1. Introduction:The sharing economy, also called collaborative economy, is explosively growing in the whole world and getting popular among consumers. Some people think this new business will subvert the market because it has a great effect on many levels of marketing behaviour.
Moreover, this new business model is described as new “Industrial Revolution” as it changes the business operation of society(Botsman, R., & Rogers, R., 2010). Besides, the appearance of sharing economy makes a huge impact on consumer behaviour, which becomes more complex and uncertain(Liang, Choi and Joppe, 2018). People are now widely willing to exchange resources such as house, cars, car pot or even tool box, with someone they do not know to make money. Airbnb is now a well-known house rental company with high technology and most users and house providers on the basis of sharing economy. However, why are people willing to stay in the house of someone they do not know before ? What kind of people would like to participate in Airbnb ? What trigger makes them want to get involved in this new business model ? Above questions are the main idea this study will aim at and discuss.
2. Target segmentation: U.S.According to the report of BBVA in 2015 (Quinnones, A. & Austine, A., 2015), more than half of American people are acquainted with sharing economic.
It shows that sharing economy is a common phenomenon in the U.S. currently and accepted by public. Furthermore, people’s age between 16 to 34 took up 46% of users in the sharing economy, which means the segmentation of young adults is most willing to try novelty.
The second highest portion is people at the middle age who occupied 35%. At last, people over 55 years old is only of 19% of the total amount. On the other hand, two of the highest profile company such as Uber and Airbnb are derived from U.S. and the related companies are still growing rapidly. Moreover, the business model and system are quite mature than other countries. In view of this, U.
S. market is the most appropriate in this study.Source: (Quinnones, A.
& Austine, A., 2015)3. Three main concept: Case study of Airbnb in U.S. 3.1.
1. Rationale 1: Motivation Motivation is a physical force and a trigger which makes individuals determined to make their unfulfilled needs transformed into real action generated by the state of eager. People relieve themselves from the tension through the action that they anticipate their needs will be satisfied. Furthermore, people’s learning and considering are the beginning of the goal that they choose and the type of action people want to bear with. The series of action that people form the desire and do to attain the goal is composed of cognition and what they learned in the past. Hence, motivation is a motion of induction of people’s purchase and purchase experience (Schiffman, Kanuk and Hansen, 2012).
According to this, figuring out the factors of people’s interest aroused all the way to make decision in sharing economy is an important research.3.1.2.
Consumer motivation When it comes to thrived sharing economic nowadays, Airbnb is the company that 90% of people will mention. It is curious how come people want to participate in this kind of disruptive innovation and what makes them attempt the so different service. Therefore, there are seven factors in the individual motivations to be considered in this case, which are price, location convenience, home benefits, local authenticity, and novelty. Trough factors mentioned above, it can be realized that what people’s induction to make use of Airbnb service and product(Guttentag, 2016). The first factor is price, lower spending is a intense attractiveness to people in disruption innovation. Moreover, low cost is usually regarded as an important attribute to clarify the actual demand in sharing economy(Adner, 2002). Generally, for consumers’ desire of saving money, it is believed that low price is the first driver and basis that Airbnb offer.
Additionally, average hotel rate is higher than Airbnb even in some biggest competitive destination market. Moreover, consumer can acquire more transparent information of accommodation through internet and Airbnb often offer an apartment including more than two rooms. Last but least, sometimes if the rental is more than a week, providers even give discount.
Due to these reasons, Airbnb is seen as a more economic choice compared to hotel and fulfill consumer needs.The second factor is location convenience, which is often regarded as a drawback of Airbnb. However, some research show that travellers choose accommodation out of the popular attractions rather than core area in the city(Nowak et al., 2015).
On the other hand, due to the abundant number of providers all around the world, people have more choices to meet their needs.The third is home benefit, the unique, distinction and feel like home is considered a biggest characteristic between Airbnb and hotels. This feature does not only avoid fighting against hotel directly but create a distinct value for consumers(Guttentag, 2016).Fourthly is local authenticity, it’s similar to gain “local experience” and know “local neighborhood” for consumer and support the advantage of Airbnb “accommodation location”. Consumer may not contact the locals directly buy the atmosphere make them feel living as locals, this is the customer value that Airbnb offer and make difference from hotels(Guttentag, 2016).The last but least, novelty, is normally what travellers seek when travelling, to find something “fresh” and exciting. Many tourism articles mention that the choice of seeking novelty is more important than accommodation choice.
