trip planning and decision making process Case of AirBnB

41 Pages·2016·0.96 MB·English

AALBORG UNIVERSITY
CULTURE COMMUNICATION AND GLOBALIZATION
Master Thesis

Pre – trip planning and decision making process
Case of AirBnB

Master Degree in
Culture, Communication and Globalization
Market communication and consumption

Author/s: Karolina Fetingyte
Assignment: Master thesis
Supervisors: Karina M. Smed

Characters: 103 360
Submitted: 31 May 2016
Abstract

The development of information technologies has brought new travelling concepts on the
market. Automatically the tourism industry is affected by this revolution of technology and
both tourism destinations and enterprises have to adopt all innovative methods in order to
enhance their competitiveness among others. One of them is AirBnB. This is a collaborative
consumption concept of accommodation where private people are encouraged to share
their properties with tourists. Therefore, the focus in this study will be only on the pre-trip
planning process.

Hence, the objective of this research is to explore and understand how tourists acquire
knowledge in pre-trip planning stage in order to book an accommodation through AirBnB
and what kind of influence it gives to their decision making process. Therefore, the purpose
of this study is the understanding of pre-trip planning of tourists, who has an access to
AirBnB, and how they choose the accommodation by using all the sources. This will help to
further understand the complex process of decision making process which is influenced by
the new Information technologies.

During thematic analysis of seven in – depth – interviews with tourists who have been using
AirBnB services, it appeared that there are four major factors tha is influencing these
tourists desicion making process in the pre – trip planning stage. The influential factors are
the following: socio-economic, concept, purpose of the trip and personal characteristics.
Previous researches have also emphasized on the frist three influential factors and they are
stated in the theoretical framework of this study. However, the final influential factor was
constructed to the findings only during the process of thematic analysis.

Due to the fact that the study was based on qualitative data and only seven interviewees
participated in data collection process, there is no possibility to generate more specific and
concrete findings that could be adapted to the majority of the tourists. However, the
findings and the information that was gathered during the process of this study can show
valuable confirmations in regards to the decision making process that is under the influence
of the development of information technologies.
Table of Contents

1. Introduction ........................................................................................................................... 1
2. Theoretical Framework .......................................................................................................... 4
2.1. Consumer Behavior ......................................................................................................... 5
2.2. Tourism Product .............................................................................................................. 8
2.3. Information Search ....................................................................................................... 10
2.4. Decision Making Process ............................................................................................... 14
3. Methodology ........................................................................................................................ 16
3.1. Philosophy of Science ................................................................................................... 16
3.2. Ontology ........................................................................................................................ 17
3.3. Epistemology ................................................................................................................. 18
3.4. Methods ........................................................................................................................ 19
3.5. Data Collection .............................................................................................................. 20
3.6. Data Analysis ................................................................................................................. 23
4. Findings ................................................................................................................................ 25
4.1. Socio-economic influence ............................................................................................. 27
4.2. Concept ......................................................................................................................... 29
4.3. Purpose of the trip ........................................................................................................ 30
4.4. Personal characteristics ................................................................................................ 32
4.5. Discussion ...................................................................................................................... 34
5. Conclusion ............................................................................................................................ 34

Bibliography ................................................................................................................................ i
Appendix 1: Interview guide ....................................................................................................... i
Appendix 2: Example of interview transcript ............................................................................ ii
1. Introduction

