One of the main topics at this year’s ITB is the 'Sharing Economy' and the pressing question: Is it just a temporary trend and limited to niche segments or are we experiencing a paradigm change in global tourism?
What is behind the disruptive business models like Airbnb and Uber that the sharing economy created? Are they here to stay?
“It’s safe to say that in terms of scope and impact, the sharing economy has arrived,” said April Rinne, sharing economy advisor at the ITB on Wednesday. “And it looks like it’s here to stay.”
Sharing economy boom
The market of the sharing economy is booming. In 2013, more than US$3.5 billion of venture funding was invested in sharing economy businesses, according to Rinne. In 2014, investments tripled almost and reached an estimated US$10 billion.
In terms of the number of rooms offered, Airbnb, the most famous sharing economy business, has managed to do what Hilton Hotels & Resorts did in 93 years, said Rinne. And BlaBlaCar, the long distance ridesharing service, is moving more people than the high-speed railway service Eurostar at less than 1% of the costs, she added.
Airbnb, Uber and BlaBlaCar have become successful because of the sharing economy idea. But do a few successful examples make for a paradigm change? According to Rinne, other megatrends are pointing towards a change.
Signs for paradigm change
Smartphones already widely available and key for a sharing economy model, will be basic equipment for 90% of the global population over the age of six in a few years’ time, believes the sharing economy advisor.
“Digital natives will become an increasingly large group of the travelling populations and they are already incorporating the sharing economy principles,” said Rinne.
Demographic change means the population is getting older. More and more pensioners will have time to travel but have a limited budget. Airbnb’s largest demographic group is already older people and the number will grow, according to Rinne.
People will become geographically more flexible and business travel will increase, she argued. Currently, there are more than 1.2 billion mobile workers. In the US, a third of the entire workforce is freelancing. By 2020 this number will rise to 40%, with Europe not far behind, she said.
“People will be able to work from anywhere,” said Rinne.
But the biggest current megatrend is urbanization. More than half of the global population lives in cities. By 2050, three out of four people will live in urban areas.
This is an important indicator for a paradigm change because the sharing economy is mostly taking place in urban areas where resources need to be used more efficiently.
Major cities like Amsterdam, Seoul and Sydney have already applied the sharing city concepts and are experiencing the positive effects of it. “It’s better for locals and better for tourists because it means less congestion, more community and less isolation,” said Rinne.
The signs are pointing towards a paradigm change, said Rinne. “Cars, telephones and ATMS were all first highly disruptive to our way of living,” said Rinne. “But now we can’t imagine a life without it.” And it looks like the same applies to the sharing economy.
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