7 -min. read

One potentially exasperating side effect of on-demand car services is strangers randomly entering curbside vehicles. What’s potentially even more exasperating is that these would-be riders are often unperturbed, demanding (according to one New York driver who’s fallen victim more than once), “Are you Uber? Well can you just be: can we go?”

Blame the rising trust in strangers. The sharing economy blurs the lines between economic and social transactions and generates behavioural changes that in turn shape how we define a desirable travel experience, a pleasant taxicab ride, or a fulfilling leisure activity.

With the rise of the sharing economy, it turns out that we appreciate – or, at least, are not vehemently against – random encounters with others. When Uber and Lyft decided not to install a glass pane separating drivers and riders in traditional taxis, they created an invitation to turn an anonymous economic exchange into a social relationship. Uber Pool and Lyft Line took this socio-economic infrastructure a step further, allowing us to trade our anonymity for a personal connection. These connections are regularly fleeting, but occasionally they turn into a romantic relationship; a professional collaboration; or even a friendship.

Communal ping-ping tables at ARRIVE Palm Springs – photo by Foxes and Wolves
Communal ping-ping tables at ARRIVE Palm Springs – photo by Foxes and Wolves

Social engagement has a positive impact on human experience. We’re in for a potential surprise and delight every time we enter a new Airbnb apartment to discover that our hosts have left us a welcome note, a bottle of wine, or breakfast. Simple, human gestures that we experience in the physical world make us feel special. They make us feel closer to other human beings. In the direct antithesis to the feelings of removal created by the internet, we bask in the empathy of our hosts, drivers or concierges.

Our desire to be more connected to the world around us transforms our expectations of travel and hospitality experiences. We want them to bring us closer to the people and activities from local communities we visit. This added cultural and emotional texture makes our travel better – but it also makes us, and the local communities, better off.

Kitchen table-style seating invites conversation at MADE Hotel – courtesy of MADE Hotels
Kitchen table-style seating invites conversation at MADE Hotel – courtesy of MADE Hotels

One hospitality success story is Casa Bonay in Barcelona, which has embedded itself in the existing socio-economic and cultural life of its locale – rather than disrupting its neighborhood, the Casa has become a community hub, providing everything from jobs to a meeting place where residents and travellers interact. Similarly, ARRIVE creates a self-contained neighbourhood that invites locals to participate; MADE and The Curtain encourage guests to mingle with like-minded people from near and far in new formats; while Locke Living – “a design-led aparthotel for those who want to challenge the status quo” – immerses guests in a destination by creating hybrid spaces where they can meet, play, work and thrive with local people and travellers alike.

Casa Bonay – photo by Nacho Alegre
Casa Bonay – photo by Nacho Alegre

All these brands are intricately woven into the fabric of their setting, aiming to create offline communities not unlike those created in the online world. “When I left Facebook, I got really interested in the idea of building physical social spaces where people can interact and have shared experiences, along the same lines of what happens online”, explains ARRIVE founder, Ezra Callahan.

Ezra Callahan – courtesy of ARRIVE
Ezra Callahan – courtesy of ARRIVE

Shared experiences bond us more with other people than shared consumption, claims a Fast Company article entitled ‘The science of why you should spend your money on experiences, not things’. Joseph Pine, author of The Experience Economy, agrees: “When we buy experiences, those purchases make us happier than when we buy things.” He cites the 2014 Boston Consulting Group report that revealed that of the $1.8 trillion spent on “luxuries” in 2013, nearly $1 trillion, or 55 per cent, was spent on luxury experiences. Unique experiences make us unique – far more than owning material goods does.

Experiences not only bring us more happiness than possessions, research claims; they also make others more interested in what we have to say. Simply put, our friends would rather hear about the ice marathon we ran in Alaska than an update on our latest pair of Louboutins. The things we do shape who we are, the lifestyle we lead and the choices we make. They are our personal Weltenschauug, or world view.

For the generations who grew up before Facebook and Snapchat, fashion was a kind of social elixir. “In the past, teenagers used fashion brands as a kind of social signal”, writes Helena Pike for Business of Fashion. But today’s next generation of affluent travellers live on social media, where currency is built on experiences. Macie Merriman, executive director of growth strategy and retail innovation at Ernst & Young, notes, “[Young affluents] don’t want to buy stuff. They’re buying an experience and the product they get is kind of a bonus.”

