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CHAPTER 1 INTRODUCTION

1.1 Background and Motivation

An uneasy economy has made millennials cautious to spend money and accumulate more debt, but it has also brought forth new spending and consumption behaviors. A new mindset about consumerism has been established. According to Heller (2017) of The New Yorker Magazine, sharing and being frugal are now perceived as cool and clever as ownership is not a necessity anymore; for this generation, ownership can instead be an obstacle in terms of care and maintenance. This is why the sharing of goods and services made possible by the information technology has become essential (Arthursson, 2016). Gone are the days of "self-serving ownership"; community sharing, and "mass-enjoyment" are the 'now' trends.

While sharing is an act known to the society since far in the past, collaborative consumption and the sharing economy is a relatively new phenomenon that has been growing rapidly over the past decade (Frenken & Schor, 2017). Nevertheless, collaborative consumption is not as foreign of a concept as one might think. Especially in the U.S. where many collaborative consumption platforms such as Uber and Airbnb were founded, collaborative consumption has been referred to as part of the millennials’ economic future (Heller, 2017; Yaraghi & Ravi, 2017). In addition, it has also started to be a preferable choice adopt collaborative consumption in Europe and Asia too, specifically in accommodation and transportation sectors, as opposed to choosing taxis and traditional hotels (Wosskow, 2014;

Lee, 2016).

Sharing economy/collaborative consumption could offer a number of positive benefits towards a country’s economy. For Instance, before the emergence of sharing economy, only

hotel owners and big taxi companies could benefit from transportation and accommodation sectors in the past. However, along with the birth of collaborative consumption platforms like Uber and Airbnb, more entrepreneurship opportunities are available for local citizens to earn a living, by sharing their ownership of a property with others for a certain price.

Over the past few years, as society becomes increasingly exposed to technologies, collaborative consumption platforms emerge one after another transforming many sectors and industries. Founded in 2008 is one of the most prominent platforms to arise from the sharing economy, Airbnb; a collaborative consumption platform that allows people seeking for temporary accommodations to connect with others willing to rent out spaces in their homes (Interian, 2016). In a densely populated country like Indonesia, for instance, finding a land to build new properties is becoming harder and harder, and more than a few developers started to seek out forests and greeneries as a place for new hotels and resorts (Balch, 2015). Having more members of the society familiar with Airbnb could free up lands to be utilized for more environmentally-sustainable purposes, for instance, creating a green city.

According to Hamari, Sjöklint and Ukkonen (2015), growing concerns about environmental sustainability have made collaborative consumption an appealing alternative for consumers; it is considered to save natural resources and free up lands to allow reforesting.

Furthermore, an exploratory study by Tussyadiyah, 2015 suggests that collaborative consumption provides an opportunity for local communities to achieve economic benefits by utilizing unused resources in their possessions (e.g. cars and empty rooms). Therefore, it is important to explore the antecedents of consumer’s behavior intentions on sharing economy adoption, especially toward home-sharing services such as Airbnb. Not only it could provide financial opportunities for local community, but also save up free lands in a densely populated country for other purposes like promoting environmental sustainability.

In recent decades, people understand more and more about human behavior and the intentions that drive behaviors toward certain actions. In order to evaluate the behavioral intentions behind adoption of collaborative consumption, the Theory of Planned Behavior (TPB) will be utilize in the following study. While the Theory of Reasoned Action (TRA) solely focuses on volitional personal/social factors when explaining individual’s intention formation (Ajzen & Fishbein, 1980; Park, 2003), TPB, a more comprehensive version of the TRA, suggests that an individual’s intention to perform a certain behavior is determined by attitudes toward the behavior, subjective norms about engaging in the behavior, and perceptions on whether he/she will be able to successfully engage in the behavior (perceived control) (Ajzen, 1985, 1991, 2002). In particular, it could contribute to improving our prediction of an individual’s adoption intention to collaborative consumption.

The importance of TPB as a behavior predictor is apparent in studies investigating a wide range of behaviors, such as visit intentions to stay at a green hotel (Han, Hsu & Sheu, 2010), negative word-of-mouth (Cheng, Lam & Hsu, 2006), behavior intentions toward internet purchasing (George, 2004), experiencing local cuisine while travelling (Ryu & Jang, 2006), adolescent regular physical activity (Hamilton & White, 2008). This suggests that attitudes, subjective norm, and perceived control could also determine an individual’s behavior intentions toward collaborative consumption. With the increasingly popular collaborative consumption platforms like Airbnb, this study attempts to use TPB as its basis to explore the motivational factors that drives behavior intentions toward Airbnb. In other words, this study intents to investigate attitude, subjective norm, and perceived control as potential determinants of an individual’s behavior intention towards collaborative consumption.

The rise of collaborative consumption and its global recognition is driven and enabled by a number of factors. Among them, enjoyment and safety are two of the factors that have been continuously mentioned in a number of studies as drivers of collaborative consumption and other sharing-related activities. Studies suggest that enjoyment plays an essential role in the behavior intention towards collaborative consumption (Hamari et al., 2015; Guttentag, 2016). A survey of U.S. customers (Kokalitcheva, 2016; Verhage, 2016) indicates that many who had used Airbnb service would stick with it because they found their stay exciting and enjoyable. As proposed by Guttentag (2016), this enjoyment derives from the unique and authentic experience that one could gain from such sharing-economy practices like Airbnb.

As someone who have stayed in Airbnb accommodation several times in the past, I concur that it offers a unique staying experience compared to traditional hotels. Therefore, this study intents to investigate enjoyment as a potential determinant of an individual’s behavior intention towards collaborative consumption.

Nevertheless, adoption of collaborative consumption might also be exposed to a risk of safety. In April 2012, a Couchsurfing (a site that predates Airbnb) host was sentenced to six years in prison after he drugged and raped a 16-year-old Australian girl who was staying in his apartment with her sister and mother (Brown, 2015). Recent media attention has shown that guests of the Airbnb rentals have (1) been targets of crime, (2) had valuables stolen, and (3) may be more exposed to a greater range of crimes due to not being in a tourist location (Xu, Kim & Pennington-Gray, 2017). This suggests that while enjoyment could positively fuel the adoption of collaborative consumption, safety issue could be a big negative factor preventing people from adopting collaborative consumption. Therefore, this study intents to investigate safety as a potential determinant of an individual’s behavior intention towards collaborative consumption.

The impact of sharing economy has been enormous, affecting most dramatically, industries like accommodation, transportation, e-commerce, and tourism among others (Belk, 2014; Tussyadiyah, 2015; Lee, 2016). Despite a growing practical importance, there is a lack of studies exploring motivational factors that affect an individual’s attitudes and intentions towards collaborative consumption. By understanding the behavioral intentions behind the adoption of collaborative consumption, marketers and sharing-economy startups could better target their potential users; for instance, by promoting their effort on sustainability and/or addressing risks of safety so potential users would feel safe and protected. With more people adopting collaborative consumption, not only it will have positive effects on environmental sustainability, but hopefully also bring economic empowerment for local communities.

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