Traveling has been playing an important role in people’s lives since as long as we can
remember. From the times when traveling meant exploring the world in the ancient times
looking for new lands and cultures until now when people travel for their leisure time,
business meetings and education. Currently, travel and tourism are taking one of the
highest priorities of world's industries and has an important economic impact on the global
as well as on the local level (Werthner and Klein, 1999). As well as other industries, tourism
is developing very fast and new trends are being applied in order to improve the availability
of information and tourism products as accommodation, different activities and etc.
In this industry, knowledge is factor of quality of the travelling experience, therefore
information search is one of the crucial steps when tourists start planning, booking and
being on vocation (Steinbauer and Werthner, 2007, p. 65-76). During the last few years,
Information Technologies (IT) has been strongly affected by changes and especially the
Internet. It became accessible to most of the people due to several factors like becoming
smaller, portable, easier to handle and generated various functions. The current hardware,
software and network are developed with a high degree of innovation and even though all
technologies are becoming more powerful and complicated, the final product is becoming
more user-friendly and less expensive to consumers. Therefore, this enables more
consumers both in Business to Business and Business to Consumer to take advantage of the
new technologies. Tourist rely on various websites and mobile applications to plan their
holidays and organizations in this industry relies on the new technologies to communicate
their message and reach tourist through as many channels as they can in order to market
their products and build the relationship with current and potential customers (Poon 1993).
Therefore, the Internet became one of the most effective and efficient ways for tourist to
seek information, plan and book all the products they need for their vocations. (Werhner
and Klein, 1999).
If we look back to information search process, people always had different channels and
they tent to use a combination of several information sources in order to plan their trips and
make decisions (Snepenger, 1990). Therefore, the trip planning process can start from
talking with family or friends, reading various literature, consulting with travel centers and
travel agents (Kendall and Booms, 1989). Hence, it can be argued that multiple tourism
information sources were used during the process of decision making in travelling. During
the last few years, this rather static way of trip planning have changed due to the new
technologies wich opened up more dynamic possibilities and tourist do not need to rely on
other people to plan their trips.
Automatically the tourism industry is affected by this revolution of technology and both
tourism destinations and enterprises have to adopt all innovative methods in order to
enhance their competitiveness among others. If looking to the demand side – travelers –
become familiar with the new technologies very fast. These consumers are knowledgeable
and demanding all about the new ways of searching for information. It has to be fast and
easy. Therefore, companies have to put great effort to be on point and catch the
consumer’s eye at the right time in order to get his attention.
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As one of the technological outcomes the new phenomenon has emerged – sharing
economy. Currently, this phenomenon has several names, such as “collaborative
consumption, “product-service systems” or “access-based consumption” (Bardhi and
Eckhardt, 2012; Molt, 2002; Botsman and Rogers, 2010). According to Rachel Botsman, who
together with her co-writer, Roo Rogers popularized sharing economy with the book
“What’s mine is yours” (2010),” the space is getting blurry and the definitions are being bent
out of shape to suit different purposes”. Further, Botsman (2010) argues that some of the
definitions might have different meanings as “collaborative economy” is just an overall
term, and it can be defined as an economy which is build on distribution of networks that
are connected by various individuals or communities in opposition to centralized
institutions. This transforms production, consumption, financing and learning.
“Collaborative consumption” could be seen as a sub-category or an economic model which
is based on sharing, swapping, trading or renting products and services.
Further, Belk (2014) has another, easier definition, which is able to sum up the whole
essence of this rising new phenomenon: “collaborative consumption is people coordinating
the acquisition and distribution of a resource for a fee or other compensation” and the
ground that “collaborative consumption” is able to occupy is rather a middle ground in
between of sharing and creating a market place.
The attention of consumer researchers to several groups of businesses and consumption
practices of “collaborative consumption” corresponds to the rise of for-profit and non-profit
businesses that are booming and all thanks to the rise of this phenomenon. As an example
of businesses that fit the description of “collaborative consumption” are AirBnB, YouTube,
Facebook, Uber and Twitter. In a broad perspective, the Internet itself might be defined as a
place filled with shared content that could be accessed by anybody in any place of the world
who has the Internet connection.
Therefore, in order to be more specific about what “collaborative consumption” actually is,
there is a necessity first to dismiss two miss-specifications. Felson and Speath (1978) define
collaborative consumption as “those events in which one or more persons consume
economic goods or services in the process of engaging in joint activities with one or more
others”. This could include examples of speaking on the telephone or drinking beer with
friends.
When going back to tourism industry, “collaborative consumption” is starting to adopt both
for-profit and non-profit organizations and it is currently spreading all around the world.
Specifically in this industry, “collaborative consumption” is flourishing and companies like
AirBnB, Homeaway and Uber are developing scalable business models and platforms that
empowers private people to distribute and share the access of accommodation or
transportation with others. However, in this study I will focus only on one “collaborative
consumption” concept - AirBnB as a tourism product - accommodation.
The beginning of this significant transformation in the tourism accommodation sector
started in 2007, San Francisco. It all started from an idea of two recent graduates to create a
simple website to advertise their apartment because a huge conference was held in town
and there was a great demand of accommodation. The website was names as “AirBed and
Breakfast” and it promoted their apartment. After it was a success, they felt that a great
business idea is in front of them and decided to recruit another friend in order to turn a
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website into a service for more people who wants to advertise their apartment or rooms for
tourists. Since 2007, AiBnB has grown extremely fast and now is booking millions of rooms
or apartment all around the world (Botsman and Rogers, 2010). Still, AirBnB as business
concept is relatively new and there is a lack of academic research done about this
phenomenon which is increasing its significant service. However, given its potential,
Airbnb’s rise is of great significance for the traditional tourism accommodation sector and
opens up new travel planning options for consumers. Tourists have new and more dynamic
platforms to choose their accommodation which can be placed in any part of the city or
region. This kind of concept opens up more possibilities to experience something new every
time.
All the new technologies have created these latest concepts of accommodation and
expanded the ways of how people search for information. Therefore, the information search
process is representing initial steps in the decision making process for the most of the
travelers (Molina and Esteban, 2006). This has an important role when it comes to the
influential factors for tourists’ purchases, decisions and behavior. Now people have even
more ways of where to look for information, how to look it and when to make a final
decision. As it is relatively new concept, marketers need to know how consumers find
information now in order to be in those places at the right time.
In this study, the focus will be on the pre-trip planning stage. It is a very complex process
requiring travelers identify, filter, evaluate and select a massive amount information
(Fesenmaier and Jeng, 2000) in order to develop a travel plan and specifically in this study -
choose the accommodation. The understanding of pre-trip planning of tourists, who has an
access to AirBnB, and how they choose the accommodation by using all the sources, will
help to further understand the complex process of decision making process which is
influenced by the new Information Technologies. It could be argued that travelling stages
cannot be separated and has to be analyzed together, however, I believe that in this case,
when the accommodation issue is being analyzed, the greater importance is only on the pre
– trip planning. This is the stage where people decide and usually purchases the
accommodation.
Hence, the following problem statement that will be studied in this thesis is:
How the accessibility of Airbnb in influencing tourists’ decision making in the pre-trip
planning process when purchasing accommodation?
Therefore, the objective of the study is to explore and understand how tourists acquire
knowledge in pre-trip planning stage in order to book an accommodation through AirBnB
and what kind of influence it gives to their decision making process. Therefore, the purpose
of this study is exploratory and designed to investigate and generate a new level of
understanding about relatively new phenomenon.

