It’s a Puzzlement! How the Sharing Economy Will Impact the Meetings IndustryFebruary 1, 2016

February 1, 2016

It’s a Puzzlement! How the Sharing Economy Will Impact the Meetings Industry

CIT-2016-02Feb-Sharing_Economy-860x418As the world changes with breakneck speed, so, too, does the meetings world. Many of us are finding it difficult to keep pace with the incredible number and variety of changes that bombard us on a daily basis — not to mention the ever-present information overload accompanied by the dizzying feeling that we can never catch up.

And so it is with the sharing, or peer-to-peer economy, which has rapidly evolved in part due to all the new devices and downloadable free apps that have inundated the market. Billion-dollar lodging and ride-sharing companies, such as Airbnb and Uber, did not even exist a decade ago, and are now emerging as genuine competitors to long-established traditional providers.

“The sharing economy certainly isn’t going anywhere. In many ways, it’s what we as meeting planners have been doing for a very long time.”
— Debbie Friedman-Hueller 

Perhaps not surprising for a trend of this magnitude, opinions vary on the long-term impact on the transportation and hospitality sectors — and the meetings industry that depends on them. Some see an inexorable move toward increased collaborative consumption or sharing of resources in new ways. Others are less convinced.

At the same time, traditional providers are feeling great pressure to compete effectively against a wave of emerging collaborative alternatives for services — especially in the lodging and transportation arenas.

One fact that can’t be denied is the growth of the companies leading the charge in the sharing economy.

A report for 2015 just released by travel and expense management software provider Certify reveals that Uber accounted for 41 percent of total ground transportation transactions compared with 20 percent for taxi service and 39 percent for car rentals. Prior to the fourth quarter of 2015, only San Francisco and Boston reported Uber as having a greater percent of rides than car rental.

Also in the ride-hailing space, Lyft experienced an increase of 712 percent in 2015 from the previous year, although the second-largest provider represents just a small part of total rides overall.

Is Sharing Really New?

“The sharing economy certainly isn’t going anywhere,” says Debbie Friedman-Hueller, senior meeting and event planner at dairy cooperative Land O’ Lakes Inc. in St. Paul, Minnesota. “In many ways, it’s what we as meeting planners have been doing for a very long time.” She explains that this includes providing shared rides based on convenience, matching individuals as roommates based on shared interests and repurposing space. “This formula of looking at the ebb and flow of traffic to create a pattern to maximize use — think breakout space — is now being picked up mainstream for housing, ride service, even renting pets,” she says.

It’s important for meeting planners to understand how meeting attendees view options provided through the sharing economy, according to Friedman-Hueller. In considering how attendees view the value of, for example, hotel room blocks at destinations, planners should realize they may prefer staying in a nearby home with the luxury of at-home amenities such as a kitchen, full bathrooms and living spaces. Similarly, these kinds of choices may appeal to travelers’ personal preferences for how money is spent.

“People tend to like to give their money to people, rather than to large corporations,” Friedman-Hueller says. As an example, she cites an alternative to paying $1,000 to a large hotel chain for a week-long stay. “People feel better about giving a thousand dollars to a young couple to stay in their house for a week, and if that means knowing that this couple is going to Europe on that money, they feel like they are now part of contributing to that dream.”

Planners also may find themselves becoming advocates of the shared transportation services. In her own case, Friedman-Hueller encourages attendees to download the Uber app prior to arriving onsite and lets them know the radius in which the company operates.

“It’ll be interesting to see how long it is before we stop providing airport shuttles and instead offer an Uber credit for the amount of an airport run,” she says. “This will allow the attendees to take more control of their own travel plans, and also take the huge burden off the shoulders of planners in trying to organize travel manifests and shuttle runs.”

Friedman-Hueller recalls a meeting in Miami last May when local cab drivers went on strike.

“This could have put a huge damper on the overall attendee experience because they would have been relegated to the hotel and to the scheduled bus times that we had in place for offsites and to the airport,” she says. But instead of getting anxious, she says attendees simply asked if Uber was still up and running. “Indeed, Uber was still in play and attendees couldn’t have cared less that all cabs were out of use.”

