Home-Sharing Service Transactions in China Set to Top $1.8 Billion This Year
Spike in demand reflects growing consumer interest and gives rise to multiple services
Interest in Airbnb-style accommodation-sharing appears to be increasing in parallel with growth in the digital travel market in Asia-Pacific. Digital travel sales in Asia-Pacific are expected to surpass those in North America this year, according to eMarketer projections. China, in particular, is experiencing a rapid rise in such accommodation-sharing, according to research that suggests spending and interest in the sector are growing.
According to a February 2017 report by iResearch Consulting Group, spending on home-sharing services in China is expanding at a rapid clip. The company estimates that home-sharing transactions in China will total RMB12.52 billion ($1.88 billion) this year. This spending will occur on popular accommodation-sharing platforms operating in China, among them Airbnb, Mayi, Xiaozhu and Tujia.
This increase in transaction volume appears to be a direct reflection of increased interest in property-sharing services among consumers in China. A July 2016 survey by iiMedia Research found that space- and property-sharing services were the second most popular category of sharing economy services among internet users in China, behind only ride-sharing.
Why has the sharing economy seen such rapid growth in China, a market where other Western companies and business concepts often face strong headwinds? Some recent research suggests consumers in China view sharing economy companies as a mechanism to promote the common good of society, something they accomplish by promoting the proper allocation of resources.
Still, not everything is working for China’s accommodation-sharing industry. In November 2016, Airbnb announced it would be splitting its operations in China from the rest of its international operations, a decision made to adhere to local business regulations. The popular accommodation-sharing company’s recent challenges, combined with the rising success of homegrown competitors, suggest further market consolidation could be coming in the near future.