The New Consumerism: The Reach of the Sharing Economy
The sharing economy is one of the eight trends which we see as combining to create The New Consumerism. The New Consumerism sees today’s consumers reassessing their priorities and increasingly ask themselves what they truly value : Why own something that I only use sporadically? Why accumulate more belongings when I could be out experiencing life? Why pay for space I don’t use?
The cross-industry appeal of the sharing economy
The sharing economy has the potential to impact across sectors. Those at the frontline include automotive and travel. Travel in particular is a sector revolutionised by the sharing economy. From booking accommodation in privately rented apartments and rooms on Airbnb, to engaging guided tours with a local on Vayable, to house swapping with Love Home Swap and meeting new people and dining in their homes through AirDine; the travel sector is awash with businesses embracing the sharing economy.
Yet the sharing economy has the potential to transform many more areas, disrupting sectors and creating new ones. Goods ideally suited to sharing include:
- Those that are only used sporadically – eg tools or sports equipment. Spinlister for instance enables peer-to-peer lending of bikes, surfboards and skis in over 55 countries;
- Those that are for a specific lifecycle phase – eg toys and games or baby equipment. US company, Toystrunk.com, stocks toys suitable for 0-6 year olds and allows users to create a wish list of toys and rent them for US$2-US$16 for 2 weeks;
- Those that are only needed for a one-off occasion – eg clothing for a special event or DVDs. Rent the Runway is a US-based company described by The New York Times as a “Netflix model for haute couture” Rent the Runway describes itself as not being in the fashion business, but being in the fashion-technology-engineering-supply-chain-operations-reverse logistics-dry cleaning-analytics business. For US$139 per month subscribers can access 3 items at a time and return them as frequently as they wish;
- Those that are highly expensive and out of reach of mainstream consumers – such as designer handbags or luxury cars. BMW and Sixt joined forces to create a high-end car sharing scheme. The scheme allows BMW to reach a younger demographic. RiseArt, describing itself as an art concierge service, enables subscribers to rent original art for a monthly fee.
Services are also affected. Underutilised space – in the form of gardens, spare rooms and storage space is a good fit. The sharing of skills online is a growth area as are time-saving offers which take on consumers’ chores and timebanks where people trade their time hour-for-hour.
- JustPark, a UK-based business, enables the rent of privately-owned parking spaces and driveways, marketing itself as a time and money-saving service for motorists;
- Rover – Based in the US city of Seattle, but operating nationwide, offers dog-walking, dog-sitting and daycare for dogs through a network of dog lovers. Rover takes 20% of its sitters’ earnings and also a service fee amounting to 5% of the booking fee of dog owners;
- Butler Factory is a Singapore-based company, which connects businesses with freelancers globally;
- Roost enables its users to rent out storage space in attics and basements and parking spaces across major US cities.
Online portals enable the renting or free exchanging of almost any product or service:
- Rent Tycoons is a Singapore-based peer-to-peer rental platform enabling users to rent almost any good or service.
- Similarly, HeyNeighbor! is a community marketplace in the USA for people to find tools, equipment, and other household items;
- Peerby, based in the Netherlands, is a similar platform but facilitates the borrowing of goods free of charge.
Embracing the sharing economy
It may be naïve to think the sharing economy will disrupt and transform all sectors, but it will have an impact to a lesser or greater degree on all consumer-facing companies. Being at the forefront of the trend, the travel and automotive sectors provide a glimpse of how the sharing economy will develop. Established businesses are, and will increasingly, embrace the sharing economy – in travel Hyatt has bought a stake in Onefinestay whilst Wyndham Hotels has purchased a stake in LoveHomeSwap. In automotive, Zipcar was purchased by Avis.
It’s vital that business does not bury its head in the sand where the sharing economy is concerned; there are many opportunities to be had for established players – from reaching new consumers, building brand loyalty and improving reputation.