Demographics Count

Meeting planners also should keep in mind that the demographics for the meetings industry marketplace are changing, says Rebecca Sanicki, sourcing solutions manager for Balboa Meeting & Event Solutions in San Diego. She notes that the new target audience for meeting planners is quickly becoming the fast-growing millennial generation, a generation that seeks engagement and is all about sharing experiences.

“Understanding what’s important to millennials during the meeting experience and being able to put these new ideas and expectations into play is essential for the success and future of the meetings industry,” she says.  “One way to do so is by embracing the shared economy and figuring out how to leverage it to our advantage, while keeping the meetings industry current.”

Sanicki points to Uber and Airbnb as leaders in this movement.

“Transportation and housing are big logistical pieces of most meetings,” she says. “Getting creative to promote shared experiences with Uber and Airbnb can encourage attendee engagement, and it will help meetings to stand out from other, more traditional meetings.”

She adds that experiential-based companies such as Airbnb want to partner with meeting planners, and there can be some definite advantages to doing so. “Increasing room block size, which increases overall attendance and promotes a meeting community for your event, is just one plus,” Sanicki says. “Essentially, this means opening the door for expanding your reach and your audience — and theirs.”

Planners also should be aware of potential weaknesses, notes Carolyn Davis, owner of Strategic Meeting Partners in San Diego.

“On a personal level, I am a big advocate of the shared economy and use those services whenever possible,” she says. “It’s a great concept in the fact they allow underused resources to be put to their best use.”

At the same time, she acknowledges the challenges that may be faced in planning meetings.

“On a professional level, I do have some reservations,” she says. “With the shared economy model, in many cases you will never truly know the quality of service until it’s too late.”

Davis recalls an incident where a colleague who regularly flies into town via private aircraft decided to try Uber for the first time.

“Instead of a late model Cadillac Escalade pulling up to his plane as the engines were spooling down with a driver ready to pull bags, he and his passengers had to drag their bags to the curb and wait for the Uber driver to arrive,” she says. “Once Uber did arrive, he noticed the vehicle was not clean and the driver not professionally dressed.” She adds that on the positive side, the vehicle was black and the driver was personable, but the overall result was somewhat lacking.

“The shared economy model is an excellent concept,” she says. “But at this point, I’m not willing to risk my professional reputation.”

Targeting Business Clients

In growing their companies, sharing economy providers are reaching out more aggressively to businesses rather than just individuals.

Airbnb, which labels itself as the world’s leading community-driven hospitality company, has made it clear that the public at large is not its only target audience. Since its 2008 founding, the San Francisco-based company has grown to provide accommodations in more than 34,000 cities in more than 190 countries.

Recently the company upgraded its services to appeal more to business travelers. Improvements include a new product suite that not only reduces the complexities hosts face in accommodating guests, but also helps in attracting those traveling on business while expanding the Airbnb for Business program. Hosts now can add a badge noting that their listings meet specific expectations of those traveling on business.

Listings that are identified as “business travel ready” will feature business-friendly amenities such as Wi-Fi, a designated workspace, iron and hair dryer. Travelers also can take advantage of 24-hour check-in and a policy of no-host cancellations within seven days.

Originally not considered much competition for traditional hotels, Air­bnb seems to making significant inroads as it attracts more business travelers. According to the Professional Convention Management Association, the trend is especially significant in larger cities. Not only does this represent unwelcome competition from the hotel viewpoint, but it may also offer challenges to meeting planners. In tasks ranging from negotiating contracts with hotels (with smaller numbers of meeting attendees staying at a given hotel, for example) to advising participants about transportation to the meeting site, planners will need to take this option into account.

According to the Certify report, the popularity of Airbnb is increasing. Data from Airbnb found that compared with hotels, on average corporate travelers stay twice as long in Airbnb accommodations, and they have rated their satisfaction with Airbnb an average of 4.3 stars compared with 3.79 stars for hotels.

And in November, American Express announced a first-of-its-kind integration with Airbnb and created an on-platform loyalty program. Key elements of the program include:

Signup: American Express card members will be able to create an Air­bnb account by using their existing user ID and password. This will allow them to quickly sign up and put a card on file, so booking is fast and easy in the future.

Verification: Similar to the way Air­bnb community members can verify via LinkedIn or Facebook, card members who set up an Airbnb account with their Amex login or choose to “Verify with Amex,” will have an “American Express Card Member” badge on their Airbnb profiles. This gives hosts and guests more information about each other and further builds trust within the community.

