Analysis of Hospitality in Sharing Economy-Samples for Students

Question: Anayse Hospitality in Sharing Economy. Answer: Introduction Sharing economy is a term which can be used to describe various economic activities related to online transactions. The sharing economy deals with growing out of the open-source community to refer to the peer-to-peer based sharing of the access to services and goods. This term can also be used for the purpose of describing the sales transactions that are done through the online market area. This is an economic model which can be defined as the peer-to-peer based activity related to acquiring of goods, providing the goods and sharing the access to these services and goods which is facilitated by an online platform which is community based (Cohen and Sundararajan 2015). Sharing economy can also be termed as collaborative consumption which is a trending concept in business. This concept mainly highlights the abilities of the individuals to borrow or rent goods instead of owning or buying them. Benefits and the reasons for motivating tourists related to usage of sharing economy Sharing economy has become the latest trend in the technology world and it has influenced all the major sectors and industries. The hotel and hospitality industry has been greatly influenced by the sharing economy concept. This concept is mainly a socio-economic economic system which is built around sharing of physical and human related resources. This includes the shared creation, distribution and the production of goods in the market. This is related to the ability of the consumers or the firms in granting temporary access to each other to the physical assets which are under-utilized in nature (Cusumano 2015). The entities belonging to the sharing economy shared the goods which are unused with the with the others in the market for short or longer periods of time. The travel industry and the hoteliers have been affected by the concept of sharing economy. The process of sharing by the various entities like, the hosts who provide the list of their unused rooms or the hosts who are permanently away from their homes have posed a threat to the hotel industry. The hoteliers therefore come together to provide alternate accommodation related facilities in the sharing economy. The sharing economy has been watched by the hoteliers quite closely and they are also planning to offer shared rooms for the travellers who seek different experience in their tours (Ert, Fleischer and Magen 2016). The hotels which are a part of the entire sharing economy related concept include, HomeAway, HomeToGo, Vacations Rentals By Owner (VRBO), FlipKey, Couchsurfing and Airbnb. These organizations have put immense pressure on the operations of traditional hotels. The hotels which provide limited services or select services cater to the business clients. The sharing economy is constantly changing the ways by which think about travelling and reserving their accommodations. The hotels are therefore trying hard to understand the behaviour of the travellers who prefer to make their accommodation and bookings in the shared economy sector (Gursoy 2017). Airbnb is the largest operator in the new concept of shared economy that is used by the travellers to book their accommodations. The travellers who use the services provided by the accommodation facilities in sharing economy include those who desire for more social interactions with the local residents and have unique experiences in the authentic hotel settings. This provides them with the reason to travel more and stay longer in the hotels. The major drivers which affect peer-to-peer accommodation related facilities are the active usage of internet, the age of customers, the availability of technologies and the frequency of their international travel (Hamari, Sjklint and Ukkonen 2016). The development of sharing economy has been able to shake up the hotel industry. The transactions related to shared economy occur directly between the private people and the major hotel brands in the distinctive hospitality industry. The hoteliers are trying to capture the opportunities and the challenges that are being faced by the marketplace due to the advent sharing economy. The conventional experience provided by the hospitality industry have been challenged and are being tested in ways which were not imagined before. The hotels which are technologically advanced and can understand the importance related to guest experience, this opportunity can help them in increasing their revenues and profitability (Interian 2016). The hoteliers therefore need to use this opportunity so that they are able to meet the services related to localization that are provided to the guests. The hoteliers can gain competitive advantage in the industry not only by providing the best rates, they also nee d to understand the minds of the customers. The sharing economy is likely to rise its opportunities in the future in the hospitality industry. This will present many challenges for the other commercial hotels in the market, which will put immense pressure on these hotels to maintain their profitable operations (Lu and Kandampully 2016). Hospitality experience provided by sharing economy The hospitality experience that is provided by the sharing accommodations are authentic in nature as the