Category: Collaborative business models

Case studies and visions on how to shape collaborative models and partnerships, envisioning its benefits

Collaborative business modelsTourism trends

Sharing economy and tourism: seeing the elefant in the room

With the aim of monitoring the growth and influence of sharing economy in the wider field of travel services, many institutions such as the Institute for Tourism Planning and Development from Portugal in their ‘Tourism Trends Review‘ have highlighted the impact and evolution of this phenomena:
As a new style of peer-to-peer (P2P) commerce, sharing economy does not merely involve an unusually large number of options for transport, accommodation, and recreation activities. It has also provoked a shift in role of service user and provider. In this environment, contemporary consumers can openly express their individual interpretations of tourism product uniqueness and authenticity as well as indulge themselves in an imaginative manner while moving around well-known and emerging destinations.

This issue was also discussed in 2015 during the 1st Semi-Annual Meeting of the European Travel Agents’ and Tour Operators’ Association with ECTAA and HOTREC representatives and Ms. Elżbieta Bieńkowska, European Commissioner for Internal Market, Industry, Entrepreneurship and SMEs of the European Commission.

In the European Cities Marketing Annual meeting of CEOs of Capital and Major Cities 2015, was an occasion to examine latest destination trends at an influential policy level and focus on the respective impact of sharing economy stakeholders. In two sessions, brainstorming between ECM members and a vivid debate with Airbnb also shed light on what it takes for destination authorities and P2P platforms to work together and deal with issues of common interest over the provision and consumption of travel services. Particular emphasis was also given in exchanging views with representatives from Barcelona and Amsterdam, two cities which have already developed approaches to sharing economy and monitor their results.
It is a fact, however, that both these influential events were only the tip of the iceberg during a busy 2015 including relevant speaker engagements in countries such as Israel, Montenegro, Belgium, Estonia, Croatia, Greece, Portugal, Latvia, and the UK. In all these cases there were moments of great empirical value, especially when we were given the opportunity:

– To realize how market dynamics together with latest statements of UNWTO/EC officials put sharing economy on the spot in this year’s World Travel Market, while only on the sidelines last year.

– To take a look at the actual results of Tel Aviv’s recent partnership with Airbnb to promote the city in joint manner and exchange views with representatives from Barcelona and Amsterdam, two cities which have already developed approaches to sharing economy and monitor their results.

– To learn under what conditions sharing-economy friendly legislation has been in place for decades in Croatia and how hotels team up with BnB apartments and offer them concierge services.

To concentrate for the purpose of this blog post on HOTREC project, the key objectives of the policy paper were to understand the various issues that arise due to the fast growth Short-Term Private Accommodation Rentals (STR) and contribute to the development of a suitable regulatory environment to level the playing field.

When traveling for business or leisure, booking a private house or apartment to stay in via a P2P platform is seen as a trendy and affordable choice: booking, arriving, collecting the key and making oneself, quite literally ‘at home’. More importantly, a simple fact is already common knowledge.

Although the Global Economic Crisis reinforced an interest towards the more effective use of existing resources and the development of new sources of income, advances in technology such as social media and mobile devices accounted for the strongest driver of the sharing and trading of private assets particularly in the case of travel and tourism services.

To examine how the STR have evolved in recent years and transformed the ‘playing field’ for all those involved in offering visitor accommodation, HOTREC policy paper takes into account the following perspectives and international trends.

Business growth: From 2010 to 2015 venture capital firms have invested billions in the “sharing” economy start-ups, with the sectors of transportation and accommodation receiving the biggest shares of funds. Major companies such as Facebook and Amazon are also included lately among potential entrants to the “sharing” economy through the development of peer-to-peer services and partnership-building with existing start-ups.

Consumption patterns: Younger generations (Millennials are commonly identified as those born between 1980 and 1999, and who entered their teenage years as from the year 2000, putting them currently in the 18-35 age group) appreciate a lot customization in customer service at a global level as enabled by technological advancements. P2P Platforms have been effective in using global tools to enhance interaction between service providers and users at local level as well as in providing affordable options for value-seeking Millennials.

