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Topic 4 Strategies for integrating Collaborative Consumption as an opportunity for value creation

The disruption of the tourism sector by CC companies and the consumer behavioural shift (supported by the development of CC practices) towards personalised experiences imply serious ramification for the traditional industry who is pushed to reinvent itself and mould its offers. This emerging phenomenon does not mean that incumbents actors are not relevant anymore. As sharing platforms are available for them as much as for individuals, traditional players in the tourism industry could embrace the opportunity to use and/ or integrate the best of CC and benefit from it, instead of dedicating their energy to ignore its existence or discredit its value. In that perspective, four strategies describe how the traditional sector can benefit from becoming an actor of CC:

1.List your inventory on sharing platforms

The sharing platforms are becoming the reference for travellers to book tourism activities. Incumbents can take turn this trend into an opportunity to multiply their reach and bookings by being present on these platforms. With the little strategy effort of listing their inventory (hotel rooms, cars, etc.) on the platforms, Incumbent actors of the tourism industries might adapt their business infrastructure and become CC consumers.

For instance, several hotels have indicated to the Hotel Tech Report that up to 15% of their bookings was made via Airbnb.

2. Participate in CC

The traditional industry might join the CC economy to extend its offer by integrating it. This can be done for instance by offering hourly rates for hotel rooms (which could also become workspaces) or rental cars, or by providing hotel guests with bicycle rental services.

Hotels might also decide to participate in the home sharing business, leveraging their experienced and professional staff, by offering professional services to homeowners involved in home sharing. Check-in check-out, cleaning, maintenance and repairs are all services that hotels deal with daily. They could offer to provide these services to short-term renters who want to avoid doing these time-consuming services themselves or to pay expensive third-party contractors to do it.

It is in that perspective that Marriott, a large hotel group, has partnered with Hostmaker, a property management company, and launched in 2018 the Tribute Portfolio Homes, a home-sharing platform. The Accor hotel group also entered the home-sharing business by acquiring onefinestay, a high-end home sharing platform, in 2016.

Source: https://www.brandchannel.com/2018/04/23/marriott_takes_on_airbnb/

3. Partner with CC actors

Incumbent actors who cannot afford, financially or organisationally, to develop their own digital platforms and/ or offer new services aligned with CC can combine their existing offers with sharing services through partnerships. An already well-implemented example, especially in the context of the lockdown due to COVID, is the partnership of a growing number of restaurants with platforms offering a delivery service performed by independent contractors. Another example is the partnership between Hilton Worldwide and Uber which allows Hilton customers to request and book directly via the Hilton app Uber rides to and from the hotel. This partnership began in 2016 in USA and expanded in 2020 in Australia. You can read here the announcement of the partnership.

A partnership with sharing platforms such as Peerby might also contribute to provide tourist with objects that are needed temporarily and/ or in specific destinations, allowing them to travel light from one destination to another. These can include for instance tents, bicycles, hairdryers, beach accessories or skis.

4. Collaborate and partner with local actors

It was explained that digital platforms are a key but non-essential actor. CC activities do not always require going through data and online platforms. Organisations in the tourism industry and beyond can collaborate and pool their activities in order to extend their offers and services and then their customer base. One example is the partnership between a hotel and a nearby bicycle store who would offer bicycle rental services for the customers of the hotel during their stay.

The initial beer example illustrated how organising conjointly the purchase of goods and services with other players who need them too can lead to costs reduction as they are divided between each involved actor. Indeed, every actor in the tourism industry, but also beyond, has its own specificities and style but their requirements in terms of products and services are often very similar. Collaboration and coordination with other actors bring then the opportunity to operate collective buying which can offer several advantages such as lower price (quantity discounts) and acquisition costs reduction, and contribute to reducing transport pollution.

Source: krakenimages¬†–¬†Unsplash.

Become a consumer of CC

Incumbent actors of the tourism industries might adapt their business infrastructure and become consumers of CC offers. They can operate a shift from owning to accessing temporarily machinery and tools needed, either from individuals by benefiting from sharing platforms as much as private individuals do, or from fellow companies (or another department of the company) by creating business-to-business and/ or internal sharing platforms. This might also imply replacing permanent labour with on-demand labour (performed by independent contractors) in the case of services.