As the summer vacation season gathers steam, new revelations about the sharing economy are coming to light. In particular, millennials-who have driven the sharing economy to new heights-are beginning to revert back to more traditional services while baby boomers are embracing alternative travel methods in larger numbers.
Overall, the likelihood to use sharing economy services is down.
According to research from Allianz Global Assistance, approximately four out of 10 (41 percent) of Americans indicated that they are either "very" or "somewhat" likely to use them during their 2019 summer travels, compared to 47 percent in 2018 and 50 percent in 2017.
Gen-X is driving the downward trend, abandoning the sharing economy for more traditional travel services. Forty-one percent said that they will use sharing economy services this summer, down from 60 percent two years ago.
Millennial travelers are also leaving the sharing economy behind in large numbers; however, they still make up the largest generation of users. Sixty-three percent said they will use sharing economy services this summer-down from 77 percent two years ago.
While younger generations seem to be returning to traditional travel, baby boomers are now embracing the sharing economy in larger numbers. Twenty-four percent indicated that they will use these services, climbing from 19 percent two years ago.
The market still remains strong for its core customers, regardless of shifting demographics, but trust in the services of the sharing economy has declined.
Allianz's research found that while millennials are the most likely to trust sharing economy services (71 percent) that number is down from 76 percent last year and 83 percent two years ago.
Gen-X is also less likely to trust these services. Fifty-five percent of Gen X'ers (down from 68 percent last year and 69 percent two years ago) consider sharing economy services trustworthy. Fewer baby boomers also trust the sharing economy but the margin is much lower down just two percentage points from 46 percent last year to 44 percent this year.
"When we created this index five years ago, we knew that trust would be crucial to the health of the sharing economy. The simultaneous drops in trust and usage highlight the main challenge that players providing sharing economy services will need to address," said Daniel Durazo, Director of Marketing & Communications at Allianz Global Assistance. "As travelers seek more consistent, reliable travel experiences with high-quality customer service, travel insurance delivers by providing peace of mind and 24/7 global assistance when unexpected events derail their travel plans."
Another reason younger generations may be turning more toward traditional hospitality services is that these industries have diversified over the last few years as the sharing economy took off to attract more millennials and Gen-X travelers.
For example, Marriott recently announced a six-month trial with Hostmaker, a London-based homestay property management company. Brands such as Hilton, Hyatt and Wyndham are considering similar investments.
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