Peer to Peer Accommodation Networks : An Examination

296 Pages·2017·3.32 MB·English

by  Sara Dolnicar

15mm
R8 PB FINAL ARTWORK
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2 The Sharing Economy 1
PEER-TO-PEER P Sara Dolnicar
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E
ACCOMMODATION
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T PEER-TO-PEER
NETWORKS
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Peer-to-peer accommodation networks are pushing boundaries we did not even know existed.
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These networks have rocked the established accommodation sector, dramatically increasing the
E ACCOMMODATION
variety of accommodation options available to people around the world.
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Peer-to-Peer Accommodation Networks: Pushing the boundaries is the first book to provide an

in-depth analysis of the business model of Airbnb, to discuss factors facilitating the transition A
of peer-to-peer networks from niche market to mainstream accommodation providers, and to C
predict that the next step of development for peer-to-peer accommodation networks will be to C NETWORKS
become online one-stop travel shops. Many other hot topics around peer-to-peer accommodation O
are discussed. M
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Using her first-hand experience as a host on both traditional holiday accommodation webpages
and peer-to-peer accommodation networks, respected tourism academic Sara Dolnicar and O
her fellow contributors examine possible reasons for the explosive success of peer-to-peer
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accommodation networks, investigate topics relating to peer-to-peer network accommodation
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which are less frequently discussed (such as charitable activities and social activism), and offer a
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future research agenda.
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Peer-to-Peer Accommodation Networks: Pushing the boundaries discusses a wealth of issues
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including:

• Factors that drive the success of peer-to-peer accommodation networks;
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• Regulations put in place at different destinations around the world to benefit from peer-to-peer
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accommodation while minimizing negative side-effects;
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• The potential of peer-to-peer accommodation networks to increase accommodation capacity
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with a click of a button, which can help fill infrastructure gaps, facilitate events, and give shelter
to people if a disaster strikes; O
• Types of guest and hosts on peer-to-peer accommodation networks, and the social conventions R
that regulate their interactions; K
• Who genuine peer-to-peer accommodation networks members are, what motivates tourists S
to use peer-to-peer accommodation, and the chance of a ‘perfect match’;
• Pricing, discrimination, stimulation of entrepreneurship, and consequences for employment in
the hospitality sector. D
o
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Sara Dolnicar PhD, is the Research Professor in Tourism at UQ Business School at The University of n
Queensland in Brisbane, Australia. ic
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Pushing the boundaries
Goodfellow Publishers Limited
Oxford, UK.
www.goodfellowpublishers.com
Peer-to-Peer
Accommodation
Networks:
Pushing the boundaries
Sara Dolnicar
( )
G Goodfellow Publishers Ltd
( ) Published by Goodfellow Publishers Limited,
G
26 Home Close, Wolvercote, Oxford OX2 8PS
http://www.goodfellowpublishers.com
British Library Cataloguing in Publication Data: a catalogue record for this
title is available from the British Library.
Library of Congress Catalog Card Number: on file.
DOI 10.23912/9781911396512-3454
e ISBN 978-1-91196-53-6
Paperback ISBN: 978-1-911396-52-9
Hardback ISBN: 978-1-911396-51-2
Copyright © Sara Dolnicar, 2018
All rights reserved. The text of this publication, or any part thereof, may not
be reproduced or transmitted in any form or by any means, electronic or
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Copyright Licensing Agency Limited, of Saffron House, 6–10 Kirby Street,
London EC1N 8TS.
Open access:
Except where otherwise noted, this work is licensed under
a Creative Commons Attribution 3.0 Unported License.
To view a copy of this license, visit http://creativecommons.org/licenses/by/3.0
All trademarks used herein are the property of their repective owners, The
use of trademarks or brand names in this text does not imply any affiliation
with or endorsement of this book by such owners.
