The rapid growth of services like Uber and Airbnb over the last decade make it clear that the "sharing economy" is not a passing trend. This has provided business travellers with a viable option beyond the usual taxi and hotel combo. However, there are still some areas of these services that require consieration. Here's an overview of what businesses need to know.
A recent report published by the Grattan Institute urged state and federal governments to regulate sharing economy suppliers, with competition, consumer and tax policies. This shift in the market has caught the attention of many traditional travel suppliers, with its potential to impact pricing and regulation. Recent analysis of the global sharing economy as part of a CWT Solution Group’s sharing economy whitepaper uncovered some surprising statistics, particularly when looking at Airbnb use in Australia:
- 5.2% of business travel stays in Sydney were in Airbnb accommodation, more than double the global average.
- Travellers stayed at Airbnb accommodation for four more days on average than hotels or serviced apartments.
- Average paid rates at Airbnb were 25% lower than traditional accommodation suppliers.
Globally, the use of sharing economy suppliers still represents a relatively small portion of most managed corporate travel programs. That said, companies are beginning to realise that some of their travellers are probably already using these services, and more companies are exploring ways to bring sharing economy services into their managed travel programs.
While use of services like Airbnb and Uber is no doubt on an upwards trend, there are a number of things business travellers should consider before committing to a sharing economy business trip.
The sharing economy provides an undeniable opportunity for travel savings, particularly for longer stays.
#2 You get what you pay for
While services like Airbnb provide opportunities for savings, traditional suppliers like hotels and serviced apartments offer a high degree of consistency in service across their properties. They also provide greater assurances around safety, traveller tracking and integrated distribution and booking channels, which are important to many business travellers.
#3 Supply and demand
In cities where hotels and serviced apartments are in short supply – Melbourne during the Australian open tennis tournament, for example – sharing economy players like Airbnb can help you find a bed at a reasonable cost.
#4 Make sure it’s legal
There are still challenges surrounding the validity or legality of sharing economy suppliers in some markets. In Australia, for example, the NSW government is reviewing laws around short-term leasing. Similarly, the ACT and NSW governments have legalised and introduced regulations around ride-sharing services like Uber, and other states are following suit. As such, opportunities to work with these suppliers definitely exist, but it’s still a challenge to develop a consistent shared economy policy across multiple markets.
#5 Is it a good fit for your company?
Companies like Airbnb and Uber may be right for some companies and their travellers, but may not be right for others. Whether or not the sharing economy is a good fit for a given company will depend on their company culture, their appetite for something new, and their risk management policies, among other things.
Lisa Akeroyd, managing director of CWT, Australia and New Zealand. Akshay Kapoor, director of CWT Solutions Group, Asia Pacific.