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2. Theoretical Framework

In order to understand the impact that accessibility of Airbnb has to pre-trip travel planning
process in this chapter I discuss various studies and theories relevant to the topic which are
providing a framework for data collection and analysis. Therefore, the question is: which
theories should be included in order to answer all the questions of this study. As Costley
(2006) stated “a theory is an orderly, integrated set of statements that describes, explains
and predicts behavior”. The theories that are chosen in this study not only guide the
research (for ex. Interview questioner) it is also easier for me as a researcher to keep
focused and stay on the right path while conducting the further parts of the study.
Moreover, the framework helps me to have information about the topic, what is already
known and what are the further possibilities that could be explored. Therefore, theoretical
framework could be explained as a lens which gives the meaning to what we see (Costley,
2006).
The theoretical framework of this thesis is used for its descriptive and explanatory function
and variety of studies and theories have been used to grasp the complex process of
consumer travel behavior and decision making process in the stage of pre – trip planning.
The main perspective of the theoretical framework is based on the concept of consumer
behavior in tourism and will be as a connecting link in the further studies and theories.
There will be three other branches out from the consumer behavior that are closely related
1) tourism product; 2) information search; 3) decision making process.
All these topics together should provide a framework that gives me a deeper understanding
about the research topic. The following figure illustrates the main parts and their interaction
with each other.

Figure 1. Theoretical framework

Consumer
Behavior
Desicion
Tourism
Making
Product
Process
Information
Search

Source: Own production

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2.1. Consumer Behavior

In the current times, we can see a lot of changes and especially in the new emerging
technologies such as Internet. Therefore, the methods and tools of doing business are
changing. One could argue that currently the Internet could be considered as one of the
technologies which have the biggest influential impact to the consumers’ behavior. Hence,
this is making it a crucial factor when it comes to understanding of consumers’ behavior and
new perceptions. It is needed in order to first recognize, then captive and finally retain the
customer in the internet based businesses in the travel industry. Therefore, in this study I
focus on analyzing the factors which are influencing the consumer behavior while making
decision about their travel accommodation choices.
When looking into relationship between online tourism services and consumer behavior,
previous studies have conducted theories that are basically developed in order to have a
better understanding of consumer’s decisions and behavior. They all have the same goal to
find out the main principles that guides consumers’ behavior and help to follow those
practical implementations. All of it is done in order to give advices and create predictions of
the influences that are caused in consumers’ behavior (Kroeber-Riel & Weinberg, 1999).
After looking into consumers’ behavior in tourism, it could be seen that electronic
distribution of tourism related information has a huge impact on consumers’ behavior.
Currently, a lot of tourists are using websites, applications and other tools in order to collect
information and purchase various services that are offered in online tourism industry
(Nedelea & Alina 2010).
According to Solomon (1996), consumer behavior involves certain decisions, ideas, activities
or even experiences that might satisfy their needs and wishes. In other words it could be
said that consumer behavior is “concerned with all activities directly involved in obtaining,
consuming and disposing of products and services, including the decision processes that
precede and follow these actions” (Engel, Blackwell, & Miniard, 1995, p. 4). Therefore, it is
clear that consumer behavior is covering a lot of ground and it is a process that involves
individuals who buys and uses various products and services in order to satisfy their needs
and desires (Solomon, 1996). It is complicated processes and it is even harder to uncover
consumers’ behavior in a complex industry such as tourism.
There were many models and theories developed since 1965 that analyzes all the steps that
consumers are making in tourism industry. One of the earliest models of consumer behavior
in tourism was proposed by Andreason (1965). His model highlights the importance of
information in the consumer decision making process. In addition to this, it also recognizes
the importance of consumer attitudes even though it fails to consider attitudes in relation to
the repeat purchases in consumer behavior.
When looking into other consumer behavior theories in tourism, one of the most often
mentioned is the Howard-Sheth (1969) model of buying behavior. The main features of this
model is that it emphasize on the significance of inputs to the consumer buying process and
suggests ways in which consumers orders these inputs even before making the last decision.
However, as no model or theory is perfect, there is some criticism to this model too. This
model does not elaborate on all buyer behavior.
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Therefore, most of the recognized models of consumer behavior in tourism are relatively old
and based on old – fashioned ways of travelling; in this case some adaptations will be done
in this study. In order to collect and analyze data, I will focus on the model of Travel –
Buying – Behavior by Mathieson and Wall (1982). These authors suggested a five-stage
linear buying behavior model. It allows seeing consumer behavior activities that can allow
me to see each step of the process.
Figure 2. Travel – Buying – Behavior model