However, according to Guttentag(Guttentag, 2016), this motivation is scored less than local authenticity, which means the desire for knowing local people does not equal to seek exciting stuff.These five characteristics are main motivations that why so many people follow the trend of Airbnb, whatever consumer needs, value, goals or involvement are fulfilled by Airbnb. 3.2.1.
Rationale 2: Perception, learning and memoryIn the reality world, the way people view this world is not really objective but built on third perception such as needs, wants, previous experience. For the marketers, the context of reality world is not the point should be focused on, the most important target is how consumers perceive their environment. In others words, it’s not what a person think of this world but a what a group of consumers think so, which makes an impact on their action, behaviour, preference and so on.
What individuals choose, form and interpret the stimuli shape the consistent world of perception of consumers(Schiffman and Kanuk, 2005). However, in this study, sharing economy is a relatively novel conception to public. Therefore, it is a curiosity how people perceive this new service and make decision based on the previous experience and learning. 3.
2.2. Perceived trust, authenticity, and securityConsumer usually ‘value’ the world not by objective environment but their view of evaluation, it is so-called ‘perception’. In the concept of marketing, perception is when consumer in the decision making process, the value of all factor and alternatives are considered (Sandip, 2016). If the value of perception is higher, there is higher possibility for consumer to buy it. According to Dodds and Monroe, consumer consumer usually focus more on the value of perception than the relative cost of product(Dodds and Monroe, 1985). In the case of Airbnb U.S.
, there will be three perceived value such as trust, authenticity, and security to be discussed in the following part.The first is perceived trust, in this case, there are two channels for consumers, one is consumer to Airbnb; while the other is consumer to house provider. Because it’s a peer-to-peer service, it’s very important for brand to build trust with consumers before they use the service. Therefore, some provider offer the fancy service or instrument in the property to make them trustworthy. Nonetheless, the rating system is an essential mechanism, which makes consumer can acquire trusted information about property and providers from other tenants in the past. Otherwise, a favorable feedback system not just build the trust with provides but also the platform. Through reviews from third-party, it makes consumers perceive trust and increase opportunity to choose the appropriate house renter(Giulia et al.
, 2017).The second is perceived authenticity, there are two main types of theories of authenticity in tourism industry, one is the objective-related authenticity(e.s. surroundings, property, decoration); the other is activity-related authenticity(e.s. culture, existential)(Wang, N., 1999). According to Grayson and Martinec(Grayson, K.
, & Martinec, R., 200), authenticity may change consumer’s perception and evaluation of place, service, and degree of comfort. Moreover, some research consider searching a authenticity life is mainly the driver of consumer making use of Airbnb to find accommodation(Yannopoulou et al., 2013). On the other hand, the conception of perceived authenticity is also used to be the brand identity and slogan, such as Airbnb “Live like a local”(Yannopoulou et al., 2013). Moreover, in U.S.
, the desire of consumer hoping to make connection with locals and seek local experience affects the consumer behaviour(Tussyadiah, P., & Pesonen, J., 2015).The last but least, due to the fast growth of internet, consumers do not need to face salesman or machine directly, more purchase move to online. Due to this reason, the problem of perceived risk has moved to security of information provided by online platform(Sujin, Y. & Sungsook, A., 2016). Some research show that the issue of perceived security has become a criteria to measure success or failure of consumer satisfaction(Yoo, B.
, & Donthu, N., 2001). The private information such as name, photo and basic profile, has been transferred based on the mechanic of online platform to use, provider. However, the perceived security of travellers has been regarded that affected by government policy and Airbnb privacy regulation(Wirtz, J., Lwin, O. &, Williams, J.
D., 2006) 3.3.1 Rationale 3: IdentityThere are many meanings in identity, in consumer’s view, it’s how a person respond coherently to the stimuli to surroundings. Normally, there are three types of saying in description of personality such as psychoanalytic, socio-psychological and trait-factor.Psychoanalytic divides personality into three parts, which are id,ego, and superego. The second is socio-psychology, which talks about the correlation of people and society. The last is trait-factor theory, which elaborates the personality is formed by assembly of personal characteristics(Blackwell, Miniard and Engel, 2001).
Regarding to the sharing economy, what type of consumers are a fan of this new trend and how the brand personality form will be discussed in the next part. 3.3.2.
