The Sharing Economy: How Do I Trust Thee?
By Janet Gerhard Partner & CXO, Inquizo | October 18, 2015
Its most basic definition, trust (noun) is the "firm belief in the reliability, truth, ability, or strength of someone or something." Look at the hotel industry. Inherently, there has to be a high level of trust in the guest-hotel relationship. After all, there aren't many other industries that involve you getting naked to experience their products and services.
But, according to the most recent AP-GfK General Social Survey, American's trust in each other has diminished…potentially irrevocably. Down from 50% in 1972 to only 1/3 of Americans stating that most people can be trusted in 2014. What? How is that possible? Isn't the entire premise of a shared economy built on trust?
Indeed trust is foundational to any brand. Does the product or service do what it says it is supposed to do? Do I trust that if something were to go wrong the brand would correct it? In our industry, most hotel brands garner trust. It's what gives one an advantage over others. More often than not though, they're also seen as indistinguishable and conformist especially within their respective segments. It's rare in our industry for a brand to achieve an emotional connection (dare I say love) with our guests.
Look at J.D. Power's most recent results from its North America Hotel Satisfaction Index. Hotel satisfaction is up across the board, but there is only one true standout in the dozens of brands measured. Reliability may be terrific in many circumstances, but it doesn't scream experiential. And whereas we spent the last two decades striving for uniformity, our customers have changed and their expectations go beyond the amenities we tout.
Travelers today are looking for authentic experiences. According to the latest consumer trends survey by JWT Intelligence, a marketing research firm, 73% of respondents said they would rather spend money on an experience than on a material item. And a desire for authenticity is leading customers to look for experiences that go beyond the cookie cutter. As Ann Mack, director of trendspotting, for JWT Intelligence, tells Travel Market Report, "People are looking for experiences that aren't too perfect. Some may prefer to stay in someone's home, rather than in a chain hotel. Or they're doing things like touring New York's Lower East Side with a graffiti artist – and doing some graffiti."
Which is where the peer-to-peer accommodations are winning. In 2014, 14% of travelers used some form of a home-sharing site to rent a house, condo or something similar (GlobalWebIndex). And Skift's "2014 State of Travel Report" revealed that 35% of travelers using this model are millennials. In the past year, more than one in five travelers under 35 have rented a home, apartment or condo. With Millennials expected to finance half of all travel spending by 2020, we all need to pay rapt attention because they are simply more accustomed to networking with and trusting peers as illustrated by the following 2013 data:
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