Source: Mathieson and Wall, 1982
When looking into the figure, we can see all five stages of typical buying process in tourism.
It is believed that consumer passes all five different stages beginning with a desire to travel
and ending with the travel outcomes. As it can be seen in this model, the buying process
starts much earlier than the actual purchase and has influence and consequences
afterwards (Kotler, 2000, p.178.) In this study only the processes involving pre- trip travel
behavior will be analyzed in the process of data collection and analyses as the purpose of
the study is to find out the influence of Airbnb to tourist pre-trip planning process.
Therefore, I believe that it is important as a researcher to understand all parts of the theory
in order be able to produce qualitative interviews and analyze the data collected.
Further, I would like to discuss aspects of all five stages of the model, however only the first
four stages (Felt need/travel desire, Information collection and evaluation image and Travel
decision, travel preparation) will have a deeper use in this study.
1) Felt need/travel desire
The buying process starts when the consumer recognizes a problem or a need. The need can
be triggered by internal and external factors and from this point a consumer starts its
travelling planning process.
2) Information collection and evaluation image
When the consumer becomes interested and feels the need to travel, the information
search about the product such as destination or plane tickets starts. In this stage, two types
of arousals can be separated: 1) heightened attention and 2) active information search. At
the first stage a person is becoming more open to information about the product he or she
is interested and at the second stage a consumer is interested in gathering all information
possible about that product.

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Therefore, the information sources have an influence to the final purchase decision. Kotler
(2000) argues that these information sources can fall under four groups: personal (friends,
family etc); commercial (agents, advertising etc); public (media, review sites etc) and
experiential (former use of the product, examining the product etc.) The amount and
characteristics of the sources used relies on the personal characteristics of consumer and
the type of tourism product.
3) Travel decision/choice between alternatives
This stage is the most complicated and there is no specific process that would apply to all
consumers in the purchasing situations. It could be said that there are several stages that
are considered in decision making. First, the consumer wants to satisfy his/her need and
then secondly, he/she is looking for a concrete benefit from the product solution. Then the
consumer is able to see various attributes in different products that would be able to deliver
that he/she is looking for. All those factors might vary and it depends on the product. For
example when the consumer considers hotels, the decision factors might include location,
price, atmosphere (Kotler, 2000, p.180).
4) Travel preparation/travel
This stage includes the rest of the preparation work needed in order to take the trip such as
visa arrangements, packing, and information approval about the destination like weather
conditions and etc. However, the amount of time that has to be invested in this stage of the
planning might vary depending on the several factors like type of destination, how
experienced the person is, how long the trip will last (Kotler, 2000, p.181).
5) Travel satisfaction and outcome
The final stage is after the person has purchased the product and is able to evaluate how
satisfied or dissatisfied he/she is. Therefore, marketers have a possibility to evaluate the
customers’ actions after the purchase and the post purchase use of the product and the
marketers’ job is not finished after the product is sold (Kotler, 2000).
However, in this study I am focusing all the attention to the pre-trip planning stages (the
first four stages of the model) due to the fact that I want to investigate the influence of
Airbnb accessibility to tourists’ decision making process. In addition to this, I am aware that
the model was conducted before the new technologies such as Internet had an impact on
travel behavior, and I will see if there are any inconsistencies or the model is also suitable
with new ways of travelling.
As travel planning is a specific type of consumer information search and can be considered a
fundamental component of trip experience in that a traveler often needs to obtain a
substantial amount of information in order to develop a travel plan. It can be seen in various
researches that pre-trip planning process helps people to make decisions and therefore
build expectations for their travels (Gretzel et al., 2006; March and Woodside 2005). In
addition to this, these researches are indicating that the information that is available to
individual travelers actually has a major impact on different aspects of the decision making
process. (Gursoy and McCleary 2004; Bieger and Laesser 2004).

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