Five main types of consumerAlthough sharing economy is not a new idea in the study of conception of consumer; however, due to the appearance of internet, sharing economy platform is now growing fast and getting popular by consumers nowaday(Belk, 2014). In terms of this change, the pattern of consumer has not only transformed dramatically but make a significant difference on demand and request(Magno, De Boer and Bentoglio, 2016). At the same time, this business model also encourage people to get involved in networks to distribute and make transaction rather than the traditional market(Festila and Müller, 2017). On the basis of that, matching the provider and consumer is important for Airbnb due to the different personality.According to Guttentag’s research(Guttentag, 2016), users can be generally categorized to five types, which are Money savers, Home seekers, Collaborative consumers, Pragmatic novelty seekers and Interactive novelty seekers. On the other hand, the most of people in U.
S., who join the sharing economy is millennials;besides, number of baby boomers is growing(Samuel, 2015). On the other hand, gender is a essential issue when considering the analysis of consumer demographic(Lee and Kim, 2017). However, due to these reasons, five types of users will be main topics in the following part. The first is Money saver, who is usually induced by Airbnb due to the less spending on property rental. The research shows some traits of money saver, most of them are young, age below 30 occupies 63%; however, the average is 53%. On the other hand, only 3% of people carry children when travelling. Nonetheless, money savers are mainly driven by low cost, not affected by the influence of Airbnb.
They choose whatever the accommodation which possess the acceptable with relatively quality(Adner, 2002). For Airbnb, this group of people should be focused on and spend time on building up the consumer loyalty.Next is Home seekers, who are searching the property with comfortable space, good amenity and home-feeling atmosphere. Moreover, the average of age is older, only 42% is under 30 compared to the average is 53%, 24% aged 41 and over compared to average is 17%). On the other hand, relating to education background, 35% of home-seekers own graduate and professional degree, and there is least possibility to be backpackers(10% compared to average is 18%).
Normally, home seekers choose entire house or apartment offered from Airbnb, the motivation here is they are mainly attracted by home benefit, not low cost. Logically, people who seek large and gorgeous-decoration house usually carry family or travel as group. For Airbnb, this type of consumer is precious as they have frequency to use Airbnb app, longest length of stay. The third is Collaborative consumers, who are moved by economy ethos and grab the chance to make connection with the locals and gain local experience. Besides, the age of this group is higher than average(47% of whom are under 30, 36 % age 31 to 40 compared to 30% average). Moreover, this group of people are usually travelling to other countries(67% compared to average 60%) and more willing to be a backpacker(25% compared to 18% average).
Furthermore, they use Airbnb more than other group(5.4 compared to average 4.6) and also show the high satisfaction and stable consumer loyalty. Collaborative consumer are regarded as supporter of sharing economy(Botsman & Rogers, 2010), and they are the type of people that Airbnb exactly describe in their advertisement. The fourth is Pragmatic novelty seekers, who are relatively different from other types of consumer with their high degree of ‘Novelty’ motivation. Even from the research show that they have same degree of ‘home benefit’ but Pragmatic novelty seekers do not fancy connecting with locals or having a authenticity experience, but they also pursue the lower cost and the convenience of accommodation.
It is profiled that Pragmatic novelty seekers are younger than average(59% of people are under 30 compared to 53 average and 9% aged 41 and over compared to average 17%). Even Pragmatic novelty seekers has same motivation as Home seekers, however, they have different composition. Generally, they are younger and having less experience using Airbnb.
Furthermore, Pragmatic novelty seekers and Interactive novelty seekers have the “Novelty” motivation in common, this motivation is an essential factor in consistence with personal innovation to know well the adoption of people (Rogers, 2003). For Airbnb, they have to focus on attracting this type of consumers by emphasizing the speciality and distinctness. The last one is Interactive novelty seekers, who has somewhat similar to Pragmatic novelty seekers but the biggest difference is that Interactive novelty seekers are interested in experiencing the local life and contact non-touristy neighborhood surroundings. Moreover, similar to Collaborative consumers, most of them travel as a backpacker( 27% to average 18%) and have a tendency to stay in the short term property ( 47% compared to average 29 %) and shortest stay length(3.
4 days compared to average 4.2) . On the other hand, Interactive novelty seekers are usually taking a trip with slightly less members( 1.5 accompany compared to average 1.8). From the view of novelty and interaction, it can be categorized that Pragmatic novelty seekers to Home seekers and Interactive novelty seekers to Collaborative consumers.
This group of consumers is the target that Airbnb aims at now and can be attracted by making interaction with property owners.Above segmentations are five biggest group of peosonality of Airbnb existing in sharing accommodation rental market. Different segmentation expresses a variety of consumer behaviour which affects their decision in choosing the appropriate company for them. Also, suitable foster of brand identity is an important object to match the personality of target segmentation.