travellers can live in the hotels like the locals. The consumers have also started demanding experiences where they are able to interact with the locals of that area and live in the hotels like the locals do. These demands have impacted the services that are offered by the shared accommodation providers. The travellers have constantly started demanding for the authentic services which can make them feel like they are part of the place where they have visited. This further tends to increase their time of stay and they begin to mix with the local culture of the area (Matzler, Veider and Kathan 2015). The three major themes that have been given importance by the providers of shared accommodation services are, unique accommodation and interiors, interaction with the hosts, and the interactions with the local culture of the area. The travel experience has been made much more meaningful after the introduction of this concept of accommodation. The peer-to-peer style of accommodation impacts the behaviour of the travellers as well. The major impacts of this process of accommodation are related to increase in travel frequency, expansion in the selection of destination and the increase in the length of stay as well (Mittendorf and Ostermann 2017). The social interactions of the travellers have become more meaningful in nature and reduction of costs related to accommodation have allowed the travellers to consider those destinations which they were not able to afford before. On the other hand, the commercial hotels are unable these social interactions and experiences to the travellers. The travellers who avail the services of commercial hotels are not always able to afford to travel select destinations due to the costs that are associated with the stay in these hotels. The local experience and feel that is provided by the peer-to-peer services are also not available in case of the commercial hotels. This is the main reason due to which it can be stated the commercial hotels are unable to provide authentic experience to the travellers as compared to the peer-to-peer hotel accommodations (Mody 2016). The main customer sector of the commercial hotels are the business travellers. The reason being that these travellers do not intend to extend their stay or have local experience of the area. However, the providers of home sharing networks are trying to capture this market in the near future. This can be a major threat to the operations of the hospitality indus try. The commercial hotels are now trying to capture the market by expanding their portfolios in various other areas and they are further introducing designs that can appeal to the various types of travellers (Mhlmann 2015). The commercial hotels have been compelled to changes their style of business to compete to the peer-to-peer hotel industry. The working environment in the hotels are being changed and the managers can now interact the guests in a casual manner. For example Hyatt Hotels and Resorts have taken these steps with the help of their new brand Hyatt Centric where the approaches related room service have been changed (Oskam and Boswijk 2016). The guests can order their food from the restaurants present within the hotels or the local restaurants and get it delivered in their rooms. This has helped the organization in providing facilities to the guests related to interaction with locals and taking advantage of the local cuisine as well. The interactions of the hotel staff and the guests are now much more natural as compared to the previous times (Scholz 2016). Types of hotels affected by the sharing economy The rise of shared accommodation related facilities in the Asia Pacific region has posed a threat on the commercial hotel industry. The major services providers in this industry who have an impact on the operations of the commercial hotel organizations are, Airbnb, FlipKey, HomeAway, Rommorama. The main advantage of these service providers is the low price that they are able to provide to the travellers and the guests (Schor 2016). The research has identified that the price of accommodation that is provided by shared services is 200% lower as compared to the commercial hotels in cities like, Jakarta, Shenzhen, Ho Chi Minh, Guangzhou, Manila and Jakarta. This has led to the decline in the sales of these hotels as the travellers prefer to use the shared services due to its low cost option. The commercial properties in New York and San Francisco are also facing the same issues due to the rise of shared economy (Schor and Fitzmaurice 2015). The lodging market has faced major changes after the advent of organizations like, Airbnb. The commercial hotels have been earning huge margins in their charges related to the rooms provided to the travellers. The main revenue of these hotels were earned during the time of festivals. The companies like Airbnb have provided many options for travellers who visit the areas the time if festivals so that they can plan their holidays in a more effective manner. The levels of competition between the traditional hotels and Airbnb have increased heavily (Zervas, Proserpio and Byers 2017). The traditional organizations therefore need to put more focus on the care that they are providing to the guests and finding out ways to extend their stay as well. The hotel industry needs to adapt to the changing