Typesetting by D.S. Pears, Hampshire
Cover design by Cylinder
Illustrations by Peta Hewitt
Contents
1 Unique Features of Peer-to-Peer Accommodation Networks 1
Sara Dolnicar
2 The Sharing Economy 15
Stephan Reinhold and Sara Dolnicar
3 Airbnb’s Business Model 27
Stephan Reinhold and Sara Dolnicar
4 How Airbnb Creates Value 39
Stephan Reinhold and Sara Dolnicar
5 How Airbnb Captures and Disseminates Value 54
Stephan Reinhold and Sara Dolnicar
6 Airbnb and its Competitors 63
Homa Hajibaba and Sara Dolnicar
7 Entrepreneurship Opportunities 77
Marianna Sigala and Sara Dolnicar
8 Networks Becoming One-stop Travel Shops 87
Sarah Gardiner and Sara Dolnicar
9 Filling Infrastructure Gaps 98
Ljubica Knezevic Cvelbar and Sara Dolnicar
10 Supporting Events 109
Sheranne Fairley and Sara Dolnicar
11 Regulatory Reactions Around the World 120
Homa Hajibaba and Sara Dolnicar
12 Drivers of Price in City Destinations: Vienna 137
Bernhard Andreas Hrobath, Friedrich Leisch and Sara Dolnicar
iv Peer-to-Peer Accommodation Networks
13 Networks in China 148
Yixiao Xiang and Sara Dolnicar
14 The Impact on Employment 160
Gabor Forgacs and Sara Dolnicar
15 Types of Network Members 170
Anne Hardy and Sara Dolnicar
16 Networks and Hosts – a Love-Hate Relationship 182
Anne Hardy and Sara Dolnicar
17 Socializing New Guests 194
Sara Dolnicar
18 The Multi-Family Travel Market 206
Homa Hajibaba and Sara Dolnicar
19 Do Hosts Discriminate? 216
Homa Hajibaba and Sara Dolnicar
20 Communication-Regulated Social Systems 226
Denise Lawungkurr Goodfellow, Anne Hardy and Sara Dolnicar
21 Helping when Disaster Hits 237
Homa Hajibaba and Sara Dolnicar
22 Guests with Disabilities 246
Melanie Randle and Sara Dolnicar
23 Political Activism 257
Homa Hajibaba and Sara Dolnicar
24 Environmental Sustainability 267
Emil Juvan, Homa Hajibaba and Sara Dolnicar
Index 279
v
Contributors
Sara Dolnicar, Department of Tourism, UQ Business School, The University of
Queensland, Australia
Ljubica Knezevic Cvelbar, Faculty of Economics, University of Ljubljana,
Slovenia
Sheranne Fairley, Department of Tourism, UQ Business School, The University
of Queensland, Australia
Gabor Forgacs, Ted Rogers School of Hospitality and Tourism Management,
Ryerson University, Canada
Sarah Gardiner, Department of Tourism, Sport and Hotel Management,
Griffith Business School, Griffith University, Australia
Homa Hajibaba, Department of Tourism, UQ Business School, The University
of Queensland, Australia
Anne Hardy, Tasmanian School of Economics and Business, University of
Tasmania, Australia
Bernhard Andreas Hrobath, Institute of Applied Statistics and Computing,
University of Natural Resources and Life Sciences, Austria
Emil Juvan, Faculty of Tourism Studies Turistica, University of Primorska,
Slovenia
Denise Lawungkurr Goodfellow, Thompson-Nganjmirra Family
Friedrich Leisch, Institute of Applied Statistics and Computing, University of
Natural Resources and Life Sciences, Austria
Melanie Randle, School of Management, Operations and Marketing, Faculty
of Business, University of Wollongong, Australia
Stephan Reinhold, Research Center for Tourism and Transport (T&T IMP-
HSG), the University of St. Gallen, Switzerland
Marianna Sigala, School of Management, University of South Australia,
Australia
Yixiao Xiang, Department of Tourism Management, School of Management,
Shandong University, China
vi Peer-to-Peer Accommodation Networks
Foreword
Spending a month each Christmas with my parents-in-law has proven to be
challenging over the years. My husband and I have two little children, who
– like most children – are delightful, but do love to run around, make a mess
and scream with excitement. And my in-laws live in a pretty compact house.
