Prior to the internet ruining our basic social skills (what? Who said that!), the term Sharing Economy was foreign to not only myself, but to the whole world. Businesses, companies and corporations were thriving from television, newspaper, and outdoor advertising. I wanted to be the golden girl who created a ground breaking product that wooed the world. Not one part of me thought that creating a service using shared resources would be the future. No one did. That is, until the infamous Mark Zuckerberg came along.
The Sharing Economy, can be simply defined as a socio-economic ecosystem built around the sharing of human, physical, and intellectual resources. The most common examples of the Sharing Economy that have risen to tower over the top of traditional business models are Facebook, Airbnb, Uber, and Alibaba.
Some consumers are loving the price tag and convenience that comes with collaborative consumption (gourmet food delivered to your front door, AMAZING), whilst others are questioning the benefits and looking at the consequences.
The demand for sites such Airbnb and Uber has made business owners without resources wildly successful..But how so? Millennials are the answer! We have been the driving force in creating collobaritve consumption and actually making it ‘a thing’. Cheers to us!
But, when there’s a positive, there’s always a negative. Ya win some Ya lose some, as they say. Many are blaming the sharing economy for economic downturn for within certain industry’s.
Yes, we all get self-conscious talking about our Uber star rating, and blaming the low score on ‘this one time…my drunk friend’, but what has happened to the businesses within the industry’s in which the consumer-to-consumer economy took over?
The sharing economy has turned every business model upside down, offering their personal cars, homes and content for other people’s use. This consumer to consumer concept is on the rise to becoming monopoly markets within the specific fields, as the Taxi and Real Estate market make a turn for the worst.
The world is attached to social media and technology; anything and everything is posted to attract attention. The sharing economy has recognised this and created new economic value which disrupts current established industry players. Lisa Gansky, author of Why the Future of Business is Sharing, explains “there is a massive shift occurring and I believe all industries will be or are already being affected”.
The Journal of Business Research validates Gansky’s claim, stating, “The successful new sharing ventures are likely to shake established industries to the extent that sharing and collaborative consumption result in fewer purchases or facilitate a shift from individual ownership to shared ownership or short-term rental”.
Undoubtedly, Uber has become the ‘next big thing’ (after Beyonce’s new born earlier this year, obviously) and the Taxi industry is most upset that their monopoly industry is no longer and they have some competition. However, competition soon turned into domination with Taxi usage plummeting by 65 per cent in San Francisco. In New York, the famous yellow taxis have dropped 30 per cent as demand has decreased for traditional services. C’mon, who wants to get an Uber in New York City when you can hail a yellow taxi from the sidewalk?
*Every girl nods head*
Not only has Uber driven all over the traditional taxi companies, but AirBnb has become the number one destination to find and experience unique homes, places and destinations around the world. However, in Australia, AirBnb is showing its dark side, as concerns are being raised around the availability of rental properties within Australia, contributing to the housing crisis.
In Sydney alone, 60 per cent of 200,000 Airbnb listings are entire homes. While this may sound brilliant for those trying to find a party house for the weekend, however, there’s a housing affordability crisis in Australia, and aspects of the shared economy such as Airbnb can have an adverse impact on housing affordability, specifically the rental market.
Although there can be side effects to the concept, The peer-to-peer business structure is boosting the economy, with nine-to-five accessing a little bit extra every week by listing their spare room on Airbnb, or driving an Uber on weekends. Owners are making money from underused assets, which is cost-effective for both consumers. Some may say a win-win situation. It is if you ask me!