–  Entrepreneurial mobility: P2P platforms are  also providing a range of products and services for a new type of footloose global entrepreneur, often freelancing or part of a SME (of which there are now many more, in the wake of technological developments and the global economic crisis). “The way we think about long-term residents versus an emergent and more globalized and mobile population” is actually changing due to the growing appeal of P2P services in transportation, accommodation, and all sectors defining the business travel experience.

–  Forms of employment: P2P platforms provide alternative sources of income to individual service providers, who opt to work as micro-entrepreneurs of the freelance economy. A gradual transition from contractor to employee relationships is however less likely to happen in the accommodation sector, where properties are managed by their owners or tenants. The issue lies in that the sum of individual and commercial activity undercuts hotels on price. When there is also a negative effect on hotel revenues and jobs, it might be another case where technological progress has not yet proved to be a driver for jobs creation.

–  High-level policy making: The activity of the “sharing” economy start-ups has also drawn the attention of national governments and supra-national agencies. Elements of innovation are not rejected in principle, yet political parties in countries such the UK and Canada already participate in a vivid exchange of both positive and negative views on the “sharing” economy.

As these perspectives frame the discussion of various issues including terminology and scales of activity together with suggestions for legislative work, you can a have a look at the HOTREC Policy Paper if you’d like up-to-date knowledge on the agenda of Short-Term Private Accommodation Rentals or even share your thoughts with us.

This blogpost is from  http://www.toposophy.com/insights/insight/?bid=418

Collaborative business modelsCollaborative cultureCulture changeMarketing 3.0Tourism marketing

It Takes a Culture of Collaboration to Deliver a Place Brand

We recently conducted a Tourism Assessment Review for a small city that discovered that its tourism performance was declining. This was an attractive small city with an historic downtown that had successfully established a state-wide reputation as a destination for antique shoppers. However, our research soon revealed that in addition to facing increased competition from online antique stores, the city’s antique stores were falling short of the “antiques capital” reputation.

It didn’t take long to realize that antique store owners were disconnected and totally focused on their own businesses, making little or no effort for cooperation and collaboration with other businesses or civic organizations. In fact, most store owners did not speak to each other and simply regarded the others as competitors. It seems that over time stores were sold and new owners came in and rested on their laurels in the belief that the city’s reputation as a favored antiques destination would sustain itself without any effort on their behalf. They didn’t realize that the reputation was created by the totality of antiques-related experiences in downtown.

This assignment carried several lessons for the city’s tourism performance. Firstly, the Internet can be a positive and a negative force for some destinations.  Secondly, sustaining a city’s brand identity, whether it has been formalized in a documented strategy or not, requires a concerted effort to collaborate, innovate and manage the promised visitor experience by everyone associated with the downtown.

Even though a downtown may have attractive architecture and well stocked stores, it’s the attitudes of residents and business owners that determine whether a place has a special sense of place and can elicit a sense of loyalty from visitors.  And once the culture of collaboration is successfully established, there must be a conscious effort to “pass the baton” to the next generation of merchants. As for being competitors, the merchants need look no further than a food court or freeway interchange to see fierce competitors working together to create a bigger “pie” so that they can all get larger slices.

This post is from http://citybranding.typepad.com/

Business model innovationCollaborative business modelsCollaborative cultureInnovationTourism trends

Serving up a storm

What the sharing economy has done to accommodation and transport, it is now doing to food and fine dining.

Peru has been top of my wish-list for many years, and while the country’s stunning landscapes and rich Inca heritage were an obvious attraction, my main motivation to fly for nearly 13 hours from London to Lima was the country’s food.

The country may be seem quite remote for those of us in Europe or North America, but its cuisine has been undergoing a steady rise in popularity in big cities around the world. With a heavy emphasis on fresh produce, unique flavors and local ingredients, Peruvian food (and drink) really does stand out as one of the world’s finest.

