How the sharing economy is disrupting business

@IE University

The sharing economy has been sparked by and has led to drastic changes in consumer behavior. In the early days of sharing, it was a hot topic of conversation; now, some of the biggest and most successful companies thrive using the dynamic sharing model.

Companies like Airbnb and Uber have transformed the way businesses interact with customers. With digital technologies and mobile devices making it easier than ever to access shared services, the sharing economy has become a part of everyday society.

But what are we really willing to share? Can the sharing economy take hold in every sector and even outrun conventional capitalism?

What is the sharing economy?

The sharing economy is built on the concept of sharing resources. It relies on peer-to-peer networks and online platforms that connect people. A more developed digital network and platforms that garner users’ trust have allowed the sharing economy expand from impersonal services (like offering second-hand knick-knacks on eBay) to more personal services (like sharing a spare bedroom, giving medical advice, or providing a car ride home).

The success of the model can be attributed to its minimalism and a reliance on people’s eagerness to save money. Sharing has become increasingly popular, giving people the opportunity to make the most of things they no longer need or use. Now, crowdsourcing companies make it faster and easier for customers to get what they need and for hosts and service providers to make a little cash along the way.

How the sharing economy is disrupting business?

We’ve all heard of—and most likely used—companies like Airbnb and Uber. Joining the market in 2008 and 2009 respectively, they are two of the biggest companies at the forefront of the sharing economy.

Uber’s main advantage is convenience. Rather than offering cheaper services, they rely on the customer’s need for reliability and convenience. The user-friendly app includes past journeys, payments, and reviews, making it simple for people to use, with the information they need found all in one place.

Airbnb has transformed the hotel industry with future-forward thinking that’s in tune with consumer needs and trends. Airbnb’s peer-to-peer network allows people to interact with one another using an online platform to share accommodation, at (mostly) affordable prices. Their model encourages interaction—and afterwards, reviews—between sharers and consumers, increasing trust on both ends of the interaction.

Other companies like Rover, helping connect pet owners with occasional pet-care services, and CrowdMed, offering healthcare advice and diagnoses, have become successful by connecting people via crowd-based platforms. They both offer cheaper alternatives for service seekers and give service providers the chance to make some extra money without a full-time commitment.

How can the sharing economy help small businesses and entrepreneurs?

With the sharing model, otherwise unused assets become sources of revenue. Companies that work within the collaborative economy and the people who engage with them increase earnings by understanding how to better use these resources.

Innovative entrepreneurs have the opportunity to drive the process of creating economic resources. Enthusiasm for the sharing economy has created the perfect landscape for entrepreneurs to launch new ideas and become successful without a lot of overhead. It is changing the way we look at business creation, and stimulating economic growth in a more sustainable way.

As the sharing economy continues to grow, there is a need for a new type of entrepreneur who is ready to take the wheel and lead the transformation. In a world where better ideas beat more money, entrepreneurs of all shapes and sizes have the power to grow and thrive.

The future of the sharing economy

The digital era and increased connectivity mean the sharing economy is probably here to stay. The success of companies like Uber, Kickstarter, Airbnb, TaskRabbit, and many others have shown that it is a viable model for growth, and technological advancements are paving the way for new ventures. It is now easier than ever for sharing economy platforms to connect people, foster sharing, and grow using smartphones, apps, and advanced online platforms.

The future of the sharing economy

There is also a growing consensus that the sharing economy is a more sustainable alternative to traditional corporate capitalism. From crowd-based companies that solve global issues such as the distribution of clean water or energy, to the sharing of resources like cars, which promotes efficiency, sustainability, and community, this model is appealing to those interested in a greener future.

As competition grows, there is a need for companies to ensure their services stand out from the rest. New value propositions have to stay at the cutting-edge, using the latest technology to create compelling user experiences and innovatively offer the goods and services people are looking for.

The sharing economy provides an exciting opportunity for change and growth. The entrepreneurs of the future who are ready to push the envelope and take advantage of the new technologies shaping the way we share, will decide where it will take us.