What’s alternative is becoming the new normal
05 FEBRUARY 2016 7:16 AM
Alternative-accommodations companies aren’t going away—they’re becoming more popular—so hoteliers should get ready.
The data discussed in a recent Phocuswright webinar on the sharing economy’s impact on travel should come as no surprise to anyone: It’s becoming more mainstream, and not just with millennials.
The percentage of U.S. travelers who stayed in a private accommodation on a leisure trip rose from 1 in 10 in 2011 to 1 in 4 by 2014, according to Douglas Quinby, VP of research for Phocuswright. He also said one of the fastest growing age groups for the rental marketplace isn’t millennials, but travelers age 35 to 44.
“There’s been a huge jump the last couple of years,” he said. “There’s some pretty significant growth, not just among millennials, but across older travelers as well. HomeAway and Airbnb—the millennial brand is becoming more mainstream.”
It makes a lot of sense when you think about it. The alternative accommodation companies have been around for a number of years now. As should be obvious from the terminology, they provide an alternative to the hotels and motels travelers have traditionally used, potentially offering lower prices, a more organically local experience or, for some, just something different.
Without any major scandals or horror stories gone viral, the companies have gained credibility with the demographic groups that were likely wary of them when they started. The initial ick factor of staying in somebody else’s home has ebbed away to perhaps being an exciting adventure or at least a cheaper place to stay in an otherwise expensive area.
Now, alternative accommodations, which come in many different forms, are by no means perfect. There are safety, tax and other regulatory issues to work through that would help level the playing field some and better protect guests staying at hosts’ houses or apartments, but that’s not my point here.
Even if there are insurance requirements, safety standards and comparable tax rates established for companies like Airbnb and HomeAway, they will continue to exist, in some form or another, and they’ll probably do pretty well for the reasons I mentioned before.
There are studies, analyses and reports coming out on a regular basis trying to determine whether alternative accommodations are true competitors of hotels and, if so, whether they are hurting hotels. Some hotel company CEOs say they aren’t concerned, that they aren’t competing for the same guests, while others are exploring options similar to the sharing economy.
So what does that mean for the hotel industry? If I could predict the future, I’d have hoteliers, along with everyone else, lined up around the block waiting to talk to me. Instead, let’s try working through it this way.
There’s always going to be another company doing something a bit different, changing things up for the hotel industry. In all likelihood, the best approach to these will simply be to be flexible. Sure, that’s easier said than done, but what other approach is going to work better?
Be flexible. If it’s not Airbnb, it’s going to be somebody else. See what is working for them, what’s drawing guests to them. Can you do something similar, something better? Can you work with them rather than against them? Can you become a disruptor yourself?
There are a lot of options out there for hoteliers, some probably not even thought of yet. That’s OK. There’s time for trial and error because alternative accommodations aren’t going anywhere.
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