By designing my trip around opportunities to try as many different foods in as many different settings as possible, I joined the many millions of travelers globally who are putting food at the center of their travel plans. This megatrend has certainly caught on around the world, to the extent that in its 2016 Megatrends report, Skift declared food as ‘the leading hook in travel’.

Increasing numbers of destinations and travel businesses are responding to this demand by using food to transform their brand image: just think of Copenhagen’s promotion of Danish cuisine on the back of the top-rated restaurant Noma, or the many airlines that are upgrading the food and drink they offer on board, flying dedicated chefs between continents to keep their customers happy and well-fed. Brand transformations and new food-tourism concepts are springing up on a daily basis, all fueled by mobile devices, P2P platforms and social media. Events that bring new places to eat and drink to the fore, such Dine Athens Restaurant Week by Diners Club bring locals and visitors together to share new food concepts every day. With so much going on, it can be hard to keep track of it all!

It’s time to come to terms with the fact that, just as with accommodation and transport, more and more individuals are starting to offer services and experiences directly to visitors, bypassing traditional tourism businesses such as bars and restaurants. Examples include meal-sharing platforms such as Withlocals or Eatwith, but there are many other platforms offering other concepts that connect travelers with food and drink. Just as we’ve seen with accommodation, the rapidly-growing numbers of travelers who go to strangers’ houses for dinner do it not for the novelty, but because they see it as part of their way of life. Consumers are also increasingly interested in their own diet, fitness and where their food comes from. These provide just a few reasons why this phenomenon is here to stay.
If increasing numbers of travelers are buying experiences directly from local people, and discovering the destination through the eyes of a local, then doesn’t it make sense for destination management and marketing authorities to get involved? Local people are rapidly becoming part of the destination’s brand and are taking on the promotion themselves.
While we believe that this is definitely something to be celebrated, it does raise some difficult questions over the role of local authorities in formally involving these local people in their destination marketing and management, as well as how they can ensure quality and safety for visitors. We understand that these are big questions to handle for DMOs that are short on time and resources, especially since the world of P2P platforms, their listings and partnerships grow and change so quickly.

To help answer these questions, last month Toposophy in partnership with European Cities Marketing produced a free, practical guide for DMOs on how to successfully integrate sharing economy services into what they do, and use it as a tool for improving how they manage destinations. It also gives tips on how to form partnerships with existing platforms, something which can potentially cause conflict with ‘traditional’ tourism service providers if not handled properly.

With this in mind, here’s a summary of the presentation to the CityFair audience in London:

  • Get involved: The sharing economy is here to stay, and consumers are rapidly converting to using the many services on offer. It’s in your interest and theirs to join the conversation.
  • Do an audit: Do a deep analysis of P2P platforms to understand how your destination is being promoted by local people, and how this fits (or not) with what you’re already doing
  • Set your policy goals: Thinking beyond tourism, what are your organization’s policy goals for local people, and how can you use P2P platforms to help support these through providing tourism services?
  • See the sharing economy as a useful management tool: Check out our detailed infographic to discover how the sharing economy can boost the visitor experience, as well as improving city management and local social cohesion.
  • Build partnerships based on your goals: Work with platforms and partners that are aligned with the policy goals (note: they’re not always directly linked to tourism experiences) that your organization wants to achieve. It’s fundamental to put local people first.
  • See tech as a way of putting your local cuisine on the world stage: Whether through events such as the Restaurant Week we ran in Athens or working with tour-guide apps to bring people to specific places, tech is providing a window for something that’s unique to your destination: the food, drink and the people who create it.

This blog post is from     www.toposophy.com/insights/insight/?bid=428

Collaborative business modelsIntelligenceTourism trends

How Airbnb has given local restaurants a boost

The AirBnB phenomenon was not a completely ground breaking concept. The concept of staying at a guesthouse and kipping in a spare room has been around for for centuries. The Pubs and Inns of the 1600’s often had a room for weary (and drunk) passers by to rest their tired souls in exchange for a shilling or two.

