couchsurfing hopes to get 211, 200 verified. To achieve the verification growth rate,
Couchsurfing will offer a verified member fee waiver for the following year if he/she is able to
host 20 guests within a period of one year. At the end of 2022, the number of verified users will
grow from its current figure of 528,000 to 739,200 (Couchsurfing, 2018).

KPIs Identification
Digital Marketing Key Performance Indicators (KPIs) are tools that assist an organisation or a
marketer to trail and gauge how successful its (his/her) digital marketing efforts are. Key
performance Indicators (KPIs) are ‘sign-posts’ used by Digital Marketers to determine what
objectives or goals are relevant to achieving overall business objectives, and gauge their
marketing activities to know if those set goals are being achieved or not (Saura et al 2017.)
The critical aspect of setting digital marketing KPIs for me, is deciding on the relevant
performance indicators compute that will have bearing on the organisation’s overall digital
marketing goals (Smart Insights, 2018). For KPIs to be relevant in measuring performance, it must
be:
1. Well-defined: Well-defined Key Performance Indicators (KPIs) are rallying point for all
concerned with measuring the successful attainment of the set digital marketing goals of the
organisation. Just like objectives, KPIs that are vague and not well defined become confusing and
difficult to use.

2. Quantifiable: A key Performance Indicator must be based on an objective that is measurable
because if it is not quantifiable, an organisations’ performance measuring tool will be faulty and
as such, can never generate the right gage for performance.

3. Crucial: There are lots of different KPIs to choose from, as such, an organisation should choose
KPIs that are very relevant to its digital marketing goals. If a KPI is not crucial or very relevant to
the success of your digital marketing goals of your business, it should not be used to measure
performance.

4. Relevant: Furthermore, to being crucial, Key Performance Indicators (KPIs) must also be of
relevance to your organisation’s digital marketing performance objectives. Your Key Performance
Indicator should measure the direct efforts or your digital marketing campaigns (Pro. Koivumaki,
2018 Slide:22.), (Chaffey & Bosomworth 2013.)

The completion of digital marketing measurement process gives room for an organisation to
adjust its online activities to improve performance. In my opinion, the use of KPIs to measure
digital marketing efforts of an organisation is closely related to Murdough’s (2009) social media
measurement process that consists of Concept, Definition, Design, Deployment and
Optimisation.

                                   KPIs for Couchsurfing

1. Web traffic sources: This KPI measures the percent of one kind of the traffic sources that
   are driving visitors to website, and provides a comparison of each of those sources.
       o Direct traffic: Visitors that visit site by typing the URL into their browser, or
           through an undefined channel.
       o Referral traffic: Visitors that visit site by clicking on a URL on another website.
       o Organic Search traffic: Visitors that discover the website by entering searching a
           keyword in a search engine (like Google) and that click on the listing (Kilpfolio)
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