Airbnb app
Airbnb app

Janine Yorio – founder and CEO of on-demand hospitality startup Stay Awhile, which combines a membership model with the homey feel of Airbnb and the reliability and convenience of hotels – noticed that what was missing from the hospitality landscape was “a solution that addresses the way that people are starting to live, which is a combination of very minimalist and also hyper-mobile. People aren’t interested in amassing china collections the way they once were when they got married, or in having this very precious lifestyle. Instead, they want to pare it down and they want to be in lots of different places. Airbnb has really spoken to that demographic because it has allowed people to stay longer by giving them lower-cost alternatives to hotels. They can have this more immersive travel experience where, instead of going on a bus tour in ten European cities, they can go and live in Rome for a week. It’s an entirely different way of living and travelling.”

The modern desire for a dynamic, flexible way of living applies also to work, as epitomised by Roam, a global network of co-living and -working spaces, or wecoco and Remote Year, two remote-working collectives that tour the planet, setting up base in a destination for a temporary period. These brands are responding to the next generation of travellers for whom the notion of ‘home’ is becoming more fluid, just as the lines between their work and personal lives are blurring. The shared experiences they offer are unique each time, according to the cultures in which they immerse themselves and the connections they facilitate between different members – it’s this sort of uninhibited, connected experience that young affluents seek.

'Home' becomes a fluid concept at MADE – courtesy of MADE Hotels
‘Home’ becomes a fluid concept at MADE – courtesy of MADE Hotels

By understanding why different ultra-high-net-worth audience segments are attracted to the sharing economy, luxury hotels can unlock the opportunity to cater to them all. “The future of travel and hospitality is having this network of spaces that really function as people’s second homes around the world. It makes a lifestyle that was once accessible to the elite much more accessible to the mainstream”, explains Yorio. “New Yorkers have been living between Miami, the Hamptons and New York City – those who have money have been doing it for hundreds of years; but through sharing economy models we can make this much more accessible to a much broader segment of a population. People want to be able to move around and not be pinned down to their apartment in Bushwick, but rather have access to these different spaces.”

The main promise of the sharing economy for travel and hospitality isn’t frugality: it’s pushing the boundaries of consumers’ expectations of what good service and experience are. The seamlessness, convenience, flexibility and social serendipity that Uber or onefinestay provide is something that new affluents have now also come to expect from legacy travel and hospitality brands. Thus, business models and revenue streams that are emerging to meet these various needs revolve around offering products on-demand as a service (versus just selling them); partnerships and tie-ups; motivating a marketplace; and new service value-adds.

Exceeding customers' expectations at Casa Bonay in Barcelona – courtesy of Casa Bonay
Exceeding customers’ expectations at Casa Bonay in Barcelona – courtesy of Casa Bonay

The good news is that technology upstarts (such as Uber, Airbnb and even Facebook) give existing hospitality brands a roadmap for how to use the sharing economy to rethink their own businesses and adapt to become stronger than ever. Of course, hospitality’s strategy of taking direction from successful practices outside its own industry isn’t new. Since the dawn of contemporary travel, hotels have looked to nightclubs for inspiration – think Morgans and their Studio 54 lobby references. In contrast, today’s lobbies are all about vibrant, multi-purpose, easily adaptable spaces made for sharing ideas, not WiFi connections – something that future-facing hospitality brands have borrowed from the sharing economy.

These travel rebels are providing the manual for the next generation of high-end hospitality brands to learn from and apply to their own business models. Forget Six Sigmas, Five Ps and other disciplined, inflexible approaches to strategy. In a volatile environment, it’s more important to have the agility necessary for incremental growth, a laser traveller-focus and the ability to view business from a problem-solving perspective. As digital-first companies grow and move up the value chain, their definitions of quality and value become the norm. With no barriers of entry left, big brands have an exciting journey ahead in adopting them.


Ana Andjelic
An experienced strategist with a passion for new things, Ana has earned her doctorate degree in sociology and worked at the world's top advertising agencies. She's also a frequently published author, public speaker and writer. She lives in New York City.

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