Airbnb, the home sharing site that says you can “Belong Anywhere,” is suffering! They have now launched legal action against San Francisco over a new law that would require it to delist hosts who have not registered their living spaces. Furthermore, New York could ban Airbnb users hiring out apartments.
Recently, though, Airbnb have also been caught up in a wave of claims that its independent hosts discriminate based on race.
Numerous guests who have tried to book accommodations have told stories of being rejected by hosts because of their race, spawning a hashtag #AirbnbWhileBlack. A North Carolina host made a racist post and was banned from the site, and a discrimination lawsuit is pending in federal court. Airbnb officials recently scheduled a meeting with civil rights leaders to seek input on dealing with the discrimination issue.
This is the dark side of the sharing economy, where savvy entrepreneurs can set up a website and interface that makes it easy for anyone to find and do business with individual property owners and independent contractors. For transportation, we have Uber and Lyft. For accommodations, there’s Airbnb and VRBO. There’s Taskrabbit for chores and errands, and UpWork for freelancers.
In theory, the sharing economy can reduce discrimination because transactions take place at an arm’s-length. And that’s been largely true of Uber, where initial anonymity has eliminated the discrimination that many black people feel when hailing a cab.
Airbnb has taken a different approach, however, requiring users to post a profile picture and allowing hosts and guests to “vet” each other before doing business together. In theory, this sounds like a good idea that will lead to a more personalized and satisfying experience for everyone. In practice, it becomes shockingly easy for hosts to discriminate.
In a study released in January, Harvard researchers found that Airbnb guests with distinctively African-American names were 16 percent less likely to be accepted than identical guests with distinctively white names. They found discrimination among both white and black hosts and across a diverse mix of property types and locations. And they found that hosts rejected African-American guests even if it meant that the property would be unoccupied for the weekend in question.
At the root of the discrimination are the conscious and unconscious biases and prejudices that we all have. These biases are the result of our background, upbringing and life experiences. They can take the form of explicit racism, but many times these biases influence our actions without us realizing it.
Hotels must follow antidiscrimination laws, and sites like Priceline.com or Booking.com prevent discrimination through policies that say they must rent accommodations to anyone with a valid credit card.
For a company like Airbnb, an anti-discrimination policy only goes so far. Eliminating actual discrimination is difficult when individual property owners– each with their own set of biases — have discretion about who they can rent to.
As the sharing economy grows (and there’s no reason to think it won’t), more and more businesses are going to struggle with how to regulate their clients and contractors to ensure that discrimination doesn’t occur.
In my opinion, Uber is on the right track, and its anonymity will help it avoid the discrimination claims and public relations nightmare that has engulfed AirBnB (though Uber does have other issues).
Sharing economy entrepreneurs would be well advised to pay attention to the potential for both conscious and subconscious biases among their clients and contractors. For example, sharing economy companies could conduct customer mirrors where consultants pose as customers of various races, genders and sexual orientations to identify the specific points in the customer journey where discrimination or disparate treatment occurs. From there, they can adjust their way of doing business to minimize the opportunities for discrimination.
Does the sharing economy prevent discrimination, or make it easier to discriminate? Share your ideas in the comments section below.
Are you one of the 58% of businesses that now look to digital to help them sell profitably? If so, Register now for my next webinar: 5 Steps For An Effective, Customer Centric, Digital Transformation.
If you enjoyed this post you may also find the following articles interesting:
How To Measure Customer Emotions
The Emotional Experience: Shedding Some Light On Emotions
Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of five bestselling books and an engaging keynote speaker.
Follow Colin Shaw on Twitter & Periscope @ColinShaw_CX