The Future Of: Travel [FULL PODCAST EPISODE]
Jess: This is The Future Of, where experts share their vision of the future and how their work is helping shape it for the better. I'm Jessica Morrison... David: And I'm David Blayney. Jess: Home sharing platforms like Airbnb have changed our holiday plans. Many of us are shunning tourism hotspots and instead preferring to undertake immersive experiences that make us feel like a local. To learn more about this phenomenon, with us today is Dr Michael Volgger, Co-Director of Curtin University's Tourism Research Cluster. Thank you for joining us today.
Michael: Thank you very much for having me. Jess: Firstly, why has Airbnb had such a profound impact on travel? Michael: Yeah, that's very correct that it has had a profound impact. We need to recall, I guess, that it was only founded in 2008 and for Australia it only really arrived around 2014, 15. If we observe the figures and the growth since then, that's really impressive. We had about two per cent of international visitors in 2015 booking Airbnb when they came to Australia and and this went up to approximately 10 per cent until the end of 2017 – from an almost negligible figure to a significant share of it. So, I think there are many reasons. Let me point out, I guess at least three of them. The first and most well-known and most discussed one
will be the experience – I call it the 'experience hypothesis'. It's the opinion that Airbnb offers a more authentic, more unique holiday experience to visitors. Michael: Airbnb celebrates diversity. It does not apologise for inconsistency and therefore it is great for having a unique experience: you can book a castle, you can book a treehouse, you can even book an island through these types of platforms. And thirdly, there are also the amenities and the size of the apartments, which can be very attractive to some types of travelers. Consider families or groups of friends. Yes, you can go in a hotel, but
usually you get distributed across a number of rooms. It's not ideal. In an Airbnb, you can stay all together in an apartment, in a house; you have a washing machine there, you have cooking facilities. So, from that point of view, I think practical advantages do play a role. Jess: How does the impact of Airbnb or other
home sharing platforms differ around the world? Michael: It's a fairly global phenomenon, I would say. It obviously started in Western countries, out of San Francisco actually, then it boomed quite soon in Europe, in the US, and Australia. But today it's really global. It's present in more than 190 countries, 100,000 cities. It's literally everywhere. But there
are some latecomers. The growth markets for Airbnb, including China, India, were a bit difficult for them, as, for example, China often is for Western companies, especially the digital ones. Consider Google, consider Facebook. Airbnb tried hard to fulfill all the requirements in China. They founded a local company called 'Airbnb China'. They changed the name into 'Aibiying', which in Chinese means 'Let's welcome each other with love'. And they implemented a lot of particularly Chinese features like the Alibaba payment systems, integrated WeChat and that sort of stuff. Michael: So they are hoping to really get off the ground in China. India is difficult
and different. Again, it has been dominated by a budget hotel company, Oyo, which owns a lot of budget hotels, which therefore made it more difficult to conquer the budget market. Airbnb chose to partner with them. It's a two-way partnership. Oyo wants to enter the US so Airbnb may help them over there and Airbnb wants to grow in India. And Oyo might
be a good partner for that. So yeah, different dynamics in specific countries. But overall I would say it's pretty global. David: In some parts of the world, local governments have been perhaps a little reluctant or a little hostile towards Airbnb, particularly over zoning, fire safety, that sort of stuff, where they have been operating in a space where hotels had been operating but not been subject, I guess, to the same rules. Are we going to be seeing this sort of maybe toned down over time, as governments become more accepting of Airbnb? Michael: Well, you are correct. There were,
and are, some governments, more particularly city governments actually, which try to limit the phenomenon. I would say it's due to two reasons: they don't want to see a 'pricing out' of the long-term rental market. And secondly, some of these places feel like they have enough tourism, like Barcelona, Venice, typical places like that. They want to have control over that tourism development so those are the main reasons and they try to do something. San Francisco, where Airbnb comes from, is relatively restrictive. New York is relatively restrictive. Barcelona, I mentioned it. Japan recently made their short-term rental laws
much tougher and which led to a delisting of a majority of Airbnb offerings in the short term at least. Michael: So yes, some governments do try to limit the phenomenon, but overall I'm not seeing a big movement against it. I also feel that a couple of years ago there was more reluctance among public players, among governments, to act... These platforms, and in particular, Airbnb, have always pushed the storyline that they are too big to be stopped and there might be some truth in that. So I feel governments increasingly are becoming more accommodating and Airbnb has always been very careful in managing that type of relationship because they do know that's a very critical point in their business model. David: So that's similar to Uber, for example, where it started off being illegal and now it's slowly become this inevitable part of how we get around. Michael: Yeah, I think Uber had it harder
in some places to get through because the taxi lobby in some places is politically very strong. There were some more discussions around labor arrangements and you know, around Uber and how people are paid and self-employment status versus being employed and those sort of discussions. We see that less with Airbnb, I guess. Jess: You touched on why people are using these platforms for accommodation and one of them was around people having local experiences. Why is it important for people to have these local experiences when they go on holiday? Or, just for work when they're away? David: Cause I mean, I've never stayed in an Airbnb. I'm one of those Luddites who always
stays in a hotel, some cheap hotel. What are simpletons like me missing out on? Michael: I guess the local experience is not unique to Airbnb. So probably you're not missing out on anything at the end of the day. But there is a general trend towards this authenticity and local experience aspect. It's not new by the way. It's been around for some time, but I don't see any signal for it to stop in the medium term or to decrease in importance.
