Airbnb and Its Impact on the Hotel Industry
1. Outline and evaluate the success of Airbnb, highlighting its impact, if any, on the Hotel industry
The concept of Airbnb (use of sharing economy)
The successful example of online market place Airbnb, Inc, that has its headquarters in San Francisco, California, United States and it was opened in 2008, which means, that the company that operates a little over than 10 years already, is an example of business who does not even own real estate listings and does not host events, is an example for all businesses related with excellent tourism sector. “Airbnb is an online marketplace for vacation rentals that connects users with property to rent with users looking to rent space” (Airbnb, 2019). It is a prosperous platform with use of shared economy offering great travel experiences and alternatives for hotels and it can create new tourism concepts and develop new habits of traveling.
It is known that the new age sharing economy has innovative technology that makes it as a critical component that facilitates sharing. Airbnb does not own any rooms or properties in more than 192 countries around the world. However, it is all because of the use of technologies that strongly beneficiate to this company allowing the company establish platforms that exist in marketplace. Environmental pressures, economic realities, values shift, and technology innovations are main factors that contribute to the growth of sharing economy. Airbnb primary source of revenue comes from service fees obtained from bookings and the company has been fortunate to avoid many rental and hotel tax laws in many countries. The principle of this enterprise is letting unacquainted people who become its customers to rent out their unoccupied rooms or even the whole properties, Airbnb service has many similarities to those used by hotels when renting their homes. Guests who are visiting places around the world and require a short-term quite often prefer Airbnb services over usual hotels. The reason is that Airbnb provides stay for travellers who seek less expensive travel experience. Without owning a single hotel, Airbnb was able to grow up and progress rapidly surpassing well - known hotel chains such Hilton and Marriot over the last year.
(Colliers International, 2018)
The 21st century's economic model sharing economy is described as a peer-to-peer (P2P) operates by two individuals communication to acquire or sell goods, and services without interaction of the third party, allowing them to communicate directly and without a use of any other enterprise of business. This model is widely applied by "Uber" and Airbnb as well. A peer-to-peer (P2P) based activity beneficiates through social networks such: online platforms Facebook, Messenger, WhatsApp and others, ensuring a secure direct payment method for transactions and provides its customers "neighbourhoods” service which acts as a guide to the locality quite often, directly meeti
