As consumers can whip out their phones to get instant, on-demand access to products and services they want, we’re seeing a shift in thinking from ownership to access. It’s almost expected at this point. If your business can’t offer something to compete with this nearly frictionless effort, you’re vulnerable. When highlighted against the four disruptive forces (mobile, mindset, Internet related, emerging technologies), the collaborative economy hits all all four.
And while there is growing concern around sharing startups’ lack of regulation and aggressive global expansion, it hasn’t slowed the growth of the collaborative economy (especially behemoths like Uber and Airbnb), making it critical for established brands to understand consumer sentiment, learn their preferences and capitalize on these shifts now more than ever.
A three-pronged opportunity has emerged for large companies — but it isn’t necessary to pursue all three simultaneously; there may only be one strategy that suits each company. They can choose to compete on price, convenience or brand.
Price is fairly obvious, as financial savings is one of the top drivers of the collaborative economy with 82% of sharing transactions partially motivated by price. Established brands are well-positioned to offer greater value to providers in the collaborative economy, as traditional purchasers would use collaborative economy services for a 25% savings.
Convenience is another strong driver. To be able to pick up a device and get a service (or at least secure a service and view the length of waiting time and status of the request) appeals to the human need for immediate gratification. Convenience poses a major challenge to established companies, because it’s exactly where sharing startups have a structural advantage. However, convenience is a factor that established organizations can compete on, with value-added services that create efficiencies, on-demand access to products and services, mobile apps, and even the sale of locally-sourced and crafted products.
Having a trusted and well-known brand – even when competing with well-liked startups – is an advantage. There’s a close relationship between brand recognition and market dominance. Most people have heard of big collaborative economy players like eBay, Craigslist, Etsy, Uber and Kickstarter, and many of the top-sharing players have positive reputations. Yet more than 25% of would-be sharers will consider traditional buying if it means doing business with a reputable brand. The role of brand in the collaborative economy presents an opportunity for large companies to take advantage by marketing on trust or partnering with sharing services to leverage their brand.
Scott Monty @scottmonty
Scott Monty is the CEO and co-managing partner of Brain+Trust Partners, a strategy consultancy firm specializing in digital transformation, technology selection and executive advising. He speaks to groups about the fundamentals of the human condition that are relevant to business today.
Scott spent six years at Ford Motor Company, as a strategic advisor on crisis communications, influencer relations, digital customer service, innovative product launches and more. He also has a decade of experience in communications and marketing agencies, where he had clients that included IBM Healthcare and Life Sciences, Coca-Cola, American Airlines, T-Mobile, GE Software and more.
He is a board member of the American Marketing Association and an advisor for RPM Ventures, My Dealer Service, Crowd Companies and Clever Girls Collective. He writes about the changing landscape of business, technology, communications, marketing and leadership at ScottMonty.com, where he distributes the widely acclaimed Week in Digital newsletter, and is the executive editor and co-host of the Sherlock Holmes website and podcast I Hear of Sherlock Everywhere.