What AirBnB has done so well is use technology to make it easier for this to happen in advance of a stay and allow those who have not thought about renting out a spare room or making a little extra cash, to do so.

The slogan they use of “ Live Like a Local” is something that I really like and something that I certainly did when I backpacked through south east Asia. I stayed in a lot of guesthouses which not only made me feel at home, but also gave me an authentic experience that i talk about to this day.

If you look at my home city London, there are over 20000 beds available to rent on AirBnB and although it is a threat in many ways to the hotel and hostel sector in regards increased stock, I think it has led to a new positive shift for other hospitality businesses.

For me living like a local doesn’t mean just your accommodation…
It means the full experience. For me this starts with food (I am a food lover after all). Back in 2003, in the first guesthouse I stayed in , in Hanoi, the first thing I did was sit with the mother of the household, and have a cup of tea and a bowl of freshly cooked Pho. Amazing… and experience I still talk about to this day.

Fast forward to 2016, and you look at the boom in street food, food markets and pop-up restaurants in London and you can see the shift in food culture which in turn creates a new form of tourism where people want to eat, drink and sleep like a local! The full “Living like a local” experience.

I found an awesome BBQ joint when on a business trip to De Moines, Iowa (Called Jethrows in case your interested, 8 types of BBQ sauce, amazing Ribs & featured on Man Vs Food!) by going on Facebook and using the “Near Me” functionality and could see great ratings by people who I didn’t know but were probably “locals” . I in theory asked the local crowd where was good to go and that answer was delivered to me.

Those restaurants and food outlets that are aware of the shift in travelers demands, and are active in their restaurant marketing , must be finding a new wave of different tourists (not always from abroad!) that find their local venue through the web, word of mouth, social media or food bloggers insights. Restaurants and other foodie places offering unique and authentic experiences, alongside quality service and food, will be a success in my opinion.

I think there is an opportunity for more strategic thinking between the likes of AirBnB and gastronomic outlets in regards encouraging the “eat like a local opportunities” to their customers rather than traveler being lured into the big branded places.

I think the opportunity is there for smaller restaurant operators to really fly, as long as they make themselves accessible through simple marketing and provide consistently authentic experiences to their customers to make them feel like a local, whether they are or not.

This blog post is from  www.toposophy.com/insights/insight/?bid=433

Business model innovationCollaborative business modelsMarketing 3.0StrategyTourism trends

It’s time for DMOs to take the leap on the sharing economy

The sharing economy is booming, but until now most European DMOs have largely stayed out of the conversation, seeing this new economic model as a cluster of problems, rather than as a useful tool to meet their policy goals. It’s time to turn the tables and get involved.

For many European destination marketing & management organizations, the sharing economy is regarded variously as a source of conflict, a fascinating (if frenetic) economic model, a shadowy way for some to make money, or just a plain headache. This is quite understandable, given the near-weekly emergence of new products and platforms, the anger expressed by many of those running traditional tourism businesses, and the uncertainty around rules and regulations. Activities such as short-term apartment rentals don’t just concern the city tourism board: housing, planning and taxation departments also have good reasons to be interested in what’s going on.

While the challenges can at times seem overwhelming, it is still a fact that the sharing economy is really just becoming the new rental economy or, in some respects the collaboration economy. Consumers love it, and the types of people who are getting involved are becoming more and more diverse. Private tours, home-cooked meals, apartments and other tailored experiences for travelers are becoming more exclusive every day! The main thing however, it that it just works. Barriers to becoming a ‘user’ or a ‘provider’ in the sharing economy are low, and the platforms are generally attractive and user-friendly. As a movement, the ‘collaboration economy’ is enabling citizens to cooperate, meet, solve problems and share local resources like never before.

