The sharing economy has grown hugely over the last few years. Although the concept of sharing isn’t a new one (if you’ve ever borrowed a car or swapped clothes with a friend you’ll understand what I mean, obviously), the mainstreaming of sharing as a socio-economic ecosystem is only a few years old.
The sharing economy can take a variety of forms, but it’s built around the idea of people sharing their possessions, skills or other resources in a way that enables their wider distribution, use and reuse. This concept has spread across a huge number of industries: Airbnb and Uber are perhaps the most obvious examples, but other sectors have also been touched by the rise of the sharing economy – for example, logistics, utilities and even education.
But what does the future hold for this new phenomenon? A quick review of the two main reasons for its sudden and dramatic growth might point us in the right direction…
• The first reason lies in the rise of widespread access to affordable, mobile internet and smartphones – these make ‘sharing on the go’ easier, and – through the ‘always on’ nature of social networks – actually improve safety and trust levels
• The second reason is – of course – the recession, which acted as a potent catalyst for new services to emerge. Although you could make the argument this second motivator is on the way out with the recovery of the economy, with millions of people seeing the personal benefits the sharing economy makes on their lives, the damage – in a way – has already been done!
So let’s look ahead to the trends that will define the sharing economy in the year ahead as this new and exciting concept continues to grow and spread.
Trend 1: The sectors start to consolidate
For a company to succeed in the sharing economy it must first gain a critical mass of users – otherwise it simply won’t be able to offer a level of service that can rival the traditional model – no matter what cost-savings or community feel-good factor it promises.
At the moment, the market is still very crowded with multiple startups jostling for enough of a slice of the userbase to become competitive. However, with a handful of bigger sharing companies reaching that critical mass in their sector – and getting the valuations that indicate their mass appeal and potential – we might well be looking at a year of acquisitions and consolidations.
Having said that, diversity is still important and every new sharing brand is still ‘challenger’ in nature – no matter how big its price tag – so even ‘mature’ platforms are likely to be unpredictable in how they make their next move. If they stick to their values, perhaps we’ll see deliberate moves to increase competition in order to encourage growth across the sector – for example by launching APIs or sharing analytics.
Trend 2: The regulators try to regulate
There has already been a fair bit of news about sharing-economy companies getting into trouble for various things – from taxes, to insurance, to zoning and rental laws. These ‘infringements’ will continue to get attention in the news and will probably prompt a bigger, international debate about how and why sharing companies need regulation. On the other side of the argument, those who believe in the validity of the sharing economy will argue it’s the rules themselves – or even the whole game – that need to change. For examp.le, David Estrada of car-sharing company Lyft, puts this argument forward: ”“We need to change the mindset and show them that we can create the same level of trust and safety with no level of regulation from the government whatsoever”.
Trend 3: Big companies get involved
Finally, as the sharing economy becomes more mainstream, we’re likely to see more and more established traditional businesses wrestle with what to do about collaborative consumption. We may see a gap opening between those who address the potential competition head on by embracing collaborative consumption, and those who try to try to fight it off. Jeremiah Oywang, founder of Crowd Companies and global expert on the collaborative economy, believes that “large companies don’t need to fight this unstoppable trend, but instead can collaborate with this movement and make their products available on demand, motivate a marketplace around them, or provide a platform for customers to build on top of them.”
On the other side of the debate, the sharing companies have – as you might expect – their arms wide open. The CFO of +swappow puts it like this: “We don’t see retailers and manufacturers as competitors – we want to work with them. Buying new stuff isn’t going to go away. So this is really about growing the base by sharing the same ecosystem.”