You’ve already participated in the sharing economics if you have ever used an app or a website to book a place to stay on vacation, or to hail a taxi. The sharing and gig economies are the result of technological advances that have changed how business is done in many industries. The sharing economy was the most significant change in the world because it allowed millions of people to create an alternative source of income.
The Key Takeaways
- Technology helps to connect the providers and consumers of goods or services.
- Shared economy can reduce business costs and increase efficiency
- Share economy helps consumers make environmentally friendly choices
- The sharing economy can help workers earn an additional income by generating a side hustle
What is the sharing economy?
It would be unfair to try and define the sharing economy. The sharing economy is a constantly evolving economic principle. It’s the technology that facilitates the exchange of goods and services between two or three parties. 1
This concept is based on the idea that two parties can benefit from an underutilized asset or skill. The value exchange is done through a peer-to-peer app, a collaborative platform or a shared marketplace.
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Bartering was a common practice in rural communities that used the sharing model. Managing share-based transactions is now easier than ever thanks to mobile and internet technology.
This term, which is most commonly used to describe the sharing economy umbrellas many other economic systems including:
- Collaborative Economy/Collaborative Consumption
- Peer-to-Peer Economy
- Freelancing/ The Gig Economy
- Crowdfunding/Crowdsourcing
- Coworking/Cobranding
What is the impact of the sharing economy?
Sharing economy disrupts traditional business sectors. The sharing economy has exposed the excess capacity problem in many industries. It could be equipment that is unused, or a worker with a limited number of hours. Or it could even be an excess supply.
Sharing economy can help businesses reduce costs by sharing and using existing resources efficiently. Sharing economy helps businesses reduce costs by sharing resources and utilizing them efficiently. 3
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Share-based businesses can run more efficiently due to the lack of inventory and overhead. These brands can pass on the value they have gained to their customers and partners in the supply chain because of increased efficiency.
The sharing economy is affecting traditional industries. Many brands that have been around for a long time will struggle to adapt to this new landscape.
Transport
Uber’s rise in the transportation sector is one of best examples of how the sharing economy can be applied to a traditional industry. Uber and ride-sharing services are a convenient and affordable alternative to public transportation or taxis.
Uber’s mobile app and its network of drivers are designed to meet the transportation needs of consumers while offering a better experience than other traditional methods.
The Top Brands of Shared Economy in the Transportation Space Include:
- Lyft
Consumer Goods
PWC’s research shows that 86 per cent of U.S. adults who are familiar with the sharing economic say it makes life easier and more affordable. 83 per cent also agree that sharing economy is more efficient and convenient than traditional methods.
Three of the biggest influences on consumer goods purchases are affordability, convenience and efficiency. It’s therefore no surprise that consumer goods are dominated by brands with a share structure.
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Sharing economy is a way to make consumption more environmentally friendly by sharing resources. 2
eBay was one of the first peer-to-peer online marketplaces. Users can buy or sell new and used items using their innovative platform, with the products being shipped directly to them. The platform allows consumers to browse products with a range of prices, conditions and guarantees. The consumers are empowered and can purchase products in a convenient and affordable manner.
The following are the top sharing economy brands for Consumer Goods:
- eBay
- Etsy
- Rent the Runway
Professional and Personal Services
Professional and personal services are the best example of how the sharing economy can benefit. Work that requires special skills, knowledge, experience, certifications or training, such as copywriters or accountants, is considered professional and personal service. This is also known as freelance, gigs and other trendy terms that are equivalent to short-term work in the sharing economy.
Fiverr and Upwork are powerful platforms that provide a friendly and secure environment for people and businesses to find contractors.
Note:
You can make extra money by sharing your trade expertise and skills, just like you would if you rented out your home or shared a ride with someone.
The following are the top sharing economy brands for Professional and Personal Services:
- Fiverr
- Upwork
Healthcare
Many experts believe that the healthcare industry will be the next frontier of collaborative consumption, even though the sharing economy is still a relatively new concept.
We’ve seen share-based solutions mitigate the limitations of traditional healthcare, including expenses and resources. The sharing economy will change the healthcare industry. From group-consultations to telemedicine, it’s destined to do so.
As an example, expensive medical equipment that is not used can create storage and maintenance costs. Share-based startups, like Cohealo, help hospitals save money by creating technology that allows them to share their medical equipment with other facilities.
The top sharing economy brands for Healthcare include:
- Amwell
- Doctor on Demand
- Cohealo
What is next for the sharing economy?
The sharing economy has advanced to the point it is at today, and this trend will only continue with the increase in digital connectivity. We’ve seen the impact of collaborative consumption in industries such as transportation, consumer products, and services. But, we will see changes soon to many other traditional sectors.
FAQs (Frequently Asked Questions)
Why is sharing economy so important?
The sharing economy is the use of technology to connect buyers and sellers. This is important, as it allows businesses to improve their efficiency and reduce costs. The sharing economy is also a great way to earn extra income. For consumers, the sharing economy allows them to get a product or service they want on demand, at a fair price and in a green way.
How can companies cut costs in the sharing economy?
The sharing economy has exposed the excess capacity problem in many industries. It could be equipment that is sitting idle, a worker with a limited number of hours or an excess of a certain product. A sharing economy can help reduce the opportunity costs of not using resources effectively. Sharing economy helps businesses reduce costs by sharing resources and using them efficiently.