It is a critical aspect. People do tend to look for it. I think it's, to a certain extent, due to a general push of globalisation where places and also hospitality providers and tourism offers tend to become more similar. A hotel in Perth often looks similar to a hotel in London or in Johannesburg, in South Africa. David: And it doesn't matter how far away you go. You're probably gonna find, you know, the golden arches and all those sort of Western amenities.
Michael: Yeah, that's what I mean. It can be a bit boring sometimes, but people, and I think especially the new generations like millennials... 'We' – I include myself, although I'm borderline – do define ourselves to a certain extent through travel and through travel experiences. So having unique travel experiences, being able to share them with
our peers on social media. This has become an important element and having typical local experiences, that I think offers you a strong storyline to share with your peers. Jess: What do you think the future is of home-sharing platforms like Airbnb and others? Michael: In general? They are here to stay. Home sharing has not been invented by these platforms. It has been around for many, many years. It has just become accessible on a
global scale. And Airbnb by the way, was not the first one to do it – HomeAway and CouchSurfing are quite a bit older – so they haven't invented it as such, but they are the biggest one these days. In the future, and it started in the past few years already, these platforms and competitors will try to move into the centre of the market. So there's a convergence. What does it mean? Airbnb now also offers boutique hotels. It offers restaurant bookings, which really does not fit with–. David: What, so you're having food at some random person's dinner table or something? Michael: No, it's normally restaurants, which you can book. That's what I mean: it does not really fit with the basic idea of it.
On the other side, hotels are moving into this home-sharing thing. The biggest hotel brands like Marriott now have their own brands on Booking.com. Typically, a hotel booking platform also has increased, massively increased, their inventory of home sharing. So you can see: all of them try to move into the middle. They try to cover all. They try to become one-stop-shops of selling good experiences. David: What's next in terms of our travel
trends? How we're trending in that area? Michael: I think we need to mention technology. That's that's really impacting a lot. We discussed one aspect of it, which are these platforms and the peer-to-peer economy, but there's much more to it. It has revolutionised how we search for holidays, how we evaluate holidays, how we share our opinions about holidays, how we pay, how we book the peripheral aspects of a holiday. But what about the core experience? We may also see some changes there. I believe that it should be, or it will be, a human-to-human
interaction. But, robots are becoming more and more prevalent. In China and Japan in particular, we have hotels that employ more robots than human beings as staff, which is, I guess, fascinating on the one hand, but scary on the other hand. They do all sorts of stuff, from being receptionists, to waiters, to chefs in the kitchen, to bringing your luggage into the room. So that's one very strong movement to watch. It has a lot of implication for our holiday experience but also for employment in the sector.
Jess: Because it is such a massive sector when it comes to employing, what are we seeing overseas in terms of robots and are we going to see the same in Australia? David: Are we going to have a robot-led Contiki tour or something? Hopefully not. Michael: Yeah, hopefully not. I can only emphasise that, but I wouldn't exclude it. It's growing, although recently one of the hotels that are leading in that space got rid of some of the robots because apparently they are not yet there where they hoped they would be with their technical skills and those sorts of things. But yeah, I think it's moving in that direction. Robots cost less than human beings do. But I would ask: can they smile? Can they anticipate our needs? Are they really able to deliver that meaningful connection that we are looking for? Shifting a little bit away from the robots, I think there are even more useful integrations of technology. There is a restaurant in Shanghai: Ultraviolet. It consists just of a table in a wide room. It's just one table. It's run by a famous
French chef. They project images onto the walls, which accompany the food. It's a multiple course menu and if you get a specific type of food on the table, you will see certain types of images on the walls. You get the scent, which is linked to that. You get a sound, which may link to that. So you shift from an English forest into a tropical Indonesian context within a couple of minutes due to the help of technology.
David: So, we all love traveling – except for those of us who don't, I guess. [Laughs]. Jess: Who doesn't love a holiday though? David: I don't know. What's going to get us to stop holidaying? To get us to give up holidaying? Other than, you know, us not having any money I guess. Michael: Yeah. You mentioned an important thing, I think. Yeah. Looking at the development of tourism: since the 1950s it has been almost continuously growing. There was a slight stop or decrease in 2007, 2008, but other than
that continuous growth, we had 1.4 billion tourists last year; more than ever. And I'm pretty sure it will continue. What could stop that movement? I guess the desire is there to travel and the millennials even have it stronger than other generations, but I think the context could stop us. You mentioned household income. That's one aspect. Michael: I think it's interesting to think about what happened in earlier stages with travel and tourism phenomena, like ancient Rome. Why did they already travel at that
early stage? The Romans, they were quite wealthy, so they could afford to travel for leisure. They had good infrastructure. So this will count today as well, keeping, maintaining, good infrastructure. And they had the lingua franca, Latin, so they could communicate with each other and also it was relatively safe and secure at that time. So I think, those are the factors that we need to watch. What about our welcoming attitude towards other cultures? What about safety and security in the world? What about the middle class? In the future, will the middle class be able to afford travel anymore? That has some critical aspects, next to pollution and climate change. Tourism itself, I think you can make a contribution
to–. David: In some parts of Europe, they've... You mentioned before the taping that there's flight shaming in some parts of Europe. Is that gonna hit Australia or other parts of the world? Michael: I think, yes: I think it will hit the world. But there are varying frameworks; obviously different parts of the world are different. I don't see Australians heavily
shifting towards traveling by train in the near future between cities. Simply because it's a bit difficult and the distance and infrastructure is not 100 per cent there, but I guess there is a social pressure to increasingly justify having a heavy ecological footprint. This will stay and perhaps it will lead to interesting phenomena like colluding in hypocrisy between consumers and providers because today we talk about greenwashing of providers but perhaps in the future or even present when there is social pressure to not fly; for example, you mentioned the flight shame movement... There might be consumers happily buying in and colluding with some hypocritical statements from providers. So
there's also risk around the increasing social pressure around that stuff. Jess: Before we go, we hear you're working on a couple of books to do with travel. What are they about? Other than travel? Can you get into a bit more detail? [Laughs] Michael: I am co-editing two interesting books. One is on an atmospheric turn in tourism. I do like the concept of atmospheres because I think it captures the shift towards authentic experiences quite well. And there has been a lot of emphasis on product quality, on service quality or on specific elements of quality. But, I do think we sometimes lack an overall
perspective and the atmosphere, which is the kind of substance which flows between people and the place, is very fluid. It's hard to grasp but it's so important to deliver good experiences. Michael: It has to do with: what's the character of a place? Are we able to get it through? What about the different senses? It's not just about gazing at things, but it's using all our senses. It does mean also using the knowledge of different disciplines. It's not just about business or even just about ecology
insights, but it has to do with design. It has to do with architecture. Are we able to coordinate within a specific place a certain type of architecture that we are able to deliver that mood, that atmosphere to visitors? I guess that's the topic and the tool set that we are trying to provide with that book. Michael: Another one we are working on is on 'travel and tourism tribes', sometimes called 'neo tribes' to make clear it's not traditional tribes, although they have some similarities. There's a lot of debate around
tourists becoming more and more individualised and that's obviously true; it would be a great mistake to generalise a phenomenon and take just averages, but at the same time we shouldn't exaggerate on the individualising thing. I think the reality is sometimes in the middle and obviously we all are still collective beings and we define our values – what is important to us, how we define success, how we define failures – in some types of collectives. These can be called 'subcultures', if you like. We call them 'neo tribes' because they define, for example, what type of celebrities we are looking at. Think of cycling tourists; they will have their own communication channels, their outlets, their type of clothes they want to wear. The celebrities are looking at their events. The same is true with bird watching tourists. They have their own, you know, value set, which is not only linked
to tourism – it is bigger than tourism – and that's what we're trying to do. We try to look at these subcultures and want to understand how they influence the travel and tourism behavior of their members. Jess: Very interesting. Quite detailed and topics there around tourism. David: What tribe would you be in? Michael: I'm part of the cycling tribe, I admit. I love to cycle. David: What tribe are you in, Jess? Jess: Oh, I don't know. Probably family, soon.
David: I'd be hiking tribe, 'getting-lost-in-national-park' tribe. No, no, no. Not getting lost. Jess: Well, this brings us to the end of our discussion. Thank you, Michael, for sharing your knowledge on this topic. Michael: Thank you very much. See you later.
David: You've been listening to The Future Of, a podcast powered by Curtin University. If you have any questions about today's topic, get in touch by following the links in our show notes. Bye for now.