The serviced apartments and travel industry can be a challenging one and this article touches the main issues that smaller companies within the industry face. The article brilliantly explains how the so-called “me-too” companies don’t manage to differentiate their brand from AirBnB and how they lack a distinctive positioning. Although this might be the case for some smaller competitors, there seem to be some key points that the article doesn’t take into account. As with Avis proclaiming “We’re just number two, that is why we try harder” compared to the market leader Hertz (within the car rental industry, red.), we – the smaller companies – should be doing the same.
So why should people choose the smaller companies over the market leaders AirBnB, Hotels.com, Booking.com?
First of all, quality checks! As someone working within a smaller company in the industry, I know that we do personal visits in the apartments listed on our website. Why? Because we want to make sure that what we offer is something that lives up to our own expectations and thereby, hopefully, our customers’. So offering fewer properties than e.g. AirBnB isn’t necessarily a negative aspect as the properties listed are more likely to be of higher standards, which brings me to my second point. Specific user demographics. This is probably the main concern for many “me-too” companies, as they don’t have a clear idea of whom they want to target – or how. Large companies within the travel industry offer everything from 1 star hostels to 5 star luxury aparthotels, which is beneficial for the end user if they have absolutely no idea what they want. But honestly, how often does that happen? When you book a holiday or business trip, don’t you already know if this is going to be a long term stay where you want to be able to make yourself feel at home, or a big city getaway where you won’t spend any of your awake hours in your chosen accommodation type? A small business that positions itself well in a niche market will know their specific market and therefore its target audience’s wants and needs. Hence a better customer experience.
Industry leaders often dominate in basically every single city worldwide whereas smaller companies might benefit from focusing on dominance in certain cities or areas. Yet another reason why lots of companies don’t manage to differentiate and position themselves – they forget to specialise within a niche market. This can be anything from differentiating between B2B and B2C, luxury and budget, or big cities and countrysides, charter locations etc. If a smaller company aims to be dominant in certain cities this can again improve the customer experience.
Flexibility – or lack thereof – can be a big concern if not managed correctly. Especially business travellers tend to experience last minute changes that can change their needs. It is arguable whether smaller or bigger businesses are more flexible but procedures are often more set and established in bigger companies, simply because they can afford it. So, let’s make the competition more interesting and push our niches forward instead of hiding under the big guy’s shadow.
No, it isn’t always easy being a small business when a market leader seems to dominate an industry. However with the right positioning within a niche market, it is possible for smaller businesses to satisfy more specific needs – after all; being smaller, we try harder.