The “sharing economy” is a term that has gained a great deal of recognition over the past few years, referring to the recent shift in the way the world is doing business. Today, more than ever, consumers are turning to a collaborative model. And while this concept isn’t entirely new (after all, sharing is an integral part of human nature), recent growth and success of shared business solutions have demonstrated that this new economy is the way of the future—uncovering an entirely unexplored aspect of the global economy.
While only time can tell where the sharing economy will take us in the next few years, we have already begun to see a few noteworthy emerging trends that are anticipated to ring true throughout 2018 and beyond.
Millennials Are The Driving Force.
One key fact about the sharing economy worth noting is that millennials are (and will likely continue to be) the driving force behind it. This is especially true when you consider a couple of the most prominent examples of sharing-economy success, Airbnb and Uber. Millennials are now traveling more frequently (and spending more money while traveling) than any other generation; and as they travel, they’re seeking personalized and authentic experiences. Services like Airbnb and Uber allow them to enjoy the cities to which they travel in a more authentic way than staying in a “traditional” hotel room or relying on a taxi ever could, especially when you consider the convenient smartphone integration these sharing apps provide.
It’s Not Just About Travel And Hospitality.
While sharing services like Uber, Lyft, and Airbnb are a few of the most well known and successful examples of the sharing economy’s prominence, it’s not just about travel and hospitality. There are many industries that are throwing their hats into the sharing ring—and finding success in the process. For example, Boataffair offers boutique boat rentals, and sites like DesksNearMe allows office space to be rented out. In the coming years, it is likely that we’ll see just about every imaginable industry emerge to meet the needs of the sharing economy.
It’s A Matter Of Trust.
For businesses looking to get involved in the sharing economy, one of the most important components to keep in mind throughout the entire process is trust. Sharing services like Uber and Airbnb have become so successful not just because they have developed efficient, easy-to-use platforms or because they fill a large demand, but because they have focused on creating platforms that people feel safe and secure using. Specifically, in a survey of 2,000 consumers in both the United States and the United Kingdom, 61% reported that they wouldn’t trust another party in a transaction without having the other party’s identity verified first.
This need for security and verification is exactly why successful platforms like Uber and Lyft require verification of their drivers and also require them to meet certain criteria (such as having proof of insurance, a newer and well maintained vehicle, etc.).
The Sharing Economy Is Here To Stay.
As more people across the globe become connected using smartphones, transaction costs associated with using these shared services is only expected to decrease. With that in mind, as well as the increased demand for these types of services by millennials and across other generations, means that the sharing economy isn’t likely to be going anywhere anytime soon. In fact, the sharing economy is expected to grow from about $14 billion in 2014 to $335 billion by the year 2025. These projections are based on the growth and success of existing sharing services, as well as the anticipated emergence of new industries in the collaborative services ring.
So, what does this mean for businesses and aspiring entrepreneurs? Mostly, it means that the most successful business of the future will be based in the idea of sharing and collaboration; existing businesses will need to be adaptable in order to remain relevant, and they will need to remain focused on providing authentic and personalized experiences to consumers.
While the concept of the sharing economy may seem like just a temporary buzzword to some, there’s no doubt that the demand for shared services is here to stay—and businesses would do well to cater to this demand in the coming years.