What is the Sharing Economy?
The term “sharing economy” originally came from computer coders who shared programmes for free, but it has now become so broad that the real definition is often not known. “Sharing economy,” “peer economy,” “collaborative economy,” “on-demand economy” and “collaborative consumption” are all used to describe different tech or app start-ups, but they all mean different things.
The sharing economy is defined by Investopedia as: “An economic model in which individuals are able to borrow or rent assets owned by someone else.” The use of digital technology is often used in a sharing economy to match a service with customers, cutting out the need for a middleman. The Internet has made it easier for both lenders and searchers to find each other. These interactions are also known as P2P (Peer to Peer).
In her article What is Collaborative Consumption and What Isn’t, Thought Leader Rachel Botsman also explains that the definition of the sharing economy is intrinsically linked to the Values of a start-up, stressing that they should be collaborative to truly be part of the sharing economy “family”. So it’s important for a sharing economy business to have a clear and visible Values-driven mission statement.
So, how to succeed with a sharing economy business in the year ahead?
Here are some pointers from us:
- Keep doing what you said you would. In the world of instant gratification the public can make or break a new or even an established start-up practically overnight. You’re good as long as you’re delivering on what you promised.
- Only the most agile will survive. If your services are no longer in demand you need to have the flexibility to change direction quickly.
- More sharing and pairing: Big businesses who haven’t found Corporate Social Investment or eco-friendly partners will be looking to pair-up with community influencers and smart start-ups that are authentic and making a difference.
The need to be responsive rather than reactive is critical, with social media fanning the flame of any problem. Brands have to be quick and careful when responding to criticism. - Sharing economy start-ups with apps or products for sustainable living are on the rise. Everything from water tanks, solar heating and even pre-fabricated homes are going to be in demand. South Africans are quickly seeing the value of living more and more off the grid. Those who make this quickest and easiest to do will be the most successful.
Accessible and (becoming) cheaper technology and internet access means that the sharing economy is set to boom in 2016. Also, it’s never been a better time to jump into the growing pool of entrepreneurs that are driving the sharing economy – using outsourced, shared resources and in many cases outsourcing themselves too.
For more Sharing Economy inspiration or business advice please contact: Nokwazi@rocketpad.co.za.