This month’s Annual General Meeting of European Cities Marketing in Madeira took the theme ‘Dare To Share’ reflecting the desire of ECM members to engage with the sharing economy. With DMOs facing so much pressure from all sides to do more with less, engaging in a serious way with the whole concept of the sharing economy can sometimes seem too daunting for a simple city DMO to take on. At the same time, it’s perfectly clear that it isn’t going to go away, and that consumers are using it as a normal part of their daily life at home, and while traveling.

It’s time for DMOs to turn the powerful aspects of the collaboration economy to their advantage and take the leap. After all, many DMOs are under pressure from reduced budgets and higher expectations to participate in local economic development. They’re also increasingly expected to manage the destination, rather than concentrate purely on marketing. As we illustrate in the infographic below, the sharing economy can, in fact, provide a very useful tool for managing cities in a smart way, while improving social cohesion and enhancing the visitor experience.

While we believe that the sharing economy can offer real opportunities for city tourism authorities, it is however vital not to ignore one group of people: local residents. Local people provide the secret ingredient to great, authentic product development and marketing. At the same time, it is essential to ensure that sharing economy activities don’t impact negatively on their quality life or cost of living for the wider population. P2P platforms can open up the destination to new types of travelers and provide a valuable source of income for local people, however there is a darker side to this activity. Many are used by unscrupulous companies and individuals to evade safety rules and taxation, and platforms are accused of unfairly hoarding data when it could help in enforcing compliance with local laws.

Therefore, working closely with other government departments, DMOs have to ensure that when building partnerships with platforms, or even building their own, that they put their local people and policy goals first. To help DMOs understand how to ‘take the leap’ in a responsible, informed way, we’ve set out a seven-step guide.

This blog post is from    www.toposophy.com/insights/insight/?bid=427

Collaborative business modelsCollaborative cultureEnvironmental sustainabilitySustainabilityThird sector and social sustainability

Voluntourism, beyond responsible tourism

Responsible tourism, Voluntourism, Sustainable tourism…are different concepts with a common idea: the tourism activity in which the visitor brings positive impacts to the destination, either to alleviate poverty, to help in the development of the local economy, rebuilding areas affected by natural catastrophe, etc.

With regards to the kind of people interested in these types of tourism activities, they are not all moved by the same motivations and goals. The visitor travels either passively (holiday trip + sightseeing), actively (holiday trip + volunteering) or as a volunteer (volunteering trip).

Nowadays, Latin America and Asia are the continents offering most of these programs. There are both outbound and incoming travel agencies specialized in this type of tourism, and some tour operators have developed business units based on responsible tourism, whereas in Africa volunteering holiday programs are more popular than responsible tourism programs.

Also in Eastern Europe some countries are discovering in this type of tourism a new source of revenue for its poorest regions. Other Western countries such as the USA, Germany, France, Spain or Italy have also included strategies for the development of volunteering tourism products in their tourism development plans.

These type of holiday programs let the visitor truly discover the local culture, staying in local homes or accommodation facilities managed by locals, visiting the destination and cooperating in different social projects. Some examples may be:

  • Helping in building homes for refugees or in the poorest areas of the destination
  • Working as a teacher in primary schools or supporting in sport camps for children
  • Cooperating with an NGO dealing with the victims of a natural catastrophe
  • Participating in an ecotourism program where to work in the preservation of the environment

Some portals like Xmigrations.com work as a search engine for activities and accommodation where you may find nature, sport and spiritual activities in places where you can work in exchange for a free stay.

http://www.visionesdelturismo.es/turismo-solidario-y-volunturismo/

Business model innovationCollaborative business modelsCollaborative cultureInnovationTourism trends

Dinner at my home? It’s 30 Euros

What is a SMART destination? These may be defined in many ways. They are destinations that think and advance strategically, improving competitiveness and searching positioning through effectiveness. Becoming a SMART is no more than a strategy to enhance the destination value by leveraging both the cultural and natural heritage, developing innovative resources, improving the efficiency in the production processes and the distribution, which finally propels the sustainable development. This transformation generates positive effects in all sub-sectors such as energy, health services, security, culture, etc. thanks to the cross-destination impact of the tourism activity.

