Since the creation of companies based on collaborative or sharing economies is experiencing exponential growth, the tourism sector has to compensate in order to satisfy this demand. the hotel factory provides a list of suggestions to help this balance which includes prioritizing online reputation and more.

Since the creation of this economical model, more than 10 years ago up until today, companies based on collaborative or sharing economy have experienced an exponential growth that has surprised the hotel sector. Due to the emergence of this new competition, the tourism sector needs to find new ways to renew itself and adapt to new habits and customer behaviour to be able to satisfy this new demand.

Although one of the main solutions to this type of business based on sharing economy would be a regulation of assets, “the scarce coordination between the multiple administration entities and tourism organisations and its exasperating slowness has caused that a unified and ultimate solution still hasn’t been given to confront this new economy” (Juan Molas, President of CEHAT). Some autonomous communities, such as the Balearic Islands, are taking measures against these kind of companies, but they only are “partial” and local solutions, not a strong measure from the government to confront this problem. Until this solution from the central government or other public organisations arrives, the hotel sector will have to depend on its own measures and find concrete and feasible solutions to this competition.

• The hotelier’s main concern should be around innovation and new technologies. To find a balance between new technologies and customer service is a highly valued by consumers, and hence a key factor. Innovation and development of technologies will allow the hotelier sector to capture information of their current and potential client, information which can be used to offer a personalised product and service. For this reason technology and mobile apps will be so important during the next years,  they will allow companies to collect information and make the most of big data; essential for the understanding of consumer behaviour.

• In addition to betting on innovation and new technologies, the hotel sector must also prioritise the online reputation of its hotels. Given that each year more and more clients base the choice of reservation of the hotel on its online reputation. In Spain 27’6% of the overnight stays in 2015 were booked through OTA’s, a percentage that has been continuously increasing every year. This means that consumers book more through these channels, and as a study from the Cornell University stated,  a good online reputation will affect occupancy, ADR and revPAR. One of the tools that is highly used worldwide and most efficient to measure online reputation is the Global Review Index (GRI).

• Another point that the hotel sector needs to improve to confront peer-to-peer (P2P) business is pricing. Hotels need to ”differentiate by means of innovation and business models, to search innovative solutions that will allow a better management of prices” (Marcus Bernhardt, Commercial director and member of the executive board of Europcar). Meaning that price should be transparent and adapted to each segment and market function that it’s focused in.

• Finally, hotels should also define in a very clear way which will be their target segments, since customers will soon demand custom-made hotels in which he can find all products and services needed. For this reason, making an investment in employee training will also become essential, due to having to adapt to this new customer and provide the expected service.

• Among other solutions in which the hotel sector should invest in, we can find partnerships between hotels and other businesses (casinos, shopping centres, etc.) in case of an independent hotel, it’s recommended to be part of a hotelier seal (Relais & Château, Kiwi Collection,The Leadings Hotels of the World, etc.). These associations will highlight the importance and visibility of affiliated hotels, making it easier for these hotels to reach their target consumer, or on the other hand easier for the target customer to feel identified with this brand.

To face companies based on sharing economy or P2P accommodation companies such as Airbnb and Homeaway, hotels must find a balance point between technology and customer service. Meaning that they need to adapt and even anticipate to its clients´ needs using big data and mobile apps, and fulfil the guests´ expectations with a personalised service.