Effect of commercial neighbors on the online popularity of peer-to-peer accommodation-sharing properties

Abstract

Commercial hosts are becoming increasingly common in peer-to-peer (P2P) accommodation sharing. Yet the interplay between commercial and individual hosts has been unclear. This study investigates the effect of properties managed by commercial hosts on the individual hosts in the neighborhood. Specifically, we hypothesize that an increase in commercial properties, which have competitive advantages, would penetrate neighborhood markets and cannibalize the online popularity of individual properties. We test these hypotheses using a large-scale, longitudinal data set collected from a leading P2P accommodation-sharing platform in Beijing. The findings show that an increase in commercial properties is associated with a decline in the popularity of individual properties in the neighborhood. However, the negative effect of commercial properties is weakened when there is a higher price difference between the two ownership types and a higher density of tourist attractions. The implications for service operations and strategies for P2P accommodation-sharing businesses are discussed.