#gagtc15 from airbnb to uber – what you need to know about shared travel services alisha...
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#GaGTC15#GaGTC15
From Airbnb to Uber – What You Need to Know about Shared Travel Services
Alisha Valentine, Strategic Marketing & Research Insights,
and Bridget Lidy, City of Savannah
The Case Against the Sharing Economy, Susie Cagle, The Nib, May 2014
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The Case Against the Sharing Economy, Susie Cagle, The Nib, May 2014
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The “Gig” Economy
The sharing economy (sometimes also referred to as the peer-to-peer or P2P economy, mesh,
collaborative economy, collaborative consumption) is a
socio-economic system built around the sharing of human and physical resources.
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Tipping Point
In 2013, just 45% of overnight travel trips were spent in a hotel, a tipping point in the
lodging industry.
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Hotels Call Them …
STORMS:Short Term Online
Rental Marketplaces
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A Changing Landscape
Old Model• Companies will deliver• I want security, and I’ll pay
for it• Comfort with brands• I buy from companies
whose policies I value
New Model• I trust crowd sourcing• I want unique and
affordable, and I’ll risk it.• Loyalty to “local”• I like people whose values I
value and who value me
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“We’re moving from a world organized around ownership to one organized around access to assets.”
– Lisa Gansky, Early Share Software Developer
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• Millennials will outspend their boomer parents in travel by the year 2017.
Source: Women’s Wear Daily and Berglass + Associates Study, 2013
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Studies show:
Know the Terminology
• “Neo-Sharers” (16%) – have used at least one “emergent” sharing service in the last year (including sites like Etsy)
• “Re-Sharers” (23%) – those who “buy and/or sell pre-owned goods” (sites such as eBay) but who have not graduated to neo-sharer status
• “Non-Sharers” (60%) – those yet to participate, but many of whom indicate wanting to try
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• 23% of U.S. population• 48% ages 18-34 – Millennials• 27% married• 62% homeowners• 49% incomes less than $50k• 35% of neo-sharers, however,
have incomes of greater than $100k – more than twice as likely as non-sharers
Source: Vision Critical’s Voice of Market Studies 2013-2014, 90,000 participants ages 18 and older
Who shares?
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• Boomers, empty-nested and down-sized from their jobs or wanting to supplement their retirement income are also turning to vacation home rentals as a means of income.
What about the Boomers?
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• 74% of Boomers and 72% of GenXers now use shared services, just slightly less than the 80% of Millennials.
Not just for Millennials
• Ride-sharing reasons differ by age, with some citing safety and cashless payment options as primary reasons for using services like Uber.
• 79 percent% like not having to pay their driver directly and feel safer since the app identifies the driver and handles payment.
Source: MMGY Portrait of the American Traveler, 2015
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• 47% Word of Mouth• 13% Social Networks • 16% Traditional Marketing
• Search – 16%• Media – 8%• Online Ads – 7%
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How discovered?
Tourism-Related Sharing Examples
TRANSPORTATION• Lyft• Uber• BlaBla Car• Hail• Sidecar• DriveNow• ParkAtMyHouse
LODGING• Airbnb• HomeAway• CouchSurfing• VRBO (Vacation Rentals by
Owners)• House Trip• CouchHomeSurfing
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Tourism-Related Sharing Examples
DINING• LeLoca (sells unused seats in restaurants with food discounts)• Cookening (eat with a local)• EatWith (eat like a local)• EatWithMe (shared food events)• Munchery (San Francisco food delivery by chefs)• Gobble (dinner kits)• Underground Restaurants (large urban areas)
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Tourism-Related Sharing Examples
TRAVEL – OTHER• Vayable (authentic tour experiences by locals)• Concur (travel operator-like services, expense monitoring)• Tours by Locals (private tour guides)• Roads Scholars (small group tours with intimate in-home
experiences, i.e., dinners with artists)
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Continually Evolving Marketplace• ZipCar, the world’s
largest car sharing network, started in 2000. Now, there are nearly 1 million members and 10,000 vehicles.
• Indianapolis is launching BlueIndy, partially subsidized by government funding. Positioned as an alternative for residents but an amenity for travelers. Charging/rental stations positioned in key tourist spots – airport, downtown, etc.
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Proponents Argue
• These “micro-jobs” are part of a “second economy,” providing additional money into the pipeline in an otherwise stagnant wage economy.
• More than half of money earned is defined as “new money,” or resources beyond paying the bills, re-fueling extra spending like travel.
• Shared economy lodging participants tend to spend more and stay longer than traditional visitors.
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Opponents Argue
• It’s highly unregulated and potentially unsafe.• It’s unfair to companies that spend money on licenses and
comply with governmental requirements such as inspections, fees and lodging taxes.
• For some markets, e.g., conventions, booking outside the block is unfair to its group organizers’ meeting minimums.
• Neighbors are starting to balk at strangers staying in their residential communities.
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Brian Chesky, Founder Airbnb
http://thecolbertreport.cc.com/guests/brian-chesky/ddvyto/brian-chesky
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Situation Analysis
• New York is fighting Airbnb to gain access to its host records, suspecting some are in violation of law, generating a huge point/counterpoint ad campaign
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• Airbnb states on its website to its hosts that it should check into local laws regarding lodging taxes and remit those, or ask their customers to remit those in person; in some cases, it has negotiated to collect and remit those on behalf of the host.
