Sharing Economy

The sharing economy is a globally evolving concept where resources and assets of one party are temporarily shared by multiple users and forms a business out of it. In other words, basically one entity owns assets and shares among a group of its customers with the help of the network and mobile applications in the service execution process. Technology and innovation are both the fundamental pillars of the sharing economy. Technology assists in the execution of the brilliant sharing concept and provide the highest efficiency. With technology the most important part of this concept, it has eventually shaped the businesses by making them highly efficient. This being a great example of an applicative innovation, it has been adopted by an increasing number of businesses and organizations. In only a few years, this approach has grown into an unbelievable force of economy which accounts for billions.

Access over ownership is the new unorthodox trend among consumer markets. It is quite a cost-effective approach where even the business houses don’t need any ownerships of unnecessary assets. Basically, firms develop a huge pool of partners who assist them in fulfilling customer needs. Those partners are the ones who have invested their money in assets that aren’t in regular use for themselves. Such assets can now be put into better use. Economic and efficient in terms of costs because users don’t need to purchase assets that aren’t necessary for them in the long run or that costs them too much. Usually more popular among younger generation customers because the snow-ball effect is easier to be made among such customer segments where the internet binds them to the form of a community of all the users. Usually, through such networking, the customer base increases in such a business. Also, this concept helps bring good for the environment with reduced wastage and pollution, in both production and consumption point of view.

Numerous businesses that use sharing concepts have been successful as they promise simplified, transparent, modern, and sophisticated user experience. The right mix of ingredients that has attributes to attract both businesses and consumers with the same motive of cost-saving and better consumption experience. It is a fast-growing segment in the global economy – sharing models of business are evident to be thriving in every sector. Its scope and efficacy have been broadening in recent times – from the entertainment industry to tourism, hospitality, education, transportation, health care, and many more. One of the most significant complementary developments in the consumer market has been the extensive use of mobile phones and applications. Mobile applications have assisted largely in the ubiquitous growth of the sharing economy. People want easy, quick, innovative, and reliable services. The more the innovative approach for service delivery, the more the customer base can be expected.

One of the prime examples is businesses like Uber, which ensures not just taxi (transportation) services but also a great service consumption experience. Let’s break it down. The number of steps one had to go through before getting a taxi service in the traditional approach was way too high. Traditionally, one had to go to the street/taxi stand, look around and wait for a taxi, ask if the driver is interested, negotiate the price (in many cases), unknown the time and costs of the travel, and more of such uncertainties. This now isn’t acceptable for customers because of the arrival of service providers like Uber and Lyft. These steps of finding a taxi service have drastically been decreased and innovatively designed in such a way that they provides the best services for the customers. Customers benefit at multiple levels including booking and finding a taxi with ultimate convenience, user-specific customization of services, easy and quick payment, feedback, and knowing exactly how long to wait. Taxi partners benefit from this as well, because their asset is generating more revenue now; no more idle sitting for customers to pass by. More opportunities for income with less cost of time and effort.

Undoubtedly, as discussed, there is a huge implication in the core transportation industry where supply chain and logistics are now revolutionized. Because of the asset-sharing models, the volume of collaborative consumption has been growing up in a rocketing pace in all sectors, especially in the transportation industry. This sector was probably one of the least innovative sectors in world history. Although sharing is quite similar to the renting concept, some ingredients of technology have made the ultimate difference. Thus, with the sharing economy concept, things have changed in a way that we wouldn’t have imagined a few years back. Other examples in different sectors are companies like WeWork, Airbnb, eBay, Freelancer, Netflix, and more. Businesses have a unique approach to providing services, which led them to succeed. Also, within this domain of the asset-sharing approach of business, the increasing number of startups in emerging economies is quite interesting. Such a spirit of entrepreneurship has accounted significantly for the economic growth of those countries.

Why Sharing Economy? Top 5 conclusive reflections:

1.    Applicative innovation and technology have made this concept such beneficial for both the partners (asset owners) and consumers as well.

§ Reduced wastage (idle time), affordable services, higher convenience, and consumer benefits.

2.    The investment need for heavy capital assets is no longer a decisive barrier for entrepreneurs and startups that can now focus on building a better user experience.

3.    With reviews and feedbacks, the much-accorded issue of trust and transparency is solved, leading to loyalty and increased consumption.

4.    Use of personal devices like mobile phones are only in an increasing trend, which reflects on a growing application of sharing economy concept.

5.    A huge wave of innovation awaits, which might lead to changes in business and consumer behavior.

Keywords for reflection: applicative innovation, technology, asset-sharing, mobile phones, network, applications, environment friendly, economic growth, better user experience, and business efficiency.