Tactics of institutional work in the home-sharing ecosystem: An analysis of Airbnb’s entrepreneurial quest for legitimacy and incumbents’ need for response

Since its market entry about 15 years ago, the sharing economy has increasingly pushed traditional business models and local policymakers to reshape the institutional environment. Taking the role of institutional entrepreneur, sharing economy companies have developed a realm of institutional tactics to gain legitimacy, in their quest for competitive advantage and economic rent. So far, research has highlighted institutional tactics from the perspective of the sharing economy company (e.g., Pelzer et al., 2019; Zvolska et al., 2019). Only a few studies, have adopted a multi-actor perspective (e.g., Boon et al., 2019; Lehmann et al., 2022), by also focusing on other actors. However, the position of incumbents has remained underexposed and deserves more attention. Including incumbents in a multi-actor perspective would help to uncover the dynamics of disruptors’ and incumbents’ efforts in shaping institutions. Against the theoretical backdrop of institutional work, we address those needs, by examining the institutional tactics of Airbnb and the hotel industry in Brussels Capital Region.
Through a content analysis of Belgian press articles, the study aims to identify institutional tactics and government regulations characterizing the Belgian home-sharing economy from January 2008 to June 2021.
Findings show that, to attain legitimacy, Airbnb initially followed a smooth approach, based on tactics of ‘creating institutions’. As the local Brussels government started to implement stricter laws and harmonize tourist taxes, Airbnb began to use more aggressive tactics, such as petitions and complaints at European policy level. This led to a more lenient law, in favour of Airbnb, as the Brussels government was called back by the EU. The rising popularity of Airbnb led to more complaints by the hotel industry. The dynamics between Airbnb, striving for legitimacy and recognition of its business model, and hotels, seeking to get Airbnb comply with rules on fair competition, have been mainly characterized by negotiations and smooth adaptations to the institutional environment.
This study questions Airbnb’s status as disruptive innovator as the company hardly used tactics with the aim of disrupting institutions. Hotels mostly worked towards keeping the institutional status quo. However, exceptionally, hotels adopted tactics of creating, in response to new entrants. The latter highlights the need for further research on the use of tactics of ‘creating institutions’ by incumbents in the sharing economy.