Accommodating the sharing revolution : a qualitative evaluation of the impact of Airbnb on Singapore’s budget hotels

Abstract

In 2013, Daniel Guttentag in an article titled Airbnb: Disruptive innovation and the rise of an informal tourism accommodation sector has proposed the view that Airbnb properties compete directly with budget hotels because of their comparably low cost and the present paper assesses the applicability of this hypothesis in the Singapore context. Interviews were conducted with representatives from economy/mid-tier hotels and hostels which account for over 10% of Singapore’s hotel room stock and with Airbnb. The researchers draw upon these key informant views to propose an Accommodation Price and Capacity Matrix as a theory-based mapping of Airbnb’s offerings within the context of Singapore’s accommodation landscape. It is concluded that although Airbnb should not yet be considered as a direct competitor for Singapore’s budget hotels, it will pose a growing threat through the near to medium term. The paper concludes with recommendations about how Singapore’s home rental market should be best regulated.