needs of the consumers and try to enhance their stay in the hotels as well. The collaboration between the members of the team is important for the purpose of providing the best services to the gues ts. The increase in communication levels of the employees in the five star hotels can help in enhancing their profits. Debate on the response of three-star hotel in Adelaide to sharing economy The three-star hotel that is considered in the analysis is The Chifley on South Terrace. This is a hotel which is located in the heart of Adelaide. The organization aims at providing the right balance of comfort and convenience to the guests. The hotel is located in a favourable area where the various commercial areas of the city are located within a short distance. The commercial areas include, Victoria Square, Adelaide Central Market, South Parklands. The hotel provides all the modern amenities to the guests which include, cable programming, Wi-Fi, minibars and the facilities related to effective room service as well (Oskam and Boswijk 2016). The hotel provides high quality levels to the guests and they try to provide their services with respect to their needs. The hotel is located in the heart of the main city of Adelaide and the dining facilities are provided in their sister concern which is not quite far away. The organization provides various offers and facilities to the guests in the season time and at the time of various festivals. The hotel provides many offers which are customised according to the needs of the guests (Scholz 2016). The rooms of the hotel are packed with all the modern amenities that are required for the purpose of a comfortable and luxurious stay. The various types of rooms include from family rooms to deluxe rooms. The rooms also supply high-speed internet services for the convenience of the guests. The different types of levels include, deluxe room, standard twin, executive king, studio queen, junior suite, parklane suite and family room (Chifley on South Terrace, Adelaide 2018). The sales of the hotel have however been affected by the advent of the sharing accommodation related services that are provided by the organizations like, Airbnb. The rates of the various rooms in the hotel are quite high as has been depicted in the website. The luxury class and rates of the various services that are provided by the hotel are the major reasons behind the drop of revenues after the advent of shared accommodation. The guests will be attracted towards the services that are provided by the shared accommodation organizations as the rates are low (Schor 2016). This will have a negative impact on the sales of the hotel and the ways by which they can increase their revenues. The steps that can be taken by the organization to increase their sales and to compete with the organizations providing shared accommodation are related to changes that can be made in the strategies. The rates of the rooms and other amenities provided to the guests need to be lowered so that the hotel can attract more number of guests. The distribution related activities of the hotel can also be improved so that they can provide faster services to the guests. The hotel can attract guests with the help of special packages provided according to their preferences (Hamari, Sjklint and Ukkonen 2016). The management of the hotel needs to create an environment in the hotel where the guests can interact with the local residents of the area. The guests also need to have access to the local cuisine and food as well. The local food items need to be included in the menu of the hotel and the guests can be delivered the food to their respective rooms. The staff need to be trained so that they can interact openly with the guests and provide an atmosphere which is friendly in nature. In this manner, Chifley Hotels can create a competitive position in the industry. They will further be able to ma intain their profitable operations in the industry (Mody 2016). Conclusion The essay can be concluded by stating that the sharing economy and its various aspects have affected the sales and revenue of the commercial hotels. The hotel and hospitality industry has been under immense pressure after the advent of the sharing accommodation related services provided various organizations like Airbnb. The commercial hotels have however started devising strategies which can be helpful for the competition that they can provide to these accommodation services. The homely atmosphere, local interaction and the low costs provided by the sharing accommodation related organization have impacted the revenues of the commercial hotels. These services also need to be provided by the commercial hotels so that they can provide best services to the guests with low margins and rates. References Chifley on South Terrace, Adelaide. (2018).Rooms - Chifley on South Terrace, Adelaide. [online] Available at: https://www.nexthotels.com/chifley/south-terrace-adelaide/rooms/ [Accessed 27 Mar. 2018]. Cohen, M. and Sundararajan, A., 2015. Self-regulation and innovation in the peer-to-peer sharing economy.U. Chi. L. Rev. Dialogue,82, p.116. Cusumano, M.A., 2015. How traditional firms must compete in the sharing economy.Communications of the ACM,58(1), pp.32-34. Ert, E., Fleischer, A. and Magen, N., 2016. 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