Late last year, Jeremiah Owyang left Altimeter Group to form a venture called Crowd Companies. The concept was simple: the self-serve nature of the web, technology and innovation has given rise to the ability for people to collaborate with each other to create products, services, transportation, space and money that were previously only controlled by brands.
Some high profile examples of start-ups in the Collaborative Economy include Uber, Kickstarter, Breather, Feastly, TechShop, Airbnb and more. The opportunity for brands is to get involved to help provide insights, resources, assets or other things to help foster this changing world. Standing by a long-held business model is not enough any more; people are empowered. The question is, what can companies do to help them and to adapt to the changing landscape? The formula is simple:
Empowered people. Resilient brands.
Because this is a fairly new area of the economy, there is little data on it. And yet it's imperative for businesses to understand what's going on beyond the macro-level trend. Crowd Companies and Vision Critical joined forces and completed a comprehensive survey of some 90,000 people about how they participate in this changing economy. The report, Sharing is the New Buying, is available for free (see below) and represents a real advance in understanding exactly who these people are and what they want.
The Lay of the LandConsumers no longer get their goods and services from the traditional vertical supply chain. The examples of startups that fill these gaps are numerous. Rather than buying goods from big brands, they can buy pre-owned (or new) goods from each other on eBay. Instead of staying at hotels, travelers can book homes or apartments via Airbnb. Rather than getting a loan from a bank, borrowers can get funds from each other through Lending Club.
The World of SharingThrough surveying 90,112 people, Crowd Companies and Vision Critical determined that there are three major types of customers in the collaborative economy:
- Non-sharers are people who have yet to engage in the collaborative economy. But many of them intend to try sharing services in the next 12 months, so they are a key target audience for both established businesses and sharing startups. They make up roughly 60% of the US and Canadian population and 48% of the UK.
- Re-sharers buy and/or sell pre-owned good online using well-established services like eBay and Craigslist. While many of them intend to try other kinds of sharing in the next 12 months, they have not done any "neo-sharing" in the past 12 months. They account for 16% of the US and Canadian population and 29% of the UK.
- Neo-sharers are already using emergent sharing services: in the past 12 months, they have used at least one of th elatest generation of sharing sites and apps, like Etsy, TaskRabbit, Uber, Airbnb and Kickstarter. Neo-sharers now constitute 23% of the population in the US and UK and 25% in Canada.
The report recognizes that there are societal, economic and technological drivers that are behind this transformational shift. Societal drivers include a desire for an independent lifestyle, concern about the environment and sustainability, and a rejection of a culture of accumulation. Economic includes the rising costs of production, desire to maximize resource utilization and a desire to source more income from personal projects. Technological drivers like mobile devices, social networks, payment systems and the like have made peer-to-peer transactions frictionless.
Where the opportunity for businesses lies is in determining how they fit in the matrix of the re-sharers, neo-sharers and the various business models.
Sharing is Growing
In every category except buying and selling pre-owned goods, the collaborative economy is growing. No single category stands out as advancing over the other; all categories are equally as good prospects for growth.
The size of the collaborative economy could double in the next 12 months. [Tweet this]
For more on where the opportunities lie in this growth segment, the report offers deeper insights.
Sharing is MainstreamThis isn't just something for urbanites or tech-savvy Millennials. Sharers reflect the population as a whole. While they skew younger, this is because this is an emergent behavior. Think about when eBay first came out and how you perhaps adapted first and now your parents may be buyers and even sellers on the online auction site.
Sharers tend to skew slightly younger: about half of neo sharers are in the 18-34 age range. And they're affluent: while 25% of the general US population are neo-sharers, among Americans with incomes over $100,000, 35% are neo-sharers.
Again, deeper analytics are available in the report that delve into exactly who these people are.
The things that most people share include: books, cars, clothes, condos and cottages, DVDs, jewelry, computers, phones and electronics, furniture, cleaning services, money, toys and writing services.
Reasons for SharingThis is probably the most interesting set of findings. Most of the sharing that occurs is driven by convenience, price and the desire for unique quality goods and services. It makes sense, as people are busy and want to simplify their lives, and the economic times call for thrifty solutions. Then again, sometimes, the product you can get from a peer is something that you might not be able to get elsewhere.
There are a number of other images and factoids to pull from the report, but it concludes with a section titled "How to Win in the Collaborative Economy," with call-outs for executives, marketing and market research, corporate development, legal, product and R&D, social media and social business teams, marketing and sales, finance, customer support, operations and supply chain and human resources.
The research is impressive and the outlook very promising. I'd be remiss if I didn't mention that it reminds me of a trend identified by the Ford team in the Looking Further with Ford 2014 Trends Report - particularly the "Innovation's Quiet Riot" section - put out by Ford Motor Company (my employer). Ford is also a charter member of the Crowd Companies business council, and its innovative work with TechShop and other partners through its global innovations group play into that as well.