Membership Rewards Points: Card members now can use membership rewards points for all or part of their booking — directly on the Airbnb site.

Amex Express Checkout: Card members now can fly through checkout on Airbnb by using Amex Express Checkout, a technology that Amex launched in July, which enables card members to use their Amex login to check out faster by autofilling their card and billing details in just a few clicks.

Less well-known but also reaching out to the corporate world is HomeAway, which offers more than a million vacation rentals in 190 countries around the world. In addition to the primary purpose of vacation housing, the company offers properties for business applications such as workshops, company retreats and teambuilding activities. Offerings include thousands of homes featuring 10 or more bedrooms, as well as access through a mobile app to concierge-type services ranging from Uber cars to childcare and grocery delivery. Some upscale rentals also include access to caterers, private chefs, assistants and event planners.

Similar movement can be seen with transportation providers such as Lyft. According to company reports, Lyft is the country’s fastest growing rideshare platform, completing 7 million rides per month in more than 190 cities and exceeded 40 percent market share in Austin and San Francisco.

Recently, Lyft has been garnering attention with the addition of major investors. In early January, the company announced a $500 million investment from General Motors. GM will have a seat on Lyft’s board, and the two companies will collaborate in creating an autonomous on-demand network and in offering a series of national rental hubs where Lyft drivers can rent short-term vehicles. That new wrinkle will mean even those who do not own a car could potentially join the ranks of the company’s drivers.

Lyft markets “Lyft for Work” as a set of options that includes not just daily commutes and supplements to public transportation, but also as an option for business travel whether transportation is needed for a meeting across the city or out of town.

Of course there is no bigger name in the sharing economy than Uber, which now operates in more than 300 cities in 56 countries.

The company advertises its services as up to 40 percent cheaper than a taxi, potentially saving as much as $1,000 per employee yearly.

For businesses, Uber ensures that only trips that follow a company’s policy can be charged to its account. It also allows corporate clients to add or remove employees readily from their account and review trip information for each ride. With trips billed to one payment method, all expenses are maintained in one place. Details for each business ride include the expense code, cost, vehicle type and route.

Emerging Providers

Uber, Lyft and Airbnb may be grabbing most of the headlines, however, as trust builds within the sharing community other companies are finding a niche within this emerging economic model.

In Indianapolis, the Blue Indy electric car-share service offers business travelers a cost-effective alternative to taxis or car rentals. Launched in September, the station eventually will include 500 cars and 1,200 charging stations at the airport, convention center, hotels and other locations around the city.

In Miami, miRide is a new luxury black car app/service promoted as an affordable alternative to traditional options. It has acquired more than 3,000 users since its August 2015 launch, averaging nearly 400 rides a day. For business professionals and corporate clients, it offers fixed-price rides that can be obtained promptly or scheduled for future pick-up.

Offering booking via a smartphone app, the service provides chauffeur-driven luxury sedans, SUVs and sprinter vans. At the same time, it operates as a state-certified and fully licensed and insured fleet.

Meeting planners should stay on top of the latest news about peer-to-peer apps such as TaskRabbit, a mobile marketplace that finds people to hire for various and sundry jobs and tasks, such as office work and messenger services.

Also, there’s DogVacay for attendees who need a place to house their dog while at a conference. They offer a comfortable host home and claim the service is less expensive than a kennel.

As attendees can’t travel to meetings with their bicycles, Spinlister provides a way to “rent a bike from someone like you.”

Did a meeting-goer forget his business suit? Try Poshmark’s mobile app, which is for people to buy or sell their clothing.

Final Thoughts

Looking to the future, perhaps the most significant factor for meeting planners is simply adjusting to the changes in expectations of those who will be attending meetings.

“Dive deeper to get a good understanding of what your target audience is seeking and expecting from their meeting experience and then embrace their mindset,” Sanicki says.

This should include connecting with them via the technology they use in their daily lives such as mobile apps and social media, and using this knowledge to create meeting experiences where attendees are truly engaged.

“Don’t fear all this,” she concludes. “Embrace the shared economy and get creative with the ways you can leverage it.” C&IT

Back To Top