Airbnb changed the game!
Nowadays it is not easy to access the experience of the real culture and authenticity of a country because of many all-inclusive packages which dominate the tourism and hotel industry. Airbnb made a twist whilst opening a platform where tourists are able to connect with more local and authentic experiences in a host destination.
For our study it was interesting to understand how value is co-created by guests and hosts in the context of Airbnb, because that’s what tourists are seeking for – unique, local and memorable experiences.
As a country, which offers various types of tourism and products, the famous sea, sun and sand, Jamaica was the research context of our paper. Not only because tourism in Jamaica is growing continuously and it is a main driver of the country’s economic development, but also because the tourism growth shows the development of the sharing economy: Jamaica currently counts 1,500 Airbnb listings.
However, little research has been done to understand the social impacts, guest experiences and value creation processes the sharing economy brings. The demand for research to understand the transformative effect of platforms, especially Uber, Eatwith and Airbnb, is high. The aim is to investigate social practices which lead to a formation of value and experience in connection with Airbnb and so understand ‘how’ value is co-created between hosts and guests, ‘what’ value results through tourist experiences and ‘what’ resources are needed from the Airbnb perspective.
What is value, can it be determined and how can we measure it?
In the experience economy and so-called service-dominant logic (S-D logic) we hear lots of discussion around experiences and value creation. As tourists and travellers, we all look for unique and memorable experiences. Value is a result of the effort between producers and consumers. Value cannot be pre-packaged.
Value can only be proposed and created with and determined by the consumer through consumption and use.
This means that co-creation of value is not pre-existing. It is a process, a practice that happens between companies and consumers!
In tourism, experience and value co-creation can thus occur in environments where guests and hosts interact. A paradigm for research about experience and value co-creation is the S-D logic, which has found increasing attention in the tourism and hospitality literature.
So what happens when the S-D logic gets interlinked with experience co-creation in the Airbnb context?
Airbnb offers value! The platform not only connects guests with commodities, but also provides resources, like the host’s home and the local environment. When these objects are integrated, a unique value proposition is formed and value co-creation is facilitated.
Airbnb includes the views and activities influencing locals’ daily lives and sharing their way of living.
What follows are sharing economy platforms that change guests from being tourists and travellers to become guests in the case of Airbnb.
Our study: Exploring value co-creation in Airbnbs
To explore value co-creation, an online content analysis was used. Over 1,900 online reviews posted by guests on the Airbnb website of Jamaica were selected and manually extracted. By interlinking S-D logic, value co-creation and social practices theories, the findings demonstrate three main themes. These themes show how value is co-created in local and authentic experiences in the Jamaican Airbnb context. They include value co-creation resources, practices, resources and guest-host value co-creation outcomes:
Theoretical Framework: Value Co-Creation Airbnb (Johnson, A.G. and Neuhofer, B. (2017))
Resources that form the basis of value co-creation efforts in Airbnb settings, are the Airbnb home, places in the local community and the Airbnb host as a noticeable value creating actor. The host as a value creator, is a resource integrator, who creates the basis in which value co-creation can happen, while the Airbnb home reflects the product guests consume and buy through the platform. Beyond the Airbnb typical resources, it appears that guests also demand resources that are similar to usual hotels, like wi-fi, air conditioning, hot water and a pool, as well as a centrally located accommodation.
What are the value co–creation outcomes that result when all resources are integrated and co-creation practices appear in the guests’ local experiences?
Three categories where identified which occur when a positive value was created by guests:
- positive recommendations
- repeat visitation intention and
- perceived authenticity
Value co-creation is dependent on the variety of resources integrated and practices offered with Airbnb. Value is transferred through positive reviews to hosts.
This means, that value does not stop with the individual’s experience of the Airbnb stay. It is carried forward to other potential travellers and tourists involved.
In the ‘experience era’ value is not pre-packaged anymore …
The feeling of being a local at a holiday is what tourists want!
This leads the hotel sector to find opportunities collaborating with other sharing economy platforms. The sharing economy should not be seen as a threat. Hotels could cooperate with platforms, such as Airbnb offering packages that allow visitors to stay either in traditional or Airbnb accommodations or a mixture of both during their stay as they move around the island. Hosts can see what practices create particular value and seek to offer these in order to facilitate and co-create local, authentic value and experiences with guests.
Hosts and locals are seen as core value propositions of a guest’s experience, by creating authentic, unique and unforgettable experiences and memories through interaction. That’s what it’s all about!
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