Summary

Companies that operate in the sharing economy don’t own assets and don’t provide services directly to consumers; they function as third-party clearinghouses, enabling property owners and individuals to monetize their unused assets and time. Airbnb has achieved tremendous success in the sharing economy for rooms and encroaching in a market that has been dominated by hotel brands.

In their latest installment of our Edge Strategy™ series, L.E.K. Managing Directors Alan Lewis and Dan McKone examine the growth of Airbnb within the context of the sharing economy, assess the threat it poses to traditional hotel brands, and show how these companies can employ an Edge mindset to beat Airbnb at its own game.

Traditional hoteliers can ignore the widespread threat posed by Airbnb and risk losing customers to the new model, or they can share in segments beyond the millennial vacationer and face Airbnb head on. Either way, the hosting model is growing in popularity and disrupting the old model, thereby expanding the dimensions of the evolving sharing economy.

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