The key concepts that set SMART destinations apart from conventional ones are accessibility, innovation, technology and sustainability. Among these concepts, new technologies are the ones which are more likely to be perceived by the tourist, namely mobile applications, augmented reality and everything related to data smart management.

There are 4 key concepts upon which Smart destinations are developed:

  • Technology/Big Data
    • Innovation
    • Sustainability: social, economic, cultural and environmental
    • Accessibility

The development of the SMART concept in destinations consists mainly in working to attain a higher profitability in the daily exploitation of the resources. This is to be achieved by engaging both the local community and the tourists in order to enhance interaction between them. There are already some examples of Smart destinations, such as El Hierro island in the Canary Archipelago. Some of its main achievements are the energetic self-sufficiency and the pollution reduction, which have been achieved through actions such as:

  • Waste converted into energy
  • Environment camouflage of telecom and energy facilities and equipment (solar panels, antenna, etc.) within the landscape.
  • Reduction of the visual impact in the buildings and facilities construction, by using local volcanic stone instead of bricks.
  • It has gained awareness and branding by sharing and marketing its experiences in the social networks.

Other actions carried out in SMART destinations encompass:

  • Mobile Applications
  • Tourism Intelligence System, including data transportation and information Smart management, which altogether turn the destination into a SMART destination.
  • Smart office; a common working place where to unify processes which produces a work synergy and allows sense and common methodology guidelines in the transformation towards an intelligent city.
  • Beaches with free wifi

It is important to mention Singapore Smart City, which is on the way to become the first SMART nation worldwide. The country is working on its Master Plan for the next 10 years, which will be focused on the development of smart communities propelled by integration and innovation.

This blogpost is based on http://www.visionesdelturismo.es/smart-destinations/

Business model innovationCollaborative business modelsInnovationTourism trends

Guides that are not guides

As has happened with the accommodation business, namely with Airbnb, the collaborative platform business model is also developing in the tourist guides business. I have personally experienced one of these platform’s services in the city of Prague.

Thanks to these platforms it is no longer strange that the tourists are offered free guided tours in great urban destinations, without any trick. In my case, I used the services of Sandeman’s New Europe, which is already present in 18 cities. At the beginning of the tour, the guide explained that his income comes from tips, and so it was not mandatory to pay even 1 Euro.

The tour lasted more than 3 hours and it was really entertaining, with good quality content. The guide was brilliant and received quite a lot of tips. But, attracted by the quality of this Guided tour, the day after I did another one, but paying. This business works actually like a freemium model.  In fact, there are many more businesses offering free guided tours in Prague. And they have their rivalry moves, like guerrilla marketing actions, competing for the best locations, etc.

But this new fashion not only takes place in the large cities. The Greeters movement is emerging also in smaller cities, like Bilbao. The first company operating this business model in Bilbao is actually called Bilbao Greeters, and is part of the international network Global Greeters Network. The Greeters are locals offering guided tours with the authenticity of a local resident’s knowledge and perspective, who knows the traditions, habits and secrets beyond the usual tourist information available. In the Basque Country the Tourist Guides are not regulated, and so there cannot be any conflict in this case. Unlike in the previous case of “New Europe”, the Greeters are not professional guides and do not accept tips.  However, to make a booking you need to be registered as partner, which costs 12€ per year.

Finally, there are many online platforms allowing people to offer their tourist services worldwide. Besides platforms such as Vayable, Viator or Isango, marketing all kind of experiences –from guided tours to cooking lessons-, there are many others offering guided visits by the destination’s residents.

Local Guiding is a platform oriented to “changing the way people travel, experiencing the local life as it is, not like the conventional tourism agencies pretend it to be”. They are already offering guided tours in more than 20 Spanish destinations.