Practical Application
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Situation Analysis
• In San Francisco, owners are kicking out their regular tenants to run 100% transient lodging operations. Current law allows rentals of 90 days if owner not present. Proposition F slated for a November vote.
• More and more, “big business” is moving in on the “shared economy” under the subtext of individual owners, skirting local regulations, taxes and fees
• Portland authorized Airbnb rentals so long as lodging taxes are collected
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Situation Analysis
• Airbnb collecting for lodging taxes for 12 local U.S. municipalities.
• Collecting sales tax for the state of North Carolina.
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How many Airbnbs do you have?
Georgia Total – 3,100+
• Atlanta = 1,000+• Savannah = 518• Augusta = 233
(Average rate $423)
• Athens = 225• Columbus = 15
Competitors• Charleston = 816• Hilton Head = 572• Myrtle Beach = 370 • Jacksonville = 295• Birmingham = 66
Average rate: $132
<$65/night: 691$65 -$100: 949
$100-150/night: 624$150-$250: 468
>$250: 430
Bills to be heard January 2016 in SC legislature
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Airbnb to continue growth in cities
10%• HomeAway Model
introduced 2014• Favorable to large
property managers
3%• Airbnb host fee
attractive to single owners and smaller managers
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Already a significant part of demand
• Airbnb is 5.4% of lodging in NYC, up from 3.1% the previous year.
• For a small bureau, 5% could be $1.5 million in gross sales and $75,000 in lodging taxes.
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New
York
Cit
y R
oom
Nig
hts
–
Apri
l’1
3-1
4
30.9 million in hotels
1.8 million in Airbnb
#GaGTC15
Regulating Short-term Vacation Rentals
Bridget LidyTourism Management & Ambassadorship
City of Savannah
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Existing Lodging Accommodations
• Bed and Breakfast Guest Unit:– Rental of one bedroom in an owner-
occupied residence to travelers for less than 30 days
• Inns:– Shall contain not more than 15
bedrooms or suites; may serve meals; provided such services are limited to guests occupying rooms within the inn
• What about entire dwelling units?
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Local Concerns
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Quality of life
Neighborhood integrity
Fairness within the industry
Renter safety
Zoning regulations
Zoning Text Amendment
Amended zoning code to include short-term residential rentals: • Create and define the use:
– Entire residential dwelling unit is rented for lodging – Rental not more than 30 consecutive days– May or may not have an on-site manager– Includes all housing types – Does not include group living or other lodging use
• Established zoning districts where permitted and restrictions
• Maximum number of occupants • No change in the exterior appearance or
other visible evidence of rental
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New Regulation
• Establish certification process:– Application– Business Acceptance Approval– Code compliance verification– Exemplar agreement – Proof of ownership & insurance– Annual fee
• Define responsibilities of rental agent• Provide process to address violations • Obtain Business Tax Certificate &
remit hotel-motel tax
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56
(21%
)
128(49%)
77(30%
)
Property OwnersManagement Com-panies Independent agent
Ownership: 68% reside in Chatham County 32% reside outside Chatham County
Types of Management Jan 1-Apr 15, 2015
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1 bedroom
2 bedrooms
3 bedrooms
4 bedrooms
5 bedrooms
6 bedrooms
7 bedrooms
0
10
20
30
40
50
60
70
52
70
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2 1 3
# of Bedrooms per STVR1st Quarter 2015
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0 1 to 3 4+0
102030405060708090
88 86
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STVR Parking Spaces1st Quarter 2015
# of Parking Spaces per STVR
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STVRs Bed and Breakfast Guest Units
Inns0
10
20
30
40
50
60
70
80
59
22
15 4
1
105
1
74
31
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ZONING ENFORCEMENT since May 2014
In ComplianceIn CourtActiveTotal
108 lodging accommodations cases with 82 in compliance
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HOW DO WE MEASURE THIS MARKET IMPACT?
Community Conversation
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Who here has included “shared economy” questions in market research?
• If yes, how?• If no, how do we do it?
QUESTION 1:
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Interest in Shared Economy
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Dec. 2014 Visit California Tracker 2014 Visit California ROI, Jan. 2015
TNC STORM0%
5%
10%
15%
20%
25%
30%
35%
40%
5% 5%
11% 11%
20% 21%
Likelihood to Use Shared Economy Resources
Very likely Somewhat likely Might or might not TNC STORM
6.0%
0.5%
Shared Economy Usage on 2014 California Trips
How do destination marketers manage the positioning and marketing of this new economy?
• Do we ignore?• Do we engage and promote?
QUESTION 2:
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Get ahead of a potential problem
• Bureau in Indiana considering a policy to begin collecting from 30+ shared home rentals, primarily Airbnb. Working with the county to utilize current statute and Dept. of Revenue reporting.
• Grew from 6 to 30+ in 3 months. Wanted to have policy in place before it got too big.
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30 properties
2 rooms each
Small,
limited
service
hotel
With OTAs and social media assuming the role of the destination marketer, and one more layer between product and promotions, what’s next?
QUESTION 3:
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