OPPORTUNITIES AND CHALLENGES FOR TOURISM CITIES UNDER THE SHARING ECONOMY
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1 International Mayors Forum on Tourism Zhengzhou, China 2018 OPPORTUNITIES AND CHALLENGES FOR TOURISM CITIES UNDER THE SHARING ECONOMY Robert Travers for UNWTO Belt and Road Tourism City Mayors Summit
2 Building the new Silk Road for Tourism Marketing and promotion Destination management and capacity building Travel facilitation
3 The Sharing Economy is here providing transportation services for more than 450 million users across over 400 cities in China.
4 Change is a driver of growth New products, markets and segments and the transformation of existing ones: New, different, better or better value for money products and services Increase in choice, further differentiation, diversification and sophistication Enhanced user experience Use of economies of scale and lower costs Increased productivity Increased competitiveness
5 New platform tourism services UNWTO concept: Business models in which private individuals offer goods or services to visitors through digital platforms. They span the tourism segments of information, accommodation, transport, gastronomy other tourism activities. These products or services can be offered by private individuals or by commercial entities and distributed (intermediated) via digital platforms that match demand and supply.
6 Communication, collaboration, cooperation and coordination Cities and destinations, as well as established tourism operators, can work together with platforms to mutually benefit from the opportunities generated
7 UNWTO research 2017 New platform tourism services are important and are expected to continue growing in importance in the coming decade. Despite the challenges, the positive impact of new platform tourism services outweighs negative effects. The opportunities generated should not distract from the pressing need to address the social or environmental challenges created by the new platform tourism services.
8 UNWTO recommends Cities should distinguish between: 1. Services that do not generate an economic benefit beyond the recovery of costs and generally involve only occasional economic transactions, which can be considered as true sharing. TripAdvisor (with regard to user-generated content); Hospitality exchange via platforms such as Couchsurfing Longer-distance ride-sharing services.
9 UNWTO recommends Cities should distinguish between: 2. Services that generate an economic benefit beyond the recovery of costs and generally involve frequent or systematic transactions, which can be considered a commercial activity by private persons or entities.
10 Opportunities and challenges Innovation and convenience Better informed choices Destinations and companies Better experiences remain competitive. More flexible than traditional Many cities have moved to tour-operator recommended become fully ICT friendly packages. New segments of demand Better customer feedback. Higher standards Cost of hotel inspections reduced
11 Opportunities and challenges Traditional businesses feel threatened They claim unfair competition, possible threats to health and safety, tax evasion, environmental obligations and liability issues Neighbourhoods can be changed from residential to tourist as homestay grows. Overtourism and severe congestion. Dealing with misinformation on websites can be timeconsuming and costly.
12 Opportunities and challenges Authorities fear losing control of tourists, and tourists may put themselves in danger. Enforcement challenges: tax obligations, fire regulations, registration of commercial activity, and the liability of platforms to actively cooperate in the enforcement of existing rules. Many SMEs lack skills to manage ratings and capture the opportunities DMOs are likely to have an important future role in helping their members to adapt.
13
14 The Sharing Economy is facilitating demand, but not driving it
15 The governance challenge Many governance actions needed are not unique to tourism services, but rather in the fields of consumer protection, security safety and hygiene, insurance, and taxation
16 The governance challenge Response varies depending on cities political agendas. In some cities: Platforms collect taxes directly for each reservation. Governments have approved legislation allowing property owners to rent out their private homes Others have banned commercial home rental altogether
17 The governance challenge Some cities use destination thresholds to differentiate between occasional accommodation providers and commercial providers. 90 days in London, 120 days in Paris German cities use misuse regulations to control letting Malta Tourism Authority runs educational and promotional campaigns to encourage legalisation
18 Way forward UNWTO recommends that cities should: Gain understanding and monitor new platform tourism services Rethink regulation and address the interests of all stakeholders involved tourists, workers, providers, platforms, competitors, and local communities Adapt to the market changes based on communication, collaboration, cooperation and coordination.
19 Thank you Robert Travers for UNWTO Report available at UNWTO E-library:
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