Tours by locals are the veterans in this sector, as they have been operating since 2008 from their headquarters in Vancouver. They nowadays offer guided tours in many countries worldwide.

Like a local is the concept developed through a mobile application. Destination residents contribute to editing the local guide with recommendations, advice, routes, etc. and obtain revenue from the application’s management firm.

Finally, there is the Spanish portal called Ciceroner , promising to offer “unique and personal experiences, the only ones that can be really different and memorable”. It is still in Beta development phase, but it already offers a considerable amount of products in many destinations. It gives the option to gift the guided tours just like Smartbox and many others, but promising a superior experiential value.

As we can see, it is an emergent business model, with many suppliers and intermediaries operating in the market. However, this new fashion business model arouses many questions:

  • Is it just a fashion or a new reality?
  • Are these services for specific segments or for all types of visitors?
  • Is it necessary to further regulate this type of businesses to ensure a fair competition with the traditional models, or should they be given free regin instead?
  • Are these new models going to operate in urban destinations only, or they are likely to operate in beach destinations traditionally dominated by tour-operators?
  • Do these business models affect somehow the destinations’ image? Should the DMOs do something to get some profit from it or to manage it for branding purposes?

I invite you to reflect upon these questions, and encourage you to give your opinion

This blogpost is from http://www.visionesdelturismo.es/guias-que-no-son-guias/

Business model innovationCollaborative business modelsInnovationMarketing 3.0Strategy

The innovation challenge in destinations

Research and innovation will have a fundamental role in the competitive improvement of destinations. Any policy for the destination development has to include a vision and an innovative orientation that brings some sort of competitive advantage.

In the Spanish economy, the tourism industry has proved to be one of the most dynamic sectors, which generates multiplying effects in the local economies in all sub-sectors directly and indirectly related to tourism. This multiplying effect together with the sector’s evolution worldwide has contributed decisively to increase competition, which in turn makes the industry develop strategies oriented towards the improvement of its competitiveness.

The new market after the changes in the offer and demand, requires tailored services and activities, with high quality standards, which makes attaining customer satisfaction more difficult than ever before. In this regard, tourism offer has to be organized according to the targeted market segments requirements in order to be successful. Unlike in past times, market penetration, promotion, price setting, product quality and quantity are variables defined by the demand and not by the offer, for it is necessary that the service and activity production in the tourism sector takes into consideration this new scenario, and so new destination models restructuring the links and relationships between stakeholders are being developed.

In any case, research and innovation will have a fundamental role in the destination’s competitiveness improvement. Any action for the successful development of the destination has to include a vision and an innovative orientation that can generate some kind of competitive advantage. The main challenges to foster competitiveness in destinations are the following:

Innovate in mechanisms and cooperation formulas and strategic partnerships. It is basic to develop mechanisms that work both from the public and the private scope, to boost new cooperation models between businesses and public-private partnership, as a way to gain profitability, dimension and commitment in the development of the tourist sector.

Innovate to improve the sector’s competitiveness. There should be techniques and strategies to improve the business and the destination’s competitiveness. This includes the development of Innovation Plans for the improvement of business models, management models, service processes and the destination’s business marketing.

Innovate for the introduction of new tourism products and consolidating the profitability of the current ones. It will be necessary to foster the creation of unique tourism products based on new business models, build upon the capacities and unique resources of the destination, with a high experiential value, using the ICT and being socially and environmentally friendly.

Leverage the resources and hidden heritage. It is crucial to develop new formulas for leveraging tourism resources that are complementary to the traditional ones, unknown or unexploited, so as to achieve the profitable consolidation so long as they create an outstanding experience and expand the revenue streams.

Innovate in destination’s promotion and communication formulas. There is nowadays a communicational saturation, which makes it necessary to face the future with promotion innovative mechanisms which allow optimization of the destination’s visibility.

