Who Owns The Experience?
July 18, 2011 by Alexi Huntley Khajavi
Consumers are frequently becoming the sellers: what’s that mean to the customer experience?
While I was in San Francisco last week, I had dinner with friends in Berkeley. After dinner one offered me his empty apartment to avoid the drive back to the city. It was a nice gesture that ultimately ended up falling flat when he gave me the wrong key. No worries, we're friends remember. I ended up just driving back to the hotel, got to my room, put the key in the door and… it opened. Professional.
Earlier, at dinner we had talked about the changing dynamics of consumerism and the advent of what is commonly referred to as collaborative consumerism. A trend where consumers swap, barter and sell things to each other via social networks and mobile devices rather than with a retailer at a physical location.
A few of those at dinner work in travel technology and their excitement was all about the return of venture capital and the Initial Public Offering for the companies they work for. I worked for a travel dot com during the boom and bust of the late 90's and Im not bullish on the sequel.
Home Away was one recent IPO that had an impressive debut. Shares in the company rose 49% on the first day of trading, valuing the company at just over $3.2 billion, yes that's with a B. That's a valuation of 19x revenues (2010), to give a comparative, Priceline trades at 8.1x revenues and Expedia trades at just 2.3x revenues.
Home Away has been successful, at least they earn a profit. 90% of their revenues come from the homeowners who pay to have their homes listed. Certainly, some of their success is due in small part to the over supply of secondary homes in the US and internationally. I wonder how many of those rental homes are actually in foreclosure?
Other travel technology startups flying high are AirBnb and Getaround, both companies leverage the concept of peer to peer sharing and rental sales of private rooms, homes and cars.
However, as the wise woman said, shit happens. And it happens a lot in travel. You get the wrong key, for example. Who do you turn to when you rented a house from a guy that is 3000 miles away? It's not just about customer service, more importantly it's about the customer experience. There is a surge in travelers wanting a more personalized experience that is authentic and spontaneous.
This type of structured spontaneity must be managed diligently and not by a vacant landlord. More people are vacationing to get in touch with not only themselves but with the locals, the environment and even the proprietors. Hence the rise in popularity of farmer’s markets, people want to meet the farmer that grows their food.
I like the idea of buying directly from my peers. I'm just not convinced that travelers are going to get the experience they expect from John Smith selling a vacation in his spare time. And a travel site that brings these people together is not in the business of creating memorable experiences, but rather transactions. The business of travel is about getting it right throughout each stage of the consumer journey: Dream - Plan - Buy - Experience - Share, what happens to the experience when there’s only occupancy at the Buy stage?
I have built and owned 3 hotels in Costa rica (Alex, you know me an dyou know this) I also do a lot of house exchanges with my home in Granada, Nicaragua . Your article brought up a very valid point….as good as it all can be, LOTS can go wrong. It seems you are using your head to “fix this void” . wow, more power to you Im in the small upscale boutique hotel business and yoga center…...and I think that the ability to stay in the FRONT is a true challenge today. With the economy in distress and the joblessness around the world, we have to come up with a good product: that means a great expereience, an economically feasible one, amazing service and allwith a “high touch” feeling. Im very curious how you see this unfolding…..
thanks for including me. Hope all is well with your family, Alex
Warmly
susan Money
owner Pranamar villas and yoga center www. pranamarvillas.com
Hi Susan,
Great to hear from you. Hotels like yours are exactly the kind of hands-on experiential experts I was referring to in the post. Your success has been in delivering a very high quality, highly personalized service among an extremely low impact, authentic designed hotel. You let the place and the interaction between the guests with the locals, the food, the surf, the environment craft the level of service, NOT an amenity saturation of flatscreen tv’s and silly gidgets and gadgets you don’t need in the tropics.
Keep up the good work.
I spent 6 months in Europe travelling on my own and had the authentic experience you’re talking about. I stayed only in the rooms of local homes and ate dinners at the table of my hosts and their families. It was amazing – you get true insight into a culture when you see what they do and how they act as the sun rises and sets and you can mesh into their daily routines. I also sought out homes that had cottages or bungalows onsite where i could spend time w/the family and then escape off on my own when necessary. Of course this is the perfect way to travel but it wont work for everyone and certainly isnt a solution for families that crave an authentic experience. I come from a family of 8 and I doubt, worldwide, there are too many homes in the world that have 6 spare beds to host someone.
On the flipside, while in CR, a large number, if not all, of my friends had rental properties and /or used their own homes as rentals/exchanges around the world. Being a former innkeeper, a great many of them turned to me for advice on how to provide their guests w/info on tours, events, restaurants and I worked with them to create info books and tour pages for their guests upon arrival. Perhaps, if these sites that are in the business of brokering vacation rentals and exchanges could educate their clients on how to create a positive authentic experience via templates, examples and even how-to vids, that might bring us a step closer to making this medium more valuable.