Wandering along a lovely beachside suburb close by, we noticed how many
houses were available for holiday rental. We saw a lovely house for sale. We
bought it, after having established that we could cover the operating costs by
renting it out as a holiday home, although we understood that we would not
earn enough to repay the mortgage from rental income. This is how – after
20 years of being a tourism researcher – I became a tourism accommodation
provider.
It has been a truly fascinating experience, because I managed to make every
possible mistake, proving to myself that theory is great, but practice is a whole
different kettle of fish. Some of my mistakes came at a high price. One day I
found ten doonas (duvets) dripping wet on the clothesline. I did not need to
know why they were dripping. But I had no option but to throw them away and
buy new ones. Some of my mistakes came at a high emotional cost. I accepted
a booking by a family with two children. Shortly after check-in, the neighbors
had to call the police because the ‘family’ turned out to be a large group of
young adults who arrived equipped with a huge stereo.
With every mistake I made, my academic fascination grew. Years after we
had bought our beach shack, Airbnb entered the market. I signed up, expecting
it would be just another website enabling me to find customers at my own
risk charging an outrageously high commission. Soon it became obvious that
this was not the case. This new website – which I knew absolutely nothing
about – allowed me to learn much more about my guests; allowed me to assess
the risk of each booking much more effectively; offered me a guarantee; offered
my guests a guarantee; and charged a substantially lower commission. It also
wanted me to socialize with my guests (which I refused to do) and forced me to
make decisions about accepting or rejecting booking requests within 24 hours
(which I felt was rather unreasonable, especially when I found myself wrestling
the kids for the full 48 hours of a weekend).
Through my personal fascination with renting out our beach shack using
both conventional booking sites and peer-to-peer accommodation networks,
I developed a research interest in the topic. Every additional good and bad
experience became scientifically interesting. Every year, Airbnb launched new
initiatives that further fuelled my fascination. Airbnb started providing pric-
Foreword vii
ing advice; providing advice on the length of bookings; offering adventures;
opening spaces to people in need when natural disasters hit; listing entire
countries (such as Sweden); and engaging in political activism such as the wide
distribution of the acceptance ring in support of marriage equality. Peer-to-
peer networks are not just another accommodation provider, and they are not
just another distribution channel. They are a powerful amplifier for business
transactions and ideas.
The realisation that I was sharing my fascination about peer-to-peer accom-
modation networks with many of my colleagues from all over the world and
across a range of disciplines led to the idea to write a book which would allow
us to present interesting perspectives in a truly collaborative way. Some of my
co-authors I knew well, some I have never met. Our collaborative approach to
book writing stands in stark contrast to traditional academic writing, just as
peer-to-peer accommodation networks stand in stark contrast to the traditional
tourist accommodation sector. The process of co-creating this book was a truly
enjoyable one, which many of us found very liberating in times where journal
expectations and reviewer opinions dictate the nature of our research. It also
led to many new insights as we all learned from one another and built on one
another’s ideas.
Our primary aim is to share with readers our fascination with peer-to-peer
accommodation networks; to point to the many perspectives on these networks
which are rarely discussed; and, most importantly, to inspire others to push the
boundaries of research into the phenomenon of peer-to-peer accommodation
networks, just as the networks are pushing the boundaries of tourism as we
know it.
Sara Dolnicar
Brisbane, 2017
viii Peer-to-Peer Accommodation Networks
Introduction
Not in our wildest dreams would we have imagined, a decade ago, that pro-
viders of short-term accommodation would regularly refuse to sell rooms to
tourists despite having a vacancy; that thousands of tourists and residents
displaced due to a cyclone or an earthquake would be offered emergency
accommodation in people’s homes at no cost, with one click of a button; that
tourist accommodation would compete with residential rental properties to the
point of pushing residents out of their own cities; or that facilitators of online
trading platforms would use their direct access to millions of people around
the globe to push for societal changes, such as marriage equality. The effects
of peer-to-peer accommodation networks entering the hospitality sector have
surpassed our wildest dreams. Peer-to-peer accommodation networks are
pushing boundaries we did not even know existed.
Peer-to-peer accommodation networks push boundaries because they are
different. Different from other accommodation providers. Different from other
online travel agents. Chapter 1 provides insight – from a network member’s
perspective – into the many small differences that make successful peer-to-peer
accommodation networks unique. Chapter 2 discusses whether peer-to-peer
accommodation networks are part of the sharing economy, concluding that
a clear verdict is not possible because of the substantial variation across peer-
to-peer accommodation networks. Labeling peer-to-peer accommodation
networks as part of the sharing economy is certainly not helpful in under-
standing what makes them so powerful. Rather, the answer to this question
lies in their business model. We therefore dedicate three chapters (Chapters 3,
4 and 5) to the in-depth analysis of Airbnb’s business model. We have chosen
Airbnb because business models vary across networks, and because Airbnb is
currently the market leader among commercial peer-to-peer accommodation
network internationally.
Chapter 6 looks beyond Airbnb, providing an overview of other networks
and highlighting the existential need for networks to have a critical mass of
buyers and sellers. Currently, only two online travel agents that have extended
their offerings to spaces rented out by ‘ordinary people’, and one non-commer-
cial peer-to-peer accommodation network have the required critical mass to
compete internationally. The situation is quite different in China, where local
accommodation networks dominate the market (Chapter 13).
The transformative power of peer-to-peer accommodation networks affects
hospitality, the tourism industry and society as a whole. At the level of the
hospitality sector, countless entrepreneurial opportunities associated directly
Introduction ix
or indirectly with peer-to-peer networks are emerging: every host is a micro-
entrepreneur, often outsourcing support services to other entrepreneurs. We
analyze entrepreneurship opportunities in Chapter 7. Flow-on effects from
these opportunities on permanent employment in the hospitality sector are
discussed in Chapter 14: while peer-to-peer accommodation networks offer
many new flexible ways of earning an income, they also put pressure on the
established accommodation sector. This pressure may lead to closures and the
need to keep operating costs low. In both cases, a likely consequence is the
reduction of permanent employment opportunities.
The tourism industry more generally can benefit from one unique feature
of peer-to-peer accommodation networks: their ability to activate – in a few
seconds with only the click of one button – thousands of rooms. Temporary
expansion of accommodation capacity is critical for destinations hosting
international mega-events or small regional events (Chapter 10). Expansion of
accommodation more broadly can also assist regions and nations – such as
Slovenia (Chapter 9) – which are experiencing increasing tourism demand
while facing a shortage of accommodation infrastructure to support the growth
of their tourism industry. The ease at which space can be made available to
tourists comes at a risk: the reallocation of houses, units and rooms from the
long-term rental market to the – more profitable – short-term rental market. In
many places around the world, such reallocation has exacerbated pre-existing
challenges in housing markets. In some instances, residents have found them-
selves priced out of living in their own cities. Chapter 11 provides an overview
of how policy makers around the world have addressed these challenges.
Exploring the inner workings of peer-to-peer accommodation networks,
Chapter 15 develops typologies of prototypical hosts and guests based on driv-
ers of their engagement in network trading. Their relationship with platform
facilitators such as Airbnb further differentiates hosts. Chapter 16 illustrates
that relationships can vary from indifference to love and hate. Emotions run
particularly high among pioneers of peer-to-peer network hosting, who are
noticing with dismay that the nature of trading on such networks is changing.
From a tourist perspective, peer-to-peer accommodation networks enable
genuine micro-segmentation. Accommodation offers are not developed to sat-
isfy the average member of an artificially created market segment. Rather, these
networks list thousands of spaces, each of which is unique, allowing guests
to find accommodation most suitable to them. Typical commercial accom-
modation providers are like supermarkets offering a selection of standardized
products. Peer-to-peer accommodation networks are like bazaars; part of the
fun is the browsing, the process of shopping for accommodation itself. Micro-
segmentation also offers opportunities for specific groups of tourists, including