Innovate in tourism product marketing. There will have to be developed new methods and tools to market tourism products, in order to favor the sector’s competitive improvement and control the dependence on external channels, in a way that guarantees some influence power. In this context, it is fundamental to develop strategies to improve the intelligence and the knowledge of the products and its results, and the client and its consuming habits.

Innovate in client relationship formulas. The strategy will have to develop new client management formulas. Starting up innovative mechanisms to do CRM is vitally important not only to retain clients, but also to achieve a more effective marketing.

This blogpost is from http://www.visionesdelturismo.es/innovacion-de-los-destinos-turisticos/

Business model innovationCollaborative business modelsCollaborative culture

Collaborative tourism: is it an original business model?

When we talk about collaborative tourism or tourism peer to peer, we refer to a new trend in the way of traveling based upon sharing basic resources such as accommodation, transport means or personal experiences with other travelers through platforms where the host publishes his/her offer and the tourist makes the booking.

Theoretically, this phenomenon comes from the collaborative economy model, where consumers may also become suppliers by sharing their means with other consumers, also operating on a global scope, prioritizing human relationship above competition and selfishness. The presentation results in being attractive to more and more tourists, who do not really know the business model completely.

Due to the constant transformation of the virtual economy, the task of identifying and describing virtual business models has turned to be quite hard. However, since this P2P platform business model usually determines it’s success, it is no longer unknown: platforms meet the needs of both supplier and buyer, and take a commission from the booked services price.

Checking the four main collaborative platforms operating in Spain for the four types of services available (eating, accommodation, transport and experiences), we find that their revenue sources are not so different from the traditional tourism intermediation models:

  • AirBnB: charges a commission between 6 to 12%, plus 3% of the conversion rate.
  • BlaBlaCar: depending on the amount of the transaction, it charges 1,60€ for transactions from 1 to 8€ or a commission of 20% for transactions of more than 8€.
  • EatWith: it takes a commission of 15% of the transaction.
  • Trip4Real: it takes 25% of the transaction.

A similar procedure is used for any other tourism intermediary, such as a travel agency, a tour-operator, broker, etc. The difference remains in that these intermediaries comply with the regulations in terms of safety, health and taxes, whereas most of the accommodation and transport means offered in the collaborative platforms do not comply with them.

Therefore, the consumer of collaborative platforms pays a lower price due to the non-compliance with the aforementioned regulations, and takes the risk of suffering any kind of accident without the safety prevention means. Furthermore, despite the social sharing philosophy upon which the platform is created, many suppliers operate for profit rather than for the aim of sharing cost or experiences. However, this is difficult to prove and control.

The hospitality sector’s opinion. The outburst of the tourism collaborative platforms has transformed many housing apartments into competitors for the hotels and regulated tourist apartments, and so it has turned into an important issue for the Public Administration.

According to the Spanish Confederation of Hotels and Tourist Apartments, there are only two possible solutions to this conflict: the total banning of the platform operations –as has happened in many major cities-, or the obligation for the apartments to comply with the same regulations as the current regulated tourist apartments.

It is necessary to take into account that the tourism sector in Spain is hyper-regulated. There are around 250 regulations at the European level referring to intellectual property, consume, safety and payment means, plus those from the local administration. All in all it entails a great deal of costs that do not apply to the collaborative platform operators, including the VAT, the police files, fiscal and sanitary costs. This is clearly a case of unfair competition. In this regard, there are many points to consider:

  • The regulations applying to these tourist housing apartments are different for every region in Spain, for it is necessary for the destination regulators to study them all in detail.
  • It is necessary to consider the product separately from the platform, taking into account that the platform operation is similar to the traditional channels such as the travel agencies, and so the same regulations should apply.
  • The evolution of the global society is likely to propel this paradigm beyond the current conditions, demanding solutions in terms of adapting the new regulation and policies.

This blogpost is from  http://www.visionesdelturismo.es/turismo-colaborativo/