By 2025, the five main sectors of the "sharing economy" -- peer-to-peer finance, accommodation and car sharing; online staffing; and streaming media -- are projected to be worth a total of $335 billion. At present, these sectors are worth just $15 billion. Learn what's projected to change in the next nine years and how major brands can stake their claim in peer-to-peer markets.
How the Sharing Economy is Shifting Ecommerce
The traditional model of ecommerce is shifting away from the one-to-many model where capital flowed from consumers to the store. Sharing marketplaces turn the one-to many into a many-to-many model where buyers and sellers shift roles fluidly. Sitting in the middle is a marketplace owner monitoring admission and transactions.
Platforms like eBay and Craigslist were an early model of peer-to-peer ecommerce marketplace. Next-generation startups innovated the ecommerce peer-to-peer experience, leveraging the smartphone for on-demand service.
While they have been absent from the peer-to-peer sharing economy thus far, major brands do have an opportunity to compete in this space. Brands might move toward this model immediately through a branded marketplace where fans of a brand might come together to collaborate on projects, share content, and engage in a close fan relationship with that brand.
Alternately, brands might create a sort of "white label Facebook group" owned by the brand instead of Facebook. In this marketplace, fans of the brand can come together, connect, share thought leadership, and provide mentorship inspired by, and connected to, their favorite brand.
We've started to see this shift toward a collaborative economy model already. Intel has waded into this space with the Developer Projects Marketplace, which has some of their 20 million registered developers listing their work, following one another, and collaborating on projects.
Speaking of the Intel marketplace, Adam Broadway, CEO and founder of Near-me.com said,
"There is a huge opportunity for traditional businesses and business models to morph into a marketplace model. We're seeing it with large clients we have, like Intel. Those that innovate in this direction will reap the rewards in the next 5 years. Those that don't, like Blockbuster who ignored the Netflix business model, may go the same way as Blockbuster."
While fear of being left behind is a big driver of innovation, brands who build their own sharing marketplace will realize many advantages. Brands can ensure consistency and quality within Business-to-Business-to-Customer ( B2B2C ) contexts, manage the user experience throughout the entire product or service life cycle, build trust and relationships with partners, and identify the currently hidden circle of influences that exists within peer groups.
As these types of branded community marketplaces gain traction, they may even shift to be transactional marketplaces filled with brand, service and niche experts. Smart marketplaces might offer referral commissions and inventory access via API, turning the virtual marketplace into a peer-to-peer commodities and services exchange, for example.
Competition in the Sharing Economy
As new startups and major brands begin competing in the sharing economy with those longstanding players like eBay, the marketplace economy will face steeper competition. Companies will need to succeed, not only with service, but with value added.
"We've seen too many startup marketplaces rely on 'mechanical turks' to get supply and demand built up, and then hope that they provide a better or cheaper service. This 'race to the bottom' approach is lose-lose for the Marketplace owner and the clients," Adam noted. Companies can showcase difference through value-added features like a better user experience, better customer support, access to premium products or suppliers, improved invoicing, or detailed customer and supplier trust ratings.
Another way to add difference and demonstrate value? Add support for older technology. As Adam says, "Africa has a HUGE market, where SMS is the best means of confirming sales and bookings, but most Marketplaces are tuning for the more sophisticated devices that may not work globally."
In addition to the challenge of competition, all sharing economy companies must overcome barriers. Chief among them is finding a way to maintain their uniqueness and authenticity while changing their service model. Companies must also resolve regulatory and fiscal issues, and insert safeguards to keep the transactions within the marketplace. Potential ways to keep
business in the marketplace include incentives like client safety, efficient organization or penalties for those who move offline.
The sharing economy still has some growing pains to work out, and major challenges to address. But savvy brands who want to stay on top of the digital experience will want to move toward a marketplace. After all, $335 billion will soon be on the table.