For a while, sceptics may have brushed off the rise of the sharing economy as a trendy neo-hippy movement, embraced only by millennials and those looking to save or make a quick buck, but just half a decade later and how things have changed. The shared economy has grown into a multi-billion dollar industry that has forced us to question the business models that underpin almost every aspect of our lives – particularly travel.
Up until recently, the focus had been on leisure – but that is all set to change as some of the heavy hitters in the sharing economy landscape set their sights on business travel.
According to the Phocuswright Traveller Technology Survey 2014, 13% of business travellers used a car or taxi service hailed through the likes of Uber, with 7% using a ride-sharing service, and 1 in 5 business travellers used a room rental service.
Earlier in the year, Airbnb announced that it had revamped its business travel programme to better enable companies to arrange and track employees’ travel while at the same time declaring its plans to expand throughout Africa. Uber has also launched business profiles to create a more seamless service for corporate travellers.
This raises some really important questions for travel managers to ponder. Are shared economy providers really safe? Would the company be covered if there was an incident of some kind? What impact will using them have on relationships and commitments with preferred suppliers? Would corporates even be open to these alternative options? And is it legal? While these shared economy players raise a number of questions around security, duty of care, payment and regulation, they are here to stay and we expect them to disrupt the Managed Travel marketplace.
There are some perks that should be factored in, including:
Reduced costs: Imagine saving around 40 percent on your accommodation expenses, without having to compromise on comfort? Or about $1 000 per year per employee on ground transport? These are the claims being made by sharing economy providers – in fact, Uber has even created an online calculator to work out how much your business may save by using their services.
More flexibility: Smartphone access means that corporates can book transport and accommodation on-the-go, which can be a big time-saver, especially when plans go awry.
Seamless payments: Shared economy companies tend to be well-integrated with mobile money wallets, which is particularly important in the African context where credit cards aren’t as prevalent as they are in other parts of the world.
As corporates increasingly using shared services in their personal lives, and with the blurring of lines between leisure and business travel, it seems inevitable that this new wave of sharing economy startups will force travel managers to re-evaluate their processes and consider how they can integrate them into their travel policies. Those that are ready and have planned